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One percent

Screwing the young just a little bit more

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Just now, Frank Hovis said:

RPI + 3%.  Wow.  Anyone would invest in a bond that offered that. it's a FANTASTIC rate.

Though obviously not so good if you're paying it.

And the government sold off the student loan book to their friends in the city a couple of years ago. 

Trebles all round. 

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It is an absolute disgrace.

The thing is, interest rates on debt are (inflation) + risk.  But there is no risk on default on student loans -- they have to pay and they're not even discharged on bankruptcy.  Sure, some people might not pay it all back or might disappear or die or something -- but most of that is the fault of the way the loans were written, and not of the actual student.

Given the risk (zero) the interest rates should equal inflation.

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It's just a graduate tax... Get over it! xD

Quote

A graduate tax is the hipster’s choice for funding higher education. It is what politicians turn to when they want to sound alternative (but not too alternative) when it comes to paying for universities.


How do we get graduates who move abroad to pay back their student loan?

Unfortunately, like craft beer and waxed moustaches, it is a terrible idea. But Labour leadership candidate Owen Smith has pulled the graduate tax out of the cupboard of policy ideas once more, so let’s look at it again.

When Tony Blair’s government proposed tuition fees in 2002, the Treasury let it be known that Gordon Brown preferred a graduate tax. It did not happen. In 2010, Ed Miliband made a graduate tax a plank of his successful leadership campaign. Again, Labour wrestled with the idea, but it did not happen. In coalition, Vince Cable asked Lord Browne to look at the possibility of the tax. It was quickly shelved.

Politicians invoke a graduate tax in an attempt to shift the vocabulary of higher education funding away from individual debt towards a general principle of progressive taxation. The problem is that whenever you look at the practicalities, the idea falls apart in your hands.

Why doesn’t it work?
Like the current fees model, a graduate tax operates on the principle that those who benefit from universities should pay for them. Like the present system, the money would be collected by HMRC and the tax could be designed to be contingent on income.

But there is currently a limit to the amount graduates pay. Once you have paid back the cost of your own education, the payments stop. Under a graduate tax the payments would, in theory, go on in perpetuity, long after you had paid for your own studies.

Fuckin' socialist that hate tax... that's the definition of an oxymoron.

Source :- https://www.theguardian.com/higher-education-network/2016/sep/07/graduate-tax-history-bad-idea

You are not supposed to pay it back, the total and interest rate are irrelevant. You pay an extra % in tax on your earning forever.... that's the point. Higher interest rates make this possible.

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Just now, Dave Beans said:

I paid off my student loan of about twenty years, about six months ago.  Thank fuck that I don't have to worry about any of this bollocks.  So glad to be debt free! 

And that's why the student loan scheme is insidious. The rich get daddy to pay it off and so don't pay the tax while the poor (who actually made it) pay it forever... Ha HA HA HA HA!  

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1 minute ago, XswampyX said:

And that's why the student loan scheme is insidious. The rich get daddy to pay it off and so don't pay the tax while the poor (who actually made it) pay it forever... Ha HA HA HA HA!  

If your desperate to get a degree, I'd now either get an employer to pay for it, or do a distance learning course (unless its impossible to do otherwise).  As these types of courses become ever more mainstream, many traditional "brick" universities are doomed...  

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5 minutes ago, XswampyX said:

And that's why the student loan scheme is insidious. The rich get daddy to pay it off and so don't pay the tax while the poor (who actually made it) pay it forever... Ha HA HA HA HA!  

No. It's stupid because the useless wasters get four years pissing about knowing they will never have to pay it off as they will never earn enough. Whereas the ambitious are deterred because they know they will be paying it for many, many years.

It is an inverse incentive.

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Just now, Cunning Plan said:

No. It's stupid because the useless wasters get four years pissing about knowing they will never have to pay it off as they will never earn enough. Whereas the ambitious are deterred because they know they will be paying it for many, many years.

It is an inverse incentive.

I can see where you are coming from but... how long before the minimum wage gets you into the "pay off your student loan" zone, 10 years?

