Why Hillary Clinton’s Student Debt Idea Is Smart

[riversedge]

TWEET:
Hillary Clinton Retweeted
Rana Foroohar ?@RanaForoohar Jun 29

Hillary's plan to connect debt relief to entrepreneurship is smart http://ti.me/29039IO #makersandtakers start-up rates falling since 70s




http://time.com/4386796/hillary-clinton-student-debt-entrepreneurship/?xid=tcoshare

Why Hillary Clinton’s Student Debt Idea Is Smart

Rana Foroohar

June 29, 2016


One of the most interesting economic solutions proposed by Hillary Clinton recently on the campaign trail is that the financial burden of education be eased for future entrepreneurs. Under her proposal, college graduates who start a business may end up being able to get their student loans deferred, interest-free, for up to three years as they launch new ventures. Those who locate in “distressed communities” or start a social enterprise also could ask the government to forgive as much as $17,500 in loans after five years in business.


The goal is not just to create jobs and encourage entrepreneurship amongst millennials, who are graduating with record debt and entering a still weaker-than-normal job market, but also to help boost enterprise creation in general, which has fallen dramatically in this country since the 1970s.

This is a big deal, because it ties into the most important economic question of the day, which is why there isn’t stronger productivity growth in the economy right now (economic growth is essential productivity plus demographics). In a speech Tuesday, Fed Governor Jerome Powell touched on the issue and the stakes:.......................

[tonyt53]

1. That "free" tuition Sanders has pushed does nothing to help in getting a job for most.

Considering that about 1/4 of the incoming freshmen of a class will not come back for their second year, it is worthless. Considering the fact that about 1/3 of the incoming freshman class will never finish college, it is worthless. A degree in a useless field is worthless. An associates degree in art will get a person a cashiers job at Kohl's or JC Penney. A bachelor's degree in art will get them a job as a cashier at Macy's. Welcome to the real world. Hillary evidently understands that, that is the reason for no mention of free college tuition.

[Mass]

6. No, it does not. What it does is making sure

that student do not have to pay for 10 or 20 years what others in the world get free (and with the exception of a few top colleges, as good).

This also insure that you can find MDs and lawyers for low-income communities because students do not need to go to top-notch clinics and law offices to pay their student loans. Those are 2 different problems.

[realmirage]

11. You do realize this is not Hillary's entire

student loan relief plan, right? She wants tuition assistance based on need. So if you can't afford it, it will be paid for. If you can afford college because your parents are wealthy, then it's not free. That seems much more logical than free tuition for everyone.

[Mass]

18. free tuition for everyone means that rich people pay for poor people by increasing taxes

in function of income (just like for high school) - and yes, this also means we have to fix taxes because there are too many loopholes).

Need-base relief hurt middle class people who do not qualify for the relief and are forced to take loans, without hurting rich people who can pay the $40,000+ a year without loans. Once again, this is the middle class that is hurt.

In addition, tuition assistance is in large part loans, which means that poor kids are straddled with paying back those loans for 10 or 20 years while rich graduates do not have to worry.

[Locrian]

26. exactly

nothing more than pandering, further separating rich / poor and gutting the middle class.

[Exilednight]

27. gutting the middle-class is denying them access to needed

Education. The facts are simple, a college education is outpacing inflation and even middle-class families can't afford to pay for four years of college.

For the first time in out history the younger generation do not believe they will have a better life than their parents. Access to education can change that.

[tonyt53]

31. Use the words "post secondary education", and you are onto something.

A traditional college education is a guarantee of nothing. But a post secondary education of some type greatly enhances the chances of a job. An apprenticeship in a building trades union is a 4 or 5 years education that also provides the person with a paid job as they learn. A journeyman pipe welder can easy knock down in excess of $75K a year with good benefits on top of that, with many earning much more than that in the very high demand field. Somebody has to build things.

[Exilednight]

32. What are you talking about? my first job with just a BA gave me a gross of

125k/yr.

After I finished both my masters programs I net more than double that, but I had to do it a very hard way and because of it I am years behind people who had entered college at 18 or 19 years old.

