Interesting thought experiment. If not accompanied by a crackdown on lending it would probably lead to *more* borrowing. It would increase federal debt, but act as a big stimulus, and free young people up to switch careers and take more risks.https://twitter.com/mingus_coleman/status/1053383719388635136 …
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So, why are those businesses profitable, then?
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A) Their profits are a trivial amount of the burden of student loan repayment. B) If govt. costs exceeded third-party provider costs, it's possible direct processing would increase repayment costs. C) Processing fees are a total and utter red herring in this debate!!
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I would say: 1) Administrative costs are always relevant, even if they don't solve the problem in this case 2) Servicers can be predatory. Obama added rules to restrict some of that, now it's starting up again. 3) Cost of forgiving high, I think a decent option is no intrst
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The mental gymnastics required to pin the student loan crisis on third-party processing companies are just SPECTACULAR here. It's like watching a contortionist.
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Yeah, man, you know that's not what I'm doing, but ok.
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It seems clear that at first you mistakenly thought private companies owned the loans, and when I informed you otherwise, you looked it up, realized the error, declined to admit it, and shifted the discussion to the irrelevant red herring of third-party processors. ;-)
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Yeah, I really enjoy your posts. That's not what happened. You assumed that I was speaking about institutions holding the loans, not doing the processing.
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"What do you think about just converting the loans to interest free? That's the part that I find most objectionable as private institutions are making generous profit for not really doing anything." <-- But doing this wouldn't cut out the need for processing
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