Saturday, April 28, 2012

Student Loans and Government Predatory Lending: The Maverick Conservative Gets It Right Again, as Federal Government Repeats Housing Mistakes

What was the BASIC cause of the housing "bubble", and the trigger for the worst recession since World War II (from which Obama, with the aid of the GOP, is making it impossible for us to "recover")?  GOVERNMENT SPONSERED PREDATORY LENDING. For decades, and at an accelerateing pace--helped by the ECONOMIC FASCISM of "quasi-government" entities Fannie Mae and Freddie Mac--the Federal Government ENCOURAGED people to buy houses they dould not afford, based on the assumption that housing prices would just keep going up (about which Bailont Ben Bernanke--The Worst Failure in the History of World Finance--did absolutely noting). That is what is so hilairous about this standard leftist FANTASY about "predatory lending".  The Federal Government was THROWING MONEY at housing, to make it possible for EVeVEYONE to onw a house (whehter the person can afford it or not, and whehter the person is o welfare and food stampls or not). This DROVE UP house prices, and led  banks and mortgage companies to GO WHERE THE MONEY IS.  Willie Sutton, on why he robbed banks:  "That is where the money is." 

Is it "predatory lending" to do what the GOVERNMENT is virutually ROCING you to do (not aloowing yu to "discriminate" against even POOR people--the problem being that POOR people can't afford a house)?  Is it "predatory" to FORCE MONEY ON PEOPLE, or to give people the idea that they don't really NEED MONEY to buy a house?  Wy should they?  They can live in a house for a matter of a year or two, or maybe even a month or tow, and MAKE MONEY if they are FORCED to sell the house because they can't really afford it.  What happens, with this GOVERNMENT philosophy?  Right.  The PRICE of houses goes up to impossible heights. It is INEVITABLE that the "buble' will burst.  WHEN (not "if') the bubble bursts, people who were "encouraged" to take out loans they can't afford have no chance to pay back the loans.  The death spiral feeds on itself, and we end up where we are now.  Yes, this was exacerbated byt he fact that BANKS were looking at all of this lovely government money, ankd figured they shouuld get their fair share: bying into this FALSE, predatory "philosophy" of government DISTORTION of the marketplance.  So Wall Street and tge big banks figured out how to LEVERAGE the "bubble', because--as Willie Sutton said, although from a slightly different perspective--that is where the money was. 

Now look at what I said yesterday about teh PREDATORY LENDING (same as government encouraged--almost mandated--lending in housing) of STUDENT LOANS.  You may have thought: "Hey, Skip can never be PROVEN right on this one--at least not until the whole thing COLLAPSES."  Wrong you are. The DAY after I wrote that sentence or two about the PREDATROY LENDING of government sponsered, subsidized student loans, CNN had a panel discussion where the LEFTIST and the HOST expressed the same concerns that I was referencing. If it is OBVIUIS enough for CNN, then you KNOW that what I said has lalready been ROVEN. 

Thus, you have the LEFTIST saying: "Banks are approaching 18 year olds who do not have any idea how the world works, and selling them these predatory loans."  What this leftist, being a leftist, failed to mention was that it is usaully not exactly the BANK.  What happens is thaat  a SCHOOL--wither a legitimate shocll or one takng adantage of all of hat lovely government money to basicaly take advantage of peole--sort of "funnels' students to a ban (or several banks).  Or else a SCHOOL tells students about the government progras/subsidies available, and suggests that the student can find "free" money from these programs by looknig around.  Then you may have banks 'advertising" that they have loans avilable.  Is that not the whole POHNT of the government prgorram: for students to take advantage of the program,and know that it exists?  You can see the PREDATION here.  And look at the RESULT, even with a recognized school like HARVARD.  Harvard gets to RAISE TUTTION, and does not have to use HARVARD'S MONEY (a truly LARGE "endowmennt") for StTUDENTS.  The GOVERNMENT helps HARVARD, and a lot of schools less pretigius than Harvard. This puts ACADEMIA in the same positon as HOUSING COMPNIES and BANKS in the housing "bubble".  Schools don't have to be COMPETITIVE n price) or EFFICIENT.  They can give all of those LEFTIST professors and administrators all of the money they want.  The GOVERNMENT is really "paying for it", thourgh these SUBSIDIZED grants and loans.  That is hwere the CNN HOST actually came in, raising the QUETIN of whether these student loans (even worse for GRANTS) was creating a BUBBLE (not a word the ost used, of course), in SCHOOL TUITION. 