[glowing]

10. This is one of the reasons I feel our society is lacking...

There should be value in art, music, philosophy, and dreaming and inspiration in general. During the depression of the 1930's artist created murals on govt buildings, theater troupes travelled about the country bringing liveliness to desperate people's, museums were created, orchestra halls were built. There is value for a society that values art and thought.

As a world, we need to be embracing a completely different economic model... One that values human life along with the environmemt we live in. Wealth and money and the power that we as a society allow to amass at those with "monetary wealth", is all based on a theory of greed and value of paper or "0's" on a spread sheet. It's ridiculous. It makes no sense. And it's literally killing the only planet we have to live on.

[ljm2002]

15. [phone]!!!!! n/t

[glowing]

19. Thanks.. Glad other people like the idea

[ljm2002]

23. Yes! I myself pursued a technical degree...

...but have a great appreciation for the arts and almost went that direction instead.

It bugs the sh*t out of me that now we are told everyone must get into the STEM fields or they're sunk. It's part of the current technocratic way of thinking.

Who the heck wants to live in a world without art, music, novels, movies... ? All of these forms are incredibly enriching, and help us to broaden our perspectives.

Also, while I deeply admire scientists and mathematicians, they are susceptible to the same human foibles and shortcomings as the rest of us. Scientists can be bribed and these days it is not even unusual; and mathematicians can also succumb to greed. We see scientists paid by the fossil fuel industry to deny climate change, and we see mathematicians using their considerable knowledge to create complex financial instruments in the service of Wall Street greed.

I believe the powers that be prefer a technically literate but socially illiterate population. We're more useful to them that way -- we can perform the technical tasks necessary to modern industry, while remaining ignorant of the social issues and failing to apply critical thinking to politics.

JMNSHO

[quaker bill]

22. What a lame point of view

First, my daughter has a BFA and is gainfully employed as an artist. The internet and the gaming industry have created tons of jobs for folks with tech and artistic skills. Folks with a BFA are hired regularly.

The second lameness is the general concept that we should only provide support on with conditions that people be "successful" in the lines of work we favor. This is both stupid and destructive. Our Universities can produce an oversupply of any credential if you press them to focus in any one direction. Yes, some people sign up for college who don't belong there, but I think it is better to try, than be denied the chance. Folks who bail, some before the withdrawal / refund deadline in the fall, cost very little to the system.

Additionally "deferment" of interest and payments is a lame half measure and will provide little incentive to do anything. A friend could get her student loans "forgiven" if she took a "vow of poverty" job in social services in the inner city somewhere. She could not afford to live on it, but because she met the "conditions" laid down by the last Clinton administration, her loans would be forgiven. She can't afford to do it and won't.

Finally, we as a species are very poor at social engineering at this scale. This is what picking winners and losers does, it attempts to re-engineer society. "If we have more people with these degrees and fewer with those, society will work better, and we will be more competitive on the global stage." This stuff is bovine excrement in patty form. Remodeling how we train people has been a popular play toy since the 1990s. Nothing about this has prevented the loss of well paying jobs or the concentration of wealth in the hands of the 1%.

[AgingAmerican]

25. This is just plain ignorant

[insta8er]

2. 90% of new businesses fail in the first 5 years.

[tonyt53]

3. Actually it is about 50%. Poor financial backing usually get them.

[insta8er]

4. Even at 50% (the numbers are not totally solid)..this would be not that much of an incentive. I stil

l like Sanders Idea better. Plus the ivy league colleges that are bilking the students now are not going to have such a huge market anymore, only those who can afford it. The rest will have a chance to get an education that will strengthen our workforce with EDUCATED people who can compete with the likes of countries in Europe who also offer free college education.
This idea from Hillary is just one that again makes sure that those who profit from the current system continue to profit from it. And get incentivized by tax payer money. Think about that last one!

[Mass]

5. It can be a good addition to other measures, but

I assume that there are other measures to help people who do not want to create an enterprise.

