To those who believe government should forgive
student loans, I ask about loans for home owners.
Answer & reasons please.
student loans, I ask about loans for home owners.
Answer & reasons please.
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Should Government Forgive Home Loans?
- Thread starter Revoltingest
- Start date
To me it's the wrong question.
An ideal society would ensure citizens have basic necessities, full stop. Whether doing that would take the form of something like universal basic income or free distribution of essential goods and services (or both) is an open question. In either event, the sort of predatory investing that has happened in the housing market in this country would not be permitted either.
An ideal society would ensure citizens have basic necessities, full stop. Whether doing that would take the form of something like universal basic income or free distribution of essential goods and services (or both) is an open question. In either event, the sort of predatory investing that has happened in the housing market in this country would not be permitted either.
I'll wager that no nation makes all education
available to all for free. Resources are limited,
so there must be an allocation mechanism.
But lets leave that discussion for the school
loan thread.
Do you have any thoughts about home loans?
Good question for a new thread.
This one is about home loans.
One option would be to forgive a portion of
principal & interest for troubled borrowers.
Currently this is allowed for private lenders,
but government lenders refuse.
Does the government even get to do that? As I understood it, the loan forgiveness meant that students didn't have to pay any loans, but the government itself was paying the lenders. So, in your proposal, would the government pay the banks who issued the home loans? Or would the banks just have to eat it?
Education is a profit-making investment. Housing has some societal benefits, but it's not nearly as profitable as education.
After WWII, the US government offered free tuition to veterans. Twenty years later it found it had made a 700% profit just in increased taxes from the now higher tax bracket veterans. Coupled with decreased rates of crime and imprisonment, and decreased usage of social services such as "welfare" and "food stamps," that free tuition was one of the best investments "Big
Government" ever made.
It did take more than a few financial quarters to pay off, though. In our current, Neoliberal system, such long-term investments -- including housing, infrastructure, &c. -- would be seen as profligate government spending.
After WWII, the US government offered free tuition to veterans. Twenty years later it found it had made a 700% profit just in increased taxes from the now higher tax bracket veterans. Coupled with decreased rates of crime and imprisonment, and decreased usage of social services such as "welfare" and "food stamps," that free tuition was one of the best investments "Big
Government" ever made.
It did take more than a few financial quarters to pay off, though. In our current, Neoliberal system, such long-term investments -- including housing, infrastructure, &c. -- would be seen as profligate government spending.
A most interesting question -- and I have no satisfactory answers. I'm also hobbled because:
- having been tossed by the Children's Aid at 17 with nothing, there was no way I was ever going to get enough student loan for me to get an education along with all other the costs of just keeping myself alive, fed, housed and clothed, and
- being a gay man never likely to have a family, I've always rented, never feeling the need to go through the hassles of home ownership.
- in a modern, highly technological world, an education is becoming much more than a nice-to-have, but something more of a necessity to even get a job that supports a life worth living
- as technology takes over more and more tasks that were once done by those without higher-level education (ATMs replace bank tellers, drones delivering goods instead of delivery persons, automated check-outs replacing cashiers, translation programs replacing translators -- and this will continue at faster and faster rates) education may be soon the only path to any sort of paid employment
- a student loan anticipates, but does not in any way guarantee, future income sufficient to repay it
- it might well be that a better-educated citizenry is a net good for the nation overall, while perhaps it is not so clear that home ownership will be or greater overall good then rental
- rental may not be ideal, but it is a perfectly workable means of providing shelter for self and family
- the cost of an education (generally) must be paid while one is still young and not in an earning position, while the cost of a mortgage may well be able to wait for some time, until financing can be adjusted to projected income
- it may well be that more education leads to more home ownership, which in itself is a net gain to the economy
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You get to answer your own questions
based upon the premise in the OP.
Propose a scenario you like.
Aye, to subsidize the housing cost of homeowners
only, not renters, does seem unfair, especially to
poorer folk, & mobile workers.
That really depends upon what the field is.
Medieval Art portends low wages.
Chemical engineering gets the big bucks.
And a PhD in math, computer science,
or physics from a top school actually
sees starting salaries of $1,000,000
at investment companies.
I don't think home ownership should be a societal goal.
It reduces workforce flexibility. And detached housing
is environmentally, financially, & socially costly.
Let those who really benefit from home ownership
do so, but not at the expense of people better off
in rental apartments.
Sure but then the government gets to decide who lives in the house with you.
Why? Because to each according to their needs and you certainly don't need that big old house all to yourself which you didn't even pay for.
I'm addressing our current economy,
not our eventual migration to a hive.
Well, perhaps fields of study could be in some meaningfully designated as necessary versus "personal interest." Nothing wrong with any of us satisfying our personal interests, but we perhaps shouldn't expect anyone else to care -- or help us pay for. Just as an example, it could be very much in the nation's interest to train up more engineers capable of designing better and better chips -- and taking a lot of that industry (started in the U.S., by the way) back.
That woudn't mean no arts -- there will always be those who are interested and can afford to pursue those subjects. And arts are important, too.
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Or let lenders decide who gets how much
based upon future ability to pay it back.
If government decides who gets money,
all those lawyers will subsidize only
law school. We'll become a nation of
naught but plaintiffs & defendants.
Other cities have managed their housing needs, but it involves government programs, and America is averse to 'Big Government' -- and anything that doesn't make a profit, for that matter.
As long as we're dedicated to an unregulated, free market, privatized economy, adequate, affordable housing's going to remain scarce.
The city that solved homelessness
Wohnpark Alt-Erlaa was built in stages between 1976 and 1985.
'It’s a miracle': Helsinki's radical solution to homelessness
Finland is the only EU country where homelessness is falling. Its secret? Giving people homes as soon as they need them – unconditionally
Heyo
Veteran Member
That is exactly where home loan forgiveness would be most appropriate (or would have been when the housing bubble burst). The banks (front and center the government affiliated) made irresponsible investments into home loans and the government didn't want to take responsibility. That's the parallel to the student loans, making insecure loans (to people who had to pick up tasks that were the governments in the first place) and not admitting to their lack of foresight and blaming it all on the lenders.
The government encourages student loans and grants them easily promoting the ability of schools to increase there charges. They do no such thing with home loans with an exception to military personal who get some benefit for serving our country but it is still nothing like student loans.
The government should have the same standards for Student loans as it does for home loans and then the problem would be resolved most people would be able to pay off their student loans; however, schools would start bleeding money as not as many people would be able to get loans. We all know how the government works can't have big business lose money but it OK to penalize the common folk.
Colt
Well-Known Member
Education is free up to 12 th grade in America, but 3,000,000+ quit the free school that we already offer.
Don't forget that many of these risky loans
were actually required by government, eg,
Community Reinvestment Act. And government
started PMI (Private Mortgage Insurance) to
encourage high LTV (Loan To Value ratio).
Those policies increased market instability.
I don't see higher education as government's
responsibility. But if government does assume
it, there shouldn't be heavy subsidy of low
value fields, eg, Women's studies, Diversity
Studies, Medieval Art.