Comments on Quick Takes: Edwards Gets Economists' Backing, President's Home Shot, U.S. Plans New Negotiations on Student Aid Rules

• Heterodox Economists for Edwards???
• Posted by Robert , PhD Student on January 3, 2008 at 8:15am EST

• Although I consider the political endorsement of an academic to be worth a bucket of warm spit, it's interesting to note the disproportionate number of economists from heterodox institutions (UMass-Amherst, UMKC) and historically very liberal institutions (Middlebury) on the list.

  Just like Ron Paul's list, which is full of economist6s from historically libertarian schools like George Mason and Auburn, this doesn't bode well for Edwards's ability to attract mainstream support.

• A Disregard of Fraud
• Posted by kgotthardt on January 3, 2008 at 8:35am EST

• How about discharge for students who have been ripped off by schools?

  One of the primary problems with Ed's loan forgiveness and discharge programs is they do NOT work with accreditors to assess or penalize schools that take advantage of students. Too many schools still enroll students who are unable to function or benefit from their programs; these schools do not have the kinds of services students need to succeed. These schools don't want to pay for the services, and they are more concerned with raking in revenue than anything else. Both non-profit and for-profits are guilty of this.

  Yet Ed. does not discharge the loans under the "ability to benefit" criteria, so the schools continue to recruit and admit the most vulnerable populations. This leaves the student with no choices: stay in debt for failed programs or sue the school if they can afford lawyers (which they usually cannot). Even bankruptcy is not an option, not only because courts won't discharge student loans but because a bankruptcy penalizes students for the schools' failure.

  Courts, lawyers, and Ed. are too reluctant to take on these schools because they view the arguments as academic and out of their purview. Why? Unethical schools use academic arguments to put the onus on the student. "He just didn't try." "She doesn't have what it takes." "She has poor attendance." They bring these students down no matter HOW hard the student works.

  Some examples? Unethical schools enroll students with criminal records to IT programs in which jobs require security clearances. They collect Title IV funds from students who break parole and end up back in jail. Then they say the student has poor attendance. They admit students with documented disabilities but do not provide adequate accommodations or services from trained professionals. They recruit students whom they know have no transportation. They recruit students whose commutes (in run-down vehicles) would be unreasonable even for more affluent students. The list goes on and on.

  Because of this, vulnerable students continue to fall prey to unethical schools that walk the fine line between legitimacy and fraud. Accreditors allow it to happen, and so does Ed. Students have no consumer rights or recourse. They are relegated to a life of failure, putting them in worse socioeconomic positions than when they began.

  How about addressing THAT to your negotiating list?

• Negotiated Rulemaking
• Posted by Glen S. McGhee , Dir., at FHEAP on January 3, 2008 at 11:35am EST

• According to the US Dept of Ed rulemaking notice, Student Loan agenda topics were solicited Nov 2007, limited by relevance to new legislation.

  I found K's list very insightful (all except the driving-distance one -- doesn't distance learning cover that?).

  The problem is that Congress cannot see past the end of its nose, and even then often cannot see what is in front of it.

  Meanwhile, cohort default rates are monitored, and with the proposed changes in how that is to be measured, schools and lenders will be more cautious about who they will loan to. This might curtail some of the practices mentioned.

  Sallie Mae's recent dramatic stock declines show that investor concerns about loan practices in other areas of the economy are spilling over onto student loan portfolios as well.

  In this case, negotiated rulemaking selects participants for a prescribed, path-dependent agenda. Creativity and thinking outside the box are limited to agenda items.

• Posted by kgotthardt on January 3, 2008 at 9:00pm EST

• "I found K’s list very insightful (all except the driving-distance one — doesn’t distance learning cover that?)."

  Glen, not all of these schools offer distance education. But they recruit students anyway. Interesting, huh?

• Same Ol' Thing
• Posted by Jim , Same Ol' Thing on January 16, 2008 at 7:45am EST

• It seems that Congress and the President are turning a blind eye to the REAL problem here. People are people, and people do have problems in their lives from time to time. There are issues here that need to be addressed and no one is truly wanting to look at them.

  It seems there are too many people worried about loosing their coosh jobs if they even consider readopting standardized consumer protections for student loans and stop giving them special treatment above and beyond anything any other type of loan may recieve.

  I have read email after email from people who are truly in desperate situations and considering ending their lives due to the undue pressure being exerted upon them. We as a nation have become overly complacent in our way of thinking that we can't stand the thought of someone benefiting from a program and in the end having no compation or pitty for those who truly need it.

  The courts have been left to define what is undue hardship in the bankruptcy law concerning student loans and in the end, people even in the most dire of straights are denied the most basic of relief. People with the most sevier of handicaps are being denied, people who are at the end of their financial ropes are being denied. Yes, people can file and recieve some, but not total relief, in bk court.

  Courts are eleminating most of the debt people are needing relief from but in the end, they are not much better off than they were before because they still have this albitross hanging around their necks rotting away. Courts are simply not doing enough. Congress is not dueing enough.