[okasha]

7. Unlike Sanders,

Hillary wants public colleges and universities to bear some of the costs themselves. Many of these institutions have monstrously inflated and overpaid administrative staffs. When the top layer of administration yearly rakes in as much as the faculty, mid-management and clerical staffs combined,, the priorities are wrong. Firing some of the bloodsuckers would free up a lot of money for student assistance in scholarships and work-study.

[stuffmatters]

8. This is stomach turning: Privilege to "job creators" not nurses, teachers,firemen, i.e.WORKERS

Not to mention that most entrepreneurs fail, so even this category for which Clinton so tone deafeningly wants to give preferential
treatment would end up further impoverishing those entrepreneurs not funded by family wealth.

Could Eliz Warren please talk to Clinton about all her repugnant "free stuff" mentality against giving kids free public college and university tuition? Hilary Clinton herself went to private colleges, but she had the excellent Uni of Illinois freely and unconditionally available to her if she made the grades.

[realmirage]

13. This is just one part of her tuition assistance plans.

The professions you listed will get assistance based on need. If you are wealthy you don't get free tuition. If not, you will.

[Bonhomme Richard]

9. Maybe in addition to other things it would help but this alone this is ridiculous.

It takes money to start a business and being in debt to begin with does not bode well. In addition the only place to get money for your venture is from family or friends. Banks do not lend to new businesses unless the money is backed by collateral which a recent college grad does not have.
A landscaping business maybe with hard work. Writing software..if the idea is a good one then yes. Retail, manufacturing or anything like that then the odds are stacked against you.
Even if there were a possibility that it could work the ability to start and run a business is not something many can do.
This is nothing more than a panacea that will protect the lenders and not change a damn thing.
The thing is...it seems smart to anyone that hasn't started a business.

[realmirage]

14. This is just one tiny part of her student loan assistance

platform. Just one.

[Bettie]

35. It could be real boon to companies

that sell multi-level marketing "businesses".

Of course, most of the people who get involved in those lose, but the people on top will win, win, win! After all, that counts as "starting a business"!

I'd rather send a few rich kids to a public university (most will still go to high end private schools) and have many more of lesser means able to attain an education than insist that if you want your debt to be less than crippling, you have to "start a business".

[MoonRiver]

12. K&R big time!

[Vinca]

16. The word that stands out to me is "deferred."

But, this is the path that has been chosen, so my advice to young people is think long and hard about what you want to do with yourself before you sign on the dotted line. Businesses can be started without a college education.

[politicaljunkie41910]

17. There are ways to make college affordable if people are willing to give something to get something.

My husband and I put three kids through college. Our kids went to local community colleges (junior college, 2yr college whatever they call them where you live) here in California for the first two years of their college education even though we had started saving for their college and bought U.S. savings bonds for them from the time they were born. Once of my sons received a football scholarship after completing his second year at the JC.

My sister got scholarship for medical school after she completed college through the Armed Forces Professional Scholarship Program in exchange for 4 years of service as a Medical Doctor once she completed her residency. This actually took about 11 years of her life because her stint with the military began immediately upon her acceptance of the scholarship though her status was inactive while in medical school and she was sworn in as a member of the AF Reserves. She also choose to go on active duty during the time school was out for summer because she got paid for it and it helped with her personal expenses during the regular school year when she was in Med School. Once she graduated from Med School the military only had a limited number of Residency Programs so she had to complete her 3 yr residency in a non military hospital. She continued to go on active duty once a year while in her Residency program using her vacation time as it afforded her opportinities to go to different places around the country and also to be paid a military salary while working. After she completed her Residency, she then went on active duty for 4 years and completed her military obligation debt free for the remainder of her life.

Federal workers can get part of their student loans discharged in exchange for working for the federal govt. Teachers and people who work in certain programs that help disadvantaged people can get their student loans discharged in exchange for public service.

I spent 4 years in the military and went to school with the assistance of the GI Bill.

Where there's a will, there's a way. So I have little patience for people who just want to sit back and whine and want something for nothing, particularly those who have more and better technological equipment (Mac, IPhones etc) than I, and drive newer cars than I, but want people to pay for their education and healthcare.

