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On July 19 2013 01:01 Klondikebar wrote:Show nested quote +On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. Well wealth is still finite. So if we have 100 units of wealth spread among $100, $1 represents 1 unit of wealth. When the government suddenly says "NOW THERE ARE $200!!!" then suddenly each $1 represents only 0.5 units of wealth. The opportunity cost is actually even steeper here because that 50 units of wealth just got taken away from it's highest efficiency use and put in student loans. What's absolutely perverse is that the cost of writing those loans is shouldered soley by taxpayers, the cost of interest is shouldered entirely by students, but the profit always ends up in the hands of banks. It's like the exact opposite of a free market structure.
This is not how currency works. Especially loans. Printing money and loaning can create circulation and wealth.
Here's a really basic example of how it works: Baby-Sitting the Economy
And the banks got kicked out of the student loan industry. They used to be a middle-man, but they stopped that because of this reason.
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On July 19 2013 01:07 DoubleReed wrote:Show nested quote +On July 19 2013 01:01 Klondikebar wrote:On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. Well wealth is still finite. So if we have 100 units of wealth spread among $100, $1 represents 1 unit of wealth. When the government suddenly says "NOW THERE ARE $200!!!" then suddenly each $1 represents only 0.5 units of wealth. The opportunity cost is actually even steeper here because that 50 units of wealth just got taken away from it's highest efficiency use and put in student loans. What's absolutely perverse is that the cost of writing those loans is shouldered soley by taxpayers, the cost of interest is shouldered entirely by students, but the profit always ends up in the hands of banks. It's like the exact opposite of a free market structure. This is not how currency works. Especially loans. Printing money and loaning can create circulation and wealth. Here's a really basic example of how it works: Baby-Sitting the EconomyAnd the banks got kicked out of the student loan industry. They used to be a middle-man, but they stopped that because of this reason.
Thank you for that. I am aware that additional currency can create liquidity. I obviously was not talking about that. I was assuming $100 with enough liquidity to be a normal economy.
In the context of your article this would be like if the scrip could also be spent on cookies. And whoever was oversee-ing the coop decided everyone should be eating lots of cookies so they printed a bunch of extra scrip and then made cookies super cheap even though most of the people in the coop were already fat. The scrip was incredibly devalued for buying babysitting hours and everyone gets diabetes.
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Post-secondary education (be it college, community college, or vocational training) should be just subsidized, wholly or partially, for the same reasons that public education is subsidized. Education is, simply, the cornerstone of a responsible and competent citizenry. There is absolutely no reason not to make it as accessible as possible. Obviously, if this were done, one would have to substantially tighten the restrictions on entrance to various post-secondary institutions, in order to prevent people with no aptitude/ability wasting resources i.e. we don't need people going into English literature if they can't piece together a sentence, and nor do we need someone with poor fine motor skills training to be a surgeon or fine woodworker.
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On July 19 2013 01:04 Klondikebar wrote:Show nested quote +On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! The ideal way to finance a government is almost entirely by debt. But this requires an economy that grows...a lot. The government collects only enough taxes to pay the interest, and then the economy simply outgrows the debt burden. The idea of "profit" in an institution that is both supposed to not be concerned with it and has a monopoly on the use of force worries me.
Financing just with debt would also require a very high interest rate in order to induce that much saving. You'd also have to worry about crowding out all other private borrowing. But that is neither here nor there. If you don't like the government turning a profit on an activity - why let it collect taxes? That has to be the highest margin activity ever!
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On July 19 2013 01:21 JonnyBNoHo wrote:Show nested quote +On July 19 2013 01:04 Klondikebar wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! The ideal way to finance a government is almost entirely by debt. But this requires an economy that grows...a lot. The government collects only enough taxes to pay the interest, and then the economy simply outgrows the debt burden. The idea of "profit" in an institution that is both supposed to not be concerned with it and has a monopoly on the use of force worries me. Financing just with debt would also require a very high interest rate in order to induce that much saving. You'd also have to worry about crowding out all other private borrowing. But that is neither here nor there. If you don't like the government turning a profit on an activity - why let it collect taxes? That has to be the highest margin activity ever!
Right, a phenomenal economy tends to have a fairly high savings rate because consumption desires are easily met with phenomenal incomes. Again, I'm talking about the absolute best possible scenario here. Steps toward that scenario aren't a bad thing.
And why is collecting taxes inherently profitable? Profits are revenues that exceed expenses. The government shouldn't be exceeding its expenses. When it undertakes a project or program, it ought to collect enough money to equal expenses and no more. If taxes are a profitable revenue stream then that means someone is lining their pockets with money collected by force, that sounds like corruption.
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On July 19 2013 01:26 Klondikebar wrote:Show nested quote +On July 19 2013 01:21 JonnyBNoHo wrote:On July 19 2013 01:04 Klondikebar wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! The ideal way to finance a government is almost entirely by debt. But this requires an economy that grows...a lot. The government collects only enough taxes to pay the interest, and then the economy simply outgrows the debt burden. The idea of "profit" in an institution that is both supposed to not be concerned with it and has a monopoly on the use of force worries me. Financing just with debt would also require a very high interest rate in order to induce that much saving. You'd also have to worry about crowding out all other private borrowing. But that is neither here nor there. If you don't like the government turning a profit on an activity - why let it collect taxes? That has to be the highest margin activity ever! Right, a phenomenal economy tends to have a fairly high savings rate because consumption desires are easily met with phenomenal incomes. Again, I'm talking about the absolute best possible scenario here. Steps toward that scenario aren't a bad thing. And why is collecting taxes inherently profitable? Profits are revenues that exceed expenses. The government shouldn't be exceeding its expenses. When it undertakes a project or program, it ought to collect enough money to equal expenses and no more. If taxes are a profitable revenue stream then that means someone is lining their pockets with money collected by force, that sounds like corruption.