It is the housing bubble all over again, and teh LEFTIST REPSONE is the SAME. Don't balame the government DISTORTION and "FREE" MONEY.  Don't blame the government POLICY of encouraging people to take out loans they will NEVER be able to pay back.  There are estimates taht there may be as much as a TRILLIN dollars in student loanns, or at least we may be in the process of builidn gthat much of a possible DEFAULT (just like in housing, as students cannot ever pay the money pack).  But the LEFTRIST "respoonse" is to BLAME HT BANKS for their "predatory lending".  That is what the LEFTIST on CNN did.  He recognized the problem that students were taking out loans that they could never repay, but what he wanted to do is simply GIVE THEM THE MONEY--along with governmment REFORM and REGULATION to crack down on "abuse".  This is ALWAYS the leftist "respoinse", no matter how many times it FAiLS. Thus, President Obama is out there calling for "reform" in student loans to REGULATE banks (and maybe even schools). 

What can you say about peole this DUMB, or thiss ideologically crazy?  I know exactly what I just called our President, and I meant it. What you can say is that people who think like this are gong to DESTROY US>  To look at the FEDERAL GOVERNMENT as an INFINITE source of money WILL destroy us, and that is what all of  these people who want the FEDERAl GOVERNMENT to :"ensure" that everyone can get a college education are ding.  The Federal Governemnt is looked on as a source of "free mmoney".  It USED to be that peole living in individual states could receive a CHEAP eduction in state colleges and universities.  I went to law school, in 1971, on the G. I. BILL.  Some minor savings (from my army "salary). NO LOAN.  Not even a JOB. NO parental support.  Government POLICY has made this currently impossible. What I did with my Gi. I. laon, at the University of Texas, one of my borthers did WORKNG AT MCDONALD'S (to fund his undergraduate studies at the University of Texas). If it CAN'T be done on a STAE and LOCAL level, then it CAnNNOT BE DONE.  Throwing FEDERAL money at tthe problem merely makes lthe problem WORSE, as the HOGS line up at the trough (incduding the HOGS in the Federal Governennmnet).

No.  The lefitst is right, as this blog was right just yesterday.  Massively increasing SUBSIDIZED student loans merely ensures lPREDATORY LENDING of money that people will NEVER be able to pay back.  And, in a lot of ways, GRANTS are even worse, ecause lthey are perceived as even more "free"--even as they CAUSE educatin in this coun nntry to be PRICED out of MOST people's reach, AND creat all of thos "Willie Sutton's" out there going "where the money is' to get money from the American TAXPAYER (or from LOANS that the GOVERNMENT is taking tut in the NAME of the American taxpayer).

Sad. Really sad.  And this idea of "free" goernment money keeps getting HARDER to fight, as it permeates ever greater areas of our lives.  FREE CONTRACEPTION???????????!!!!!!  That is now the "standard" of the kind of BIRDE you need to make to a group of "gargeted" voters (WOMEN) in order to BUUY their votes. Then there are the BRIBES to STUDENTS.  And the GOP seems unable to call these BRIGBES what they are, and to make the case that the whole thing will DESTROY us. 

P.S.  No proofrading or spell checking (bad eyesight). 

1 comment:

Seth Anderson said...

Don't blame the government policy of encouraging people to take out loans they will never be able to pay back. For students to take advantage of the program.