Yep, I can laugh because I don't have to pay it. xD

Average wage 1970 = £1,204

Average wage 1980 = £5,069

Read it and weep. Source :- http://thedesignlab.co.uk/costofliving2015/ukupdate.php?uid=81

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1 minute ago, XswampyX said:

I can see where you are coming from but... how long before the minimum wage gets you into the "pay off your student loan" zone, 10 years?

Yep, I can laugh because I don't have to pay it. xD

Average wage 1970 = £1,204

Average wage 1980 = £5,069

Read it and weep. Source :- http://thedesignlab.co.uk/costofliving2015/ukupdate.php?uid=81

No because they have just increased the floor before you start paying, and will continue to do so.

I can also laugh because, despite being offered a place, I couldn't afford to go.

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3 minutes ago, Cunning Plan said:

No because they have just increased the floor before you start paying, and will continue to do so.

Maybe or that's just an arbitrary number that they can raise and lower in order to twist the electorate's balls.

It's just another hammer to beat somebody us with. 

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3 minutes ago, XswampyX said:

Maybe or that's just an arbitrary number that they can raise and lower in order to twist the electorate's balls.

It's just another hammer to beat somebody us with. 

It is the one and only thing they can't beat me with. And I have made sure they can't beat my kids either.

Edited by Cunning Plan

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Isn't t this just deliberately designed to stoke inter generational tension so that the masses squabble amongst themselves rather than stringing up their rulers from the nearest lamp post. Of course, the reality is that the transfer of wealth going here is not from the young to the old but from the many to the few. The student loan system is a mirror image of the tax and benefit system in the UK where it pays either to be poor or rich but not in the middle.

 

Edited by Virgil Caine

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44 minutes ago, dgul said:

The other thing about student loans is 'who is punished most'.

  • The people that pay most out of their lifetime income are those that end up almost exactly paying it all off when they're at +25 years.  This works out as a term average of £30-50k.
  • If you earn more you'll pay more per year, but you'll pay it off sooner, and won't have so much interest to pay.  And it can be quite a lot of interest -- for a person starting out at a low salary (no repayment), but then getting a decent salary in their later years that 6+% will really accrue.
  • If you earn less you'll pay less per year, and have it discharged at +25 years anyway.

So, this is what we all want?  The ones going to college and then earning a decent but not extortionate salary to pay the most?  The normal folk that make the professional world work?  Oh, and we want the really high earners to pay the least?  Well, apart from the dossers that we paid to go to college, but then didn't get any work worth talking about?

It is an absolutely crazy system.  It delivers exactly the opposite of what I'd want to happen. 

[What I'd like is there to be a national sponsorship scheme, absolutely thousands of people identified and put through college, to study things that we want them to study; nurses, doctors, sure, but physicists, geologists, historians, musicians, even media studies -- all in proportion to what the country thinks is needed in the future.  I'd want the sponsorship to be massive (30% of students, say) and based entirely on merit.  Then those picked for the sponsorship would have their loans paid off so long as they were working in the field that we sponsored them to be in.  Want to go but aren't good enough for a sponsorship?  Fine, but I don't need you to be doing it and I don't want to pay for it.  Similarly, want to get a job in a different field?  Fine, but I want that good money I paid for you to study back.  Oh, and the debt for the non-sponsorship ones at RPI -- there is no justification for anything else.]

And, I absolutely hate the current system for what it'll bring.  Those students that have been taken advantage of will be in positions of power in 30 years time.  And they won't look kindly to little me as one of the ones that screwed them over.  I want to shout Be kind to the young, because eventually you'll need them to be kind to you.

My belief has always that their should be a fixed sum of money allocated to fund bursaries for University study in chosen subjects. These would be awarded purely on merit to the best qualified students. Everyone else would have to fund their education through commercial loans where the lender would define the amount and rate of interest based on the likelihood of repayment. Putting mediocre students into massive amounts of debt so that they can take degrees of dubious merit seems an act of gross cruelty.

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9 minutes ago, Virgil Caine said:

Isn't t this just deliberately designed to create inter generational tension so that the masses squabble amongst themselves rather than stringing up their rulers from the nearest lamp post. Of course, the reality is that the transfer of wealth going here is not from the young to the old but from the many to the few. The student loan system is a mirror image of the tax and benefit system in the UK where it pays either to be poor or rich but not in the middle.

