QuestionGuy
Why can’t the feds just set the interest rate on student loans to 0% permanently, and require payment plans be set up for the principal?
Why can’t the feds just set the interest rate on student loans to 0% permanently, and require payment plans be set up for the principal?
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If I had to guess I’d say money.
They could, but they aren’t financially incentivized to because corporations deserve the same rights to donate to political campaigns that you and I enjoy, oh joy!
Or allow people to file bankruptcy on it. That way they have a way out of debt but it’s still something you have to decide to do that has a price not just magically erase debt for some on a choice they made.
Because it’s not politically feasible.
Because it would show people that the main tenets of Economics are in truth political decisions.
There are at least some costs to servicing loans and inflation is a legitimate thing. No banks would volunteer to lose money on a deal like that.
However, there should be interest rate caps, a required civil service from banks to hold at least a certain percentage of low rate student loans, and most importantly, have any loan payment amount include a minimum percent of the payment be attributed to principle.
Interest is how they make money off the loans. No interest no money to be made.
Bc … you know… who’s gonna pay for it or whatever
Define “Feds”
If you mean the president it’s because they don’t control the purse, they are supposed to follow the laws that congress sets up.
If you mean congress, it’s because one party doesn’t want to do that and they hold veto power (the house) right now. Nothing will change until when/if they don’t hold any veto power again.
The party that *says* they want to do something about student loan debt had a chance from 2021-recently. But it turns out two senators liked their names in the paper more than toeing the party line, so they held veto power and refused. There is some doubt that it would change even if there was no one holding veto power, but I guess we’ll never know.
Well cuz then no one would loan out the money in the first place, so no students would actually be able to get a loan.
They can, but that wouldn’t buy as many votes.
How will capitalist greed be satisfied by that?