Folks are growing concerned about the magnitude of, and problems associated with, the massive student loan situation, and the some are even calling it a scam.
Defaults have fallen for most forms of consumer debt as the economic expansion continues. Mortgage delinquencies last quarter hit a historic low. But severely delinquent student loans have soared since 2012 and are now 35% of “severe derogatories”—more than credit cards (23%), auto loans (21%), and mortgages (11%).
This “scam” is laid at the feet of the CBO during the Obama administration. It’s certainly true that the CBO misread the situation, perhaps even negligently so.
Here’s the short and sweet of it, though.
The student loan overhang is a serious problem. However, the real scam is that of so many Progressive-Democratic Party Presidential candidates who want to forgive all those loans—transferring the loan problem directly onto the backs of taxpayers, instead of leaving it where it belongs: the responsibility of the students and parents who borrowed so foolishly and of the lenders who so foolishly loaned.