I'm using the same methodology as saying student loans are profitable. The IRS costs way less than the taxes it collects. So it's profitable. Student loans cost less than the revenue they generate, so they are profitable. But both sources of revenue are used to fund the general government. Government could not exist otherwise.
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On July 19 2013 01:32 JonnyBNoHo wrote:Show nested quote +On July 19 2013 01:26 Klondikebar wrote:On July 19 2013 01:21 JonnyBNoHo wrote:On July 19 2013 01:04 Klondikebar wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! The ideal way to finance a government is almost entirely by debt. But this requires an economy that grows...a lot. The government collects only enough taxes to pay the interest, and then the economy simply outgrows the debt burden. The idea of "profit" in an institution that is both supposed to not be concerned with it and has a monopoly on the use of force worries me. Financing just with debt would also require a very high interest rate in order to induce that much saving. You'd also have to worry about crowding out all other private borrowing. But that is neither here nor there. If you don't like the government turning a profit on an activity - why let it collect taxes? That has to be the highest margin activity ever! Right, a phenomenal economy tends to have a fairly high savings rate because consumption desires are easily met with phenomenal incomes. Again, I'm talking about the absolute best possible scenario here. Steps toward that scenario aren't a bad thing. And why is collecting taxes inherently profitable? Profits are revenues that exceed expenses. The government shouldn't be exceeding its expenses. When it undertakes a project or program, it ought to collect enough money to equal expenses and no more. If taxes are a profitable revenue stream then that means someone is lining their pockets with money collected by force, that sounds like corruption. I'm using the same methodology as saying student loans are profitable. The IRS costs way less than the taxes it collects. So it's profitable. Student loans cost less than the revenue they generate, so they are profitable. But both sources of revenue are used to fund the general government. Government could not exist otherwise.
Saying the IRS is profitable is like saying the accounts receivable department of a company is profitable. Obviously the department that collects all the revenue while incurring close to zero of the operating/production costs is going to be "profitable." That's not a meaningful thing to say.
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On July 19 2013 00:59 JonnyBNoHo wrote:Show nested quote +On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. Show nested quote +On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket!
We're talking about net here. Even in taxes, the ideal situation is that they take in slightly less than is needed for services. Surpluses are (questionably) just as bad as bloated government, where you're taking resources/potential away from the private sector, thus "wasting" it.
On July 19 2013 01:32 JonnyBNoHo wrote:Show nested quote +On July 19 2013 01:26 Klondikebar wrote:On July 19 2013 01:21 JonnyBNoHo wrote:On July 19 2013 01:04 Klondikebar wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! The ideal way to finance a government is almost entirely by debt. But this requires an economy that grows...a lot. The government collects only enough taxes to pay the interest, and then the economy simply outgrows the debt burden. The idea of "profit" in an institution that is both supposed to not be concerned with it and has a monopoly on the use of force worries me. Financing just with debt would also require a very high interest rate in order to induce that much saving. You'd also have to worry about crowding out all other private borrowing. But that is neither here nor there. If you don't like the government turning a profit on an activity - why let it collect taxes? That has to be the highest margin activity ever! Right, a phenomenal economy tends to have a fairly high savings rate because consumption desires are easily met with phenomenal incomes. Again, I'm talking about the absolute best possible scenario here. Steps toward that scenario aren't a bad thing. And why is collecting taxes inherently profitable? Profits are revenues that exceed expenses. The government shouldn't be exceeding its expenses. When it undertakes a project or program, it ought to collect enough money to equal expenses and no more. If taxes are a profitable revenue stream then that means someone is lining their pockets with money collected by force, that sounds like corruption. I'm using the same methodology as saying student loans are profitable. The IRS costs way less than the taxes it collects. So it's profitable. Student loans cost less than the revenue they generate, so they are profitable. But both sources of revenue are used to fund the general government. Government could not exist otherwise.
Unless you're advocating a regressive tax system, you're going to be hard pressed to justify why student loans (that are based on income) should provide net profit to the government.
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On July 19 2013 01:35 Klondikebar wrote:Show nested quote +On July 19 2013 01:32 JonnyBNoHo wrote:On July 19 2013 01:26 Klondikebar wrote:On July 19 2013 01:21 JonnyBNoHo wrote:On July 19 2013 01:04 Klondikebar wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! The ideal way to finance a government is almost entirely by debt. But this requires an economy that grows...a lot. The government collects only enough taxes to pay the interest, and then the economy simply outgrows the debt burden. The idea of "profit" in an institution that is both supposed to not be concerned with it and has a monopoly on the use of force worries me. Financing just with debt would also require a very high interest rate in order to induce that much saving. You'd also have to worry about crowding out all other private borrowing. But that is neither here nor there. If you don't like the government turning a profit on an activity - why let it collect taxes? That has to be the highest margin activity ever! Right, a phenomenal economy tends to have a fairly high savings rate because consumption desires are easily met with phenomenal incomes. Again, I'm talking about the absolute best possible scenario here. Steps toward that scenario aren't a bad thing. And why is collecting taxes inherently profitable? Profits are revenues that exceed expenses. The government shouldn't be exceeding its expenses. When it undertakes a project or program, it ought to collect enough money to equal expenses and no