A NY Fed study shows those with student loans generally are clueless about how onerous the terms are. Student loan debt is not dischargeable by bankruptcy. The government can and will hound delinquents endlessly. Banksters make risk-free loans which are guaranteed by the government. Those burdened with too much student loan debt are likely to be scared and passive, and will work 70 hr weeks without complaining because they need the money to pay the debt. And that’s precisely how the overlords want their vassals to be, meek and cowed.
Only 28 percent of respondents knew that if student loans aren’t repaid, the U.S. government can garnish wages, withhold Social Security payments and tax refunds, and report the debt to credit bureaus. Even more people—35 percent—incorrectly thought the government couldn’t do any of those things or said they didn’t know what the government could do. Only 37 percent of those surveyed knew that students loans are extremely hard to shed in bankruptcy, a reality that differentiates student loans from other debts, such as mortgages and credit cards.
Any similarity between the coming student loan debt bubble bursting and the housing bubble are of course not a coincidence at all. Every burst bubble means more money has been sucked out of the middle and working classes to the 1%.
All of the above, naturally, is a pivot to the moment just after the student debt bubble bursts: then, just like with the housing bubble, the excuse will be the Americans, hardly with a gun against their head, did not understand what the “implications” of burying yourself to the neck in debt are. Which is why they did it. Which is why the entire system had to be bailed out. Or something like that.
It is good to see that nobody has learned any lessons from the recent past, as usual.
Au contraire, the 1% has learned well how to siphon money from us to them, aided by the government.