Grandmothers' Social Security Garnished for Student Loans? Time to Fix the Broken Student Debt System
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For students, at the very least, the bankruptcy option needs to be reinstated, usury laws restored, predatory practices eliminated and the cost of education brought back down to earth. One possibility for relieving the burden on students would be to give them interest-free loans. The government of New Zealand now offers 0 percent loans to New Zealand students, with repayment to be made from their income after they graduate. For the past twenty years, the Australian government has also successfully funded students by giving out what are in effect interest-free loans. The loans in the Australian Higher Education Loan Programme (or HELP) do not bear interest, but the government gets back more than it lends because the principal is indexed to the Consumer Price Index (CPI), which goes up every year.
Predatory lenders are keeping us in debt peonage through misguided economics and bank-captured legislators. We have people who desperately want to work, to the point of going back to school to try to improve their chances; and we have mountains of work that needs to be done. The only thing keeping them apart is that artificial constraint called "money," which we have allowed to be created by banks and let out at interest when it could have been created by public institutions for public purposes, either by direct issuance or through publicly owned banks. We just need to recognize our oppressors and throw off their yoke and the good times can roll again.