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The Great College Loan Swindle

Posted on November 5th, 2017 at 23:18 by John Sinteur in category: News

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Americans don’t understand the student-loan crisis because they’ve been trained to view the issue in terms of a series of separate, unrelated problems. They will read in one place that as of the summer of 2017, a record 8.5 million Americans are in default on their student debt, with about $1.3 trillion in loans still outstanding.

In another place, voters will read that the cost of higher education is skyrocketing, soaring in a seemingly market-defying arc that for nearly a decade now has run almost double the rate of inflation. Tuition for a halfway decent school now frequently surpasses $50,000 a year. How, the average newsreader wonders, can any child not born in a yacht afford to go to school these days?

In a third place, that same reader will see some heartless monster, usually a Republican, threatening to cut federal student lending. The current bogeyman is Trump, who is threatening to slash the Pell Grant program by $3.9 billion, which would seem to put higher education even further out of reach for poor and middle-income families. This too seems appalling, and triggers a different kind of response, encouraging progressive voters to lobby for increased availability for educational lending.

But the separateness of these stories clouds the unifying issue underneath: The education industry as a whole is a con. In fact, since the mortgage business blew up in 2008, education and student debt is probably our reigning unexposed nation-wide scam.

It’s a multiparty affair, what shakedown artists call a “big store scheme,” like in the movie The Sting: a complex deception requiring a big cast to string the mark along every step of the way. In higher education, every party you meet, from the moment you first set foot on campus, is in on the game.

America as a country has evolved in recent decades into a confederacy of widescale industrial scams. The biggest slices of our economic pie – sectors like health care, military production, banking, even commercial and residential real estate – have become crude income-redistribution schemes, often untethered from the market by subsidies or bailouts, with the richest companies benefiting from gamed or denuded regulatory systems that make profits almost as assured as taxes. Guaranteed-profit scams – that’s the last thing America makes with any level of consistent competence. In that light, Trump, among other things, the former head of a schlock diploma mill called Trump University, is a perfect president for these times. He’s the scammer-in-chief in the Great American Ripoff Age, a time in which fleecing students is one of our signature achievements.


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Comments:

  1. “Scammer-in-chief in the Great American Ripoff Age” Well said. ….Now if just can teach people two things in high school: 1) Basic Compound interest and 2) the real view of how this f_cked up country is run by and for the rich, then maybe the entertain me set will begin to change into the vocal protest set.

How the Democrats Are Failing the Resistance

Posted on November 5th, 2017 at 23:06 by John Sinteur in category: News

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And next Tuesday, we will get a dose of outside-the-bubble political reality. Ed Gillespie and Ralph Northam will be duking it out in the Virginia governor’s race in an evenly balanced, but Democratic-trending, state. It has morphed into a real-life test of how strong Trumpism will be in 2018, how effective the Democrats are as an alternative, and the future of the country. I don’t know what the result will be. But it is not looking good — for the Democrats or the country as a whole.

Northam seems to me almost a classic Democratic politician of our time. I have no idea what his core message is (and neither, it seems, does he); on paper, he’s close to perfect; his personality is anodyne; his skills as a campaigner are risible; and he has negative charisma. More to the point, he is running against an amphibian swamp creature, Ed Gillespie, and yet the Washington lobbyist is outflanking him on populism. Northam’s ads are super lame, and have lately been largely on the defensive, especially on crime, culture, and immigration. He hasn’t galvanized minority voters, has alienated many white voters, and has failed to consolidate a broader anti-Trump coalition. In Virginia, Trump’s approval rating is 38/59, but Northam is winning only 81 percent of the disapprovers, while Gillespie is winning 95 percent of the approvers. Northam’s early double-digit lead has now collapsed to within the margin of error.

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Now go to Northam’s website and you see a near-copy of Clinton’s agenda last year. Drenched in wonky micro-policies, one of its exhausted themes is actually “Working Together.” If you plumb the message, behind various poll-tested good-government bromides, he even has policy proposals on concussions and STEM curricula, and a smoking ban. This is Establishment Democratic boilerplate. And Democratic turnout, in response, looks wobbly, especially among minority voters.


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There’s One Unspeakable Fix That Would Help Pay for the GOP’s Tax Cuts

Posted on November 5th, 2017 at 23:02 by John Sinteur in category: News

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Paying for tax reform is easy—as long as the White House and Congress don’t mind fixing climate change at the same time.

That’s the counterintuitive pitch of Robert Litterman, a financial economist who became famous on Wall Street in the 1990s for co-inventing a method (PDF) for allocating assets within a portfolio. He went on to become Goldman Sachs Group Inc.’s top risk manager and then led its quantitative asset management investments until he left in early 2010. Today, he’s the chairman of the Risk Committee at Kepos Capital.

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A $25 per ton carbon tax would go a long way—almost $1 trillion over 10 years, according to the Congressional Budget Office—toward balancing out the cost of reforms. Congress has approved a 2018 budget resolution that allows room for enough tax reform to increase the federal deficit by $1.5 trillion over 10 years, not accounting for growth sparked by the changes.

 Yet, to call a carbon tax dead on arrival would be an insult to dead things, since they have spent at least some time being alive.

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