An education doesn't have to cost you a lifetime of debt if you plan ahead and be smart about it.

[Avalon Sparks]

21. Your way may result in death.....

Kudos to your sister and you for risking your lives to get an education. I certainly understand your viewpoint and opinion considering how you acquired your education, however I believe other more affordable and less risky options should be available to young people. For them and for the goal of having an educated society.

I also paid for my education, but I didn't have to put my life on the line to do it.

From 86 to 89 I worked part time for min wage, 3.25 to 4 dollars an hour, in the summers only, and earned enough to cover my books and tuition each year, about 900 to 1000 a year.

In order to pay for tuition alone at the same University today, min wage woukd need o be about 32.50 dollars an hour.

[Independent_Voice]

30. ^-------- THIS

Well said, Avalon!

[Avalon Sparks]

37. Thank you for the kind words

😺

[jimw81]

20. College is so useless today's

Economy. Yes some degrees require a college degree most employers look at experience and customer service. College degrees are for mostly for manager positions in fields. I rather hire a person with experience over a college kid. I rather spend the $$ on universal pre-k

The purpose of her plan is to motivate ppl out of college to have responsibility and seceed in life and instead of looking for hand out.

[Avalon Sparks]

24. Hand out?

It's usually the Repugs referring to things as handouts.

The company I work for, (global firm with 65,000 US employees, 300,000 globally) doesn't hire anyone that doesn't have a college degree. Including administrative assistants.

What do you mean most employers look at customer service? That doesn't even make sense.

I didn't consider my college education a handout. I was able to pay my tuition each year from 86-89 at a Texas State university by working part time in the summers for min wage. Yes I said part time not full time, summers only. For 15 hours the cost each semester was around $350, current tuition is $5000 per semester for 15 hours.

How is that increase in anyway acceptable? In order to pay for college like I did, min wage would have to be $32.50 an hour.

Handout my ass...... Government needs to put more money into education and less into the defense industry.

Our tax dollars are going straight to corporate welfare, there's your effing handouts.

Young people today should be able to afford college like my generation did. To make silly justifications for why they don't 'need' college or accuse them of wanting a handout is absurd.

[Bettie]

36. When my husband was unemployed for nearly a year

due to a merger where his department was eliminated, his twenty years of experience counted for exactly nothing in most cases. His skill set counted for nothing.

All most companies wanted to see was a degree and he doesn't have an advanced one.

The job he finally found uses his rather unique skill set and it was due to that he even got an interview with only an Associate's degree.

[harun]

28. I think those without the capital and drive to start a biz out of college need assistance more.

[xocet]

29. An educated populace is required for democracy to work well. An undereducated, Republican country..

Last edited Tue Jul 5, 2016, 03:57 PM - Edit history (1)

would be fine with global climate change, smoking, CFC's, pre-emptive invasions, etc.

Education is the remedy for that sort of stupidity.

As a nation, the USA has a choice: make it easy for people to be educated or make it difficult to be educated.

Simply put, student loans and student debt hinder people from getting their educations.

If one is not working towards making a college education the birthright of any US citizen who has the drive to do the work necessary to earn a degree in their desired field of study, they are working against the future of the USA.

[Scurrilous]

33. K & R

[Cha]

34. Thank you, rivers!

[zipplewrath]

38. Huge oportunity for abuse

It reminds me of the people who take graduate level courses after graduation so they can defer debt payments. They're not really working on advanced degrees at all.

You'll have a glut of people starting "businesses" to avoid payments, but very little real economic activity. You'll even see a small cottage industry of outfits that will help you "start" a business solely to avoid making payments.

We don't do this for high school, I don't understand why we want to avoid public college education. It's the "single payer" of education. The chance for the federal government to provide an opportunity for people to get a college degree without a large debt. We don't have to pay for Harvard necessarily, but it would seem we have the public/land grant college system in place to allow for publicly funded college degrees. Between community colleges, and state university systems, it would seem the cost could be contained and the opportunities remain rather broad.