I remember it like yesterday, our anointed president at the time, Barack Obama, announcing the U. S. government would be the lender of record for all future college education loans. Those rascally banks were just putting too much pressure on those wanting help to attend college by asking they pay it back at a small interest rate once they graduated.
What cretins, wanting the bank members money to be paid back to the bank so lending to others could proceed!
I knew it would be a massive giant ClusterFoxtrot, anytime the government gets it’s ugly mitts on a program, it expands exponentially and graft and corruption ensue. Besides, anything Obama and his administration touched turned into brown excrement.
It was announced recently the federal government is set to lose nearly half a trillion taxpayer dollars in college loans that won’t be repaid, according to an analysis conducted by the U.S. Department of Education. What a surprise! I was completely taken aback and had the vapors. The federal government program in trouble? How could this be?
The Education Department, which has surpassed Bank of America and JP Morgan Chase to become the nation’s largest consumer lender, hired FI Consulting to examine the $1.37 trillion dollar student loan portfolio held by the federal government at the beginning of this year (2020).
The accounting firm projected that borrowers could pay back $935 billion in principal and interest. That leaves a $435 billion loss, which is by far larger than any estimates released previously. This includes the Congressional Budget Office estimate in May 2019 of a loss of $31 billion, including administrative costs (yes, there is a cost to lending – personnel, overhead, administration of accounts, etc.).
As Gomer Pyle used to say, “Surprise, surprise, surprise”! It is almost as much as the $535 billion that private lenders lost from subprime mortgages in the 2008 financial crisis. Subprime mortgages that the federal government insisted banks must allow or their charters to do business would be pulled. Oh, our wonderful federal government, just a barrel of laughs and bad news.
According to the Wall Street Journal, the projected losses are largely driven by defaults and income-based federal student loan forgiveness programs. That means little Johnny or Susie can say they can’t get a job with their degree in Underwater Basket-Weaving so their loans must be forgiven. But they can weave a fine basket!
This debacle doesn’t include about $150 billion in loans from private lenders backed by the U.S. government, which isn’t eligible for federal student loan forgiveness but are at risk of default.
This comes at a time Democrats call for easing some, if not completely eliminating student loan debt. What a fine Christmas present for the U.S. taxpayers!
You wanted Biden, and you now have a dementia ridden, forgetful, bumbling, stumbling shell of a man to be president, or should I say figurehead. We all know Kamala the Commie will soon be the president after Joe is committed to the nursing home of his choice.
And I will support the new president exactly like the Media (ABC, CBS, NBC, MSNBC, CNN, all newspapers and magazines), Establishment Republicans, BLM, Antifa, Russians, Chinese did to President Trump and his Administration.
I really will – I PROMISE!
The rotting of America from within continues in earnest soon!