Even the supplicant Wall Street Journal can’t turn their head from the crime scene. If you get under the yellow tape and put on your forensic gloves you will find that Americans now owe more on their student loans than their credit cards and this bodes very badly for both working students and society as a whole. For as education is bundled like sticks to be sold as mere kindling for profits, we the taxpayers are looking down the rifle of one of the biggest bail-outs, or is it a ‘rescue plan’, for the barely regulated publicly traded crime syndicates that call themselves colleges and universities. In reality, they are little more than purveyors of purgatory and have now locked students into debt peonage and transferred the costs of Title IV funds (which they get from the government for each student body they enroll) to the public debt. The companies keep the profits. We pay the costs for the mounting defaults.
According to Mark Kantrowitz, publisher of FinAid.org and FastWeb.com:
“Americans owe some $826.5 billion in revolving credit, according to June 2010 figures from the Federal Reserve. (Most of revolving credit is credit-card debt.) Student loans outstanding today — both federal and private — total some $829.785 billion (August 9, 2010, Mary Pilon Student-Loan Debt Surpasses Credit Cards, http://blogs.wsj.com/economics/2010/08/09/student-loan-debt-surpasses-credit-cards/).
Daily Censored has published the staggering statistics for some time now. You can see all the articles under my name at the Author Post section of this website.
From Kantrowitz’s point of view the theme is the same:
“The growth in education debt outstanding is like cooking a lobster. The increase in total student debt occurs slowly but steadily, so by the time you notice that the water is boiling, you’re already cooked” (ibid).
Right, Mark it is a criminal enterprise that is operating stark naked on the surface of society, indebting students for life with business plans that could only be conceived by a ‘mafia’ or criminal syndicate.
By Kantrowitz’s estimations there is $605.6 billion in federal student loans outstanding and $167.8 billion in private student loans outstanding. His tabulations show that $300 billion in federal student loan debts have been incurred in the last four years; this, while Americans were asleep and the corporate media purposely concealed the story. Could it be this might be the result of the fact that the Washington Post is on a financial drip system tethered to one of the criminal enterprises, Kaplan ‘University’? I certainly think so and would point readers to the article I wrote about the ties between Donald Graham’s WOP and Kaplan (http://dailycensored.com/2010/07/27/kaplan-university-blood-bank-for-the-washington-post/). But it is not just the Post, it is all the media who have covered up this little bit of kleptomania.
The Wall Street Journal goes on to dribble about the crisis that is the bubble breaking right now as you read this:
“Partially, this is a story about Americans paying down credit card debt. Some are seeking a new frugality, but many credit card companies are raising minimum monthly payments or cutting off new and existing lines that consumers in the past may have turned to during tough times. Revolving credit, the majority of which is credit card debt, reached a high in September 2008 of $975.7 billion, according to Fed data. A consumer who juggles both credit-card and student-loan debt is likely to pay of the credit-card first, as that debt tends to carry a higher interest rate (ibid).
Nice try, Ruppert Murdock (owner of the WSJ and Fox News), but your paper along with Donald Graham’s publicly traded Washington Post are gatekeepers for the criminal enterprise — the Rip Van Winkles. Just take a look at the reporting by the WSJ and how it conceals more than it reveals:
“Tuition at public and private four-year universities last year went as high as $26,000, with additional fees for housing and books not showing any signs of letting up either. It’s no surprise that many parents, reeling from the downturn, would turn to borrowing to make up the difference. With the cost of education increasing rapidly and the duration of unemployment increasing, perhaps the surprise is that this turning point didn’t hit earlier (ibid).
Try $80,000 a year to get a bachelor’s degree in Homeland Security, or $30,000 to get a ‘Surgical Technical’ degree at Kaplan University. Culinary and Arts ‘education’ is being peddled for more than $50,000! A whole swath of surveillance and criminal justice ‘degrees’ are being auctioned off for as much if not more. But of course the Wall Street Journal doesn’t want to scare would be investors in these criminal enterprises and thus will not report the carnage as it really is. Ask the hedge fund operators what they think; they are shorting the stocks.
