It depends on what you mean by that. They aren't driving the problem, that's a massive, broad societal issue that involves states taking on more health care expenses, cutting educational funding... But they are a source of misery for millions and millions of borrowers.
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Replying to @doubtthat11
No they're not the source of misery. They're merely the implementation of the misery. Less "predatory" processors that allowed people to de-facto default on their loans without harassment would be fine, but there's a reason the govt. doesn't hire or create such processors.
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Replying to @Noahpinion
I sinderely don't follow. They are actively engaging in damaging practices. The Consumer protection board found this. States have filed lawsuits. Obama era protections limited some of the behavior, then Trump admin pulled back and the complaints are up.https://www.consumerreports.org/student-loans/student-loan-servicers-complaints-mount-as-protections-erode/ …
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Replying to @doubtthat11
Yes. The point is, hiring (or creating) processors that don't do shitty things to harass people to repay their loans is basically letting people de-facto default. Which is fine, though not nearly as good as formally letting people default. There's a reason neither has been done.
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Replying to @Noahpinion
Yes, I agree. My argument was not to eliminate repayment enforcement, but to rein in the crappy behavior. Like, they do similar shit to, say, Wells Fargo - soaking people with bullshit fees, being deceptive...but I still think there shoud be banks.
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Replying to @doubtthat11
I agree. They should. They should also forgive part of student debt. BUT. Student loans are 45% of the federal govt.'s financial asset portfolio. So it's understandable that they don't want to do this.
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Replying to @Noahpinion @doubtthat11
It will probably be possible to force govt. to forgive some part of student loans. BUT, in the long term, getting govt. out of the student loan business - as much as I'd like govt. to take a more active role in other areas of finance - seems like an important thing to do.
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Replying to @Noahpinion
The long term solution, in my opinion, comes from the other direction - going after some of the factors that have caused the cost explosion/decreasing of state funding. I'm open to opinions on the government role.
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Replying to @doubtthat11
Basically the govt. first encouraged companies to lend kids a ton of $, then started lending it directly, which fed tuition rises and people taking on more debt than they could afford. That policy needs to end.
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Replying to @Noahpinion
And on the other end, states around the country, for various reasons (politics, health care costs...etc.), cut their contributions to higher ed forcing tuition increases which were paid for with loans...etc.
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