Wednesday, April 25, 2012

But He Could Pay It Back

How did student loans end up being a big topic of discussion for President Barry?  How did they end up being a big topic of discussion for a bunch of people, really?  I mean, we're talking about student loans here.  No one was forced to take out these loans.  Nor was anyone forced to take out an exorbitant amount of money with whatever interest rate came along with that money.  So why are some people acting like because they can't afford to pay for a decision that they made on their own, that their loans should be forgiven or something like that because they can't afford to pay them back?  That's the confusing part for me.

Now President Barry is in on it.  And what he has to say about it, I find to be absolutely ridiculous.  According to the Huffington Post, President Barry was at the University of North Carolina at Chapel Hill giving a speech to students who I imagine just as eager as can be to lap up what he was saying.  And what he was saying was something along the lines of "We didn't come from wealthy families. So when we graduated from college and grad school, we had a mountain of debt. When we got married, we got poorer together."  He didn't appear to mention that he did receive a scholarship to Occidental College.  And those will help!  But left out that part.  It's hard to make people feel responsible for themselves when you want to make sure that they feel as if everything is stacked against them. But here's the part that I found astonishing.  He apparently mentioned that "they only finished paying off their student loans about eight years ago." 

Let's take a look at that.  He finished paying off his loans in 2004.  Now, he attended Harvard Law School, so I'm pretty sure that someone as smart as he is didn't go into it thinking that it would be cheap.  I did some calculations and with the aid of an inflation calculator I figured out that three years at Harvard Law from 1989-1991 when he graduated would have been about $131,678.09 at the time.  (Adjusted in 2010 dollars, tuition is $47,600 per year plus $25,000 for "room, board, books, travel and personal".  I don't know about you, but when I went to college, I didn't have any travel expenses.  Then again, I didn't go to Harvard.)  I have no idea what sort of loan he took out, so I don't know what sort of interest he paid.  Again, he didn't mention that stuff. 

So he graduated in 1991 and it took him 13 years to pay off his student loans.  That comes out to a payment of around $1,149.63 per month.  Now that's just for himself.  He did say "we had a mountain of debt".  Michelle went to Princeton on a scholarship, but she also went to Harvard Law School, so let's assume that she had the same amount of debt and owed a payment of around $1,149.63 per month.  That's  $2,299.26 per month.  Again, this is without interest.  Add on about 5% interest makes another $57.48 per month per loan or $114.96 per month for both.  That would make their total monthly payment around $2,414.22.  For thirteen years. 

So, let me get this straight.  He and his wife went to Harvard freaking Law School and racked up loans for (by my estimation) somewhere around $263356.18.  For those of you unfamiliar with numbers, that's over a quarter of a million dollars.  Is he really complaining about making enough money with a Harvard law degree that he was about to pay back over a quarter of a million dollars in only thirteen years?  You have to be kidding me. 

See, it needs to be pointed out here that he went to a prestigious university that cost an incredibly insane amount of money, but earned a degree that was actually at least worth what he paid for it.  He didn't go to Harvard and pay that sort of money just to end up with an art history degree which he would then use as a qualification to make my caramel macchiato at Starbucks.  What did he think was going to happen when he went to Harvard?  Probably exactly what actually happened.  He accumulated a debt that he would be able to pay off.  (After all, he graduated in 1991 and was first elected as a US Senator in 1996.  Senators make $165,200 now which is the equivalent of $120,129 in 1996.  So only 5 years out of college and he was definitely making over $100,000 per year.  And that's not to say that he wasn't making at least that much before then.  That's just a definite figure for a definite year.  Michelle was making at least that much as well.  Actually, from what I can figure out, she was probably making more than him for a while.) 

The point here is that he took on debt that he could afford.  That's not a problem.  These people that take on massive amount of debt when they're not going to Harvard and then they don't make a ton of money because they got a degree that doesn't exactly print money (theater and fashion majors, I'm looking at you) are the ones that are the problem.  It's not the same.  And I don't see why taxpayer dollars (Translation: my money) should be going to pay off loans for people who took them out when they couldn't afford them.  I'm not saying that the system is perfect.  But I am saying that there are a lot of people complaining about things that are totally their own doing.  And I'm getting a little tired of fixing other people's problems.


I can't believe that he stood up there and acted like only paying off his student loans eight years ago was some sort of a big deal when he and Michelle likely had over $260,000 in debt to pay back. And it only took him thirteen years!  That seems like awfully quick for the amount of money that was involved.  But those students at UNC Chapel Hill just lapped it all up.  Since when did disillusioning the young in this manner become a fashionable thing to do?  Getting a college education is SO important.  Getting it at the expense of your future financial stability is not a good idea.  Can't we push that message a little bit more?  Just a little?  Please? 

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