 

It's about creating money. Fly free new money and find your new owners!

That's it. The rest is just sophistry.

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9 minutes ago, XswampyX said:

It's about creating money. Fly free new money and find your new owners!

That's it. The rest is just sophistry.

The screwing of students is clearly part of a deliberate attempt to divide the generations and then to use that as an opportunity to fleece both groups

It is no surprise to find that David Willetts who is always bleating about intergenerational fairness was the person who trebled student tuition fees as a government minister

https://www.theguardian.com/politics/2011/nov/20/david-willetts-university-student-loans-debt

The man is a complete cunt.

Edited by Virgil Caine

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4 minutes ago, Virgil Caine said:

The screwing of students is clearly part of a deliberate attempt to divide the generations and then to use that as an opportunity to fleece both groups

It is no surprise to find that David Willetts who is always bleating about intergenerational fairness was the person who trebled student tuition fees as a government minister

https://www.theguardian.com/politics/2011/nov/20/david-willetts-university-student-loans-debt

The man is a complete cunt.

I don't think it is.

What's the point of a graduate tax if it has to come out of money already in circulation when a student loan creates the money now whether it's paid back later or not (too late it's already out in the economy). Who gives a fuck?

 

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11 minutes ago, XswampyX said:

I don't think it is.

What's the point of a graduate tax if it has to come out of money already in circulation when a student loan creates the money now whether it's paid back later or not (too late it's already out in the economy). Who gives a fuck?

 

I am not in favour of a graduate tax. 

I think funding not very academic students to take degrees of dubious quality  is a waste of money period.

Moreover, the money that is out into circulation now as part of these loans  is going to be clawed back later with interest so it is going to effectively reduce the spending power of students after graduation.

Personally I think it would make more economic sense to lend many of these youngsters money to go down the pub or buy cigarettes as the money would circulate wider and  more quickly in the economy and come back quicker in excise duty taxes.

 

Edited by Virgil Caine

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Just now, Virgil Caine said:

I am not in favour of a graduate tax. 

I think funding not very academic students to take degrees of dubious quality  is a waste of money period.

Moreovert, the money that is out into circulation now as part of these loans  is going to be clawed back later with interest so it is going to effectively reduce the spending power of students after graduation.

Personally I think it would make more economic sense to lend many of these youngsters money to go down the pub or buy cigarettes as the money would circulate wider and  more quickly in the economy and come back quicker in excise duty taxes.

 

I don't disagree.

I'm trying to put across why it's done like this, not how I'd like it to be done.

It's just as I see it. 

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5 minutes ago, XswampyX said:

I don't disagree.

I'm trying to put across why it's done like this, not how I'd like it to be done.

It's just as I see it. 

I agree that all the loan money ends up in the economy but I don't think it is going to create any greater benefit to most students or the wider economy than lending them money to buy rounds of drinks.

Edited by Virgil Caine

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Odd how that in the rather poor economy of the early 80s I was able to do a degree for nothing. All this will end badly.:o. Education is

the business of the state, not banks. That was very Socialist of me! Although the government back then thought it could run the car industry aswell.

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7 hours ago, Cunning Plan said:

It should always have been something like an extra 2% on employers NI for all graduate employees no matter when they graduated. That was the only fair way.

No. Not just this.

There needs to be a cost borne by the Uni and lectureres.

As t stands, the HE sector get to make up claims and flip the ost onto the student and the tax payer.

There needs to e a feedback in place for the HE sector - if 70& of graduates fail to earn national minimum age ~ 30% within 3 years of graduating then the loan costs must be clawed back from the Uni and lecturers.

As it stand, you have a vast number of HE orgs and people feeding on the young.

If going to Uni is worth than it needs to be proven. If its not the HE sector need s to be gutted.

SImilar thng with that idoopt Browns other great idea - cannot leave school til 18. Thats fine but most people who leave at 17 have already been failed by the schools. Forcing them to spend abother2 years with a loads of moron, makeup education types is just going to confirm that.

Both cases of the public sector sucking tax.

 

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