Even the WSJ couldn’t hide the fact that Student Loan Justice, a Washington State-based student loan advocacy group issued a statement on the student-loan eclipse, estimating that media coverage of credit cards exceeds coverage of student loans “by a factor of approximately 15-to-1 based on unscientific news surveys conducted since 2007” (http://www.studentloanjustice.org/victims.htm).
Defaults mount, taxpayers foot the bill and the private predation continues for profit
You can’t discharge a student loan in bankruptcy like you can a credit card. This is the neo-liberal trick. The for-profit predatory colleges sign up as many ‘borrowers’ as they can – pounding on homeless shelters to recruit bodies, looking for drug addicts they can enroll and all of this with debilitating consequences for borrowers who miss payments and borrowers’ families (http://dailycensored.com/2010/07/19/14027/).
As I reported at www.dailycensored.com:
“The share of borrowers who default on their student loans is bigger than the federal government’s short-term data suggest, with thousands more students facing damaged credit histories and millions more tax dollars being lost in the long run through bail-outs to for-profit colleges. According to unpublished data obtained by The Chronicle of Higher Education, one in every five government loans that entered repayment in 1995 has gone into default. The default rate is higher for loans made to students from two-year colleges, and higher still, reaching 40 percent, for those who attended for-profit institutions” (The Government vastly undercounts defaults, Field, K. July 11, 2010. http://chronicle.com/article/Many-More-Students-Are/66223/#lastComment).
But the for-profit colleges don’t care about working people or their families. They treat children like street urchins. The diploma mills are ‘drive-by’ schools located mainly off of freeway off-ramps and ensconced within large corporate business buildings alongside title companies, real estate companies and in the case of the Phoenix University in Pasadena, they share stable quarters with the Rand Corporation. These predators operate like criminal retail chains, vamping students for dollars while selling education as a commodity on TV wedged in between shows like ‘Cheaters’ and ‘American Most Wanted’. Their practices imprison young and old within a system of debt colonization and peonage and subsidized by the federal government.
You can see that as far back as December of last year, I reported how they work. I will continue to report on their ‘best practices’ and we will see how the Obama administration and their so-called GAO investigations, the Department of Education and the governments own lax regulatory practices handle the crisis; but virtually it is already to late for many students and certainly for taxpayers.
The predation will continue if we do not shut these institutions down. As I stated in dissidentvoice.org back on December 1, 2009:
“What the public might also have missed in the collage of economic downturns and dire prognostications has been the incredible fraud in the federal student loan programs tied to for-profit colleges and universities. Also what is under-reported are the student pay-day loan practices of private banks (bailed-out with stimulus monies and flush with cash) that charge high interest rates and in most cases require co-signers for students to attend these same institutions. Most notoriously, however, what is missing is coverage of the unscrupulous practices of the proprietary colleges, or for-profit colleges, that financially mug students, largely from working and low income families, leaving them burdened and battered with life-long debt in an economy and society bereft of jobs and largely becoming increasingly more militarized” (Private Predatory Colleges: How the Neoliberal Alchemists Turn Debt into Profit and Citizens into Fools http://dissidentvoice.org/2009/12/private-predatory-colleges-how-the-neoliberal-alchemists-turn-debt-into-profit-and-citizens-into-fools).
The Department of Education under George W. Bush and Rod Paige used government deregulation in an effort to help create a system of debt peonage for students while offering larger and very profitable business opportunities to their friends, the proprietary colleges. Now the chickens have come home to roost as Wall Street continues to find ways to bilk the American people and the corporate media continues to hide the crime scene.
It’s a blood stained mess and only promises to get worse as the human lives continue to stack up like corpses in a morgue. It would not surprise me, as I continue to bring news to readers, to find that these colleges have been recruiting the dead for Title IV taxpayer funds, names simply taken from graveyards and then posthumously rewarded degrees while the federal monies snake their way onto profit spread sheets and taxpayers face mounting criminal deficits caused by the profit maximizers, the predatory colleges that dress-up for their victims as educational sites when in fact they are little more than crime scenes. Take a look for yourselves. The vampires never sleep, the coffins are open 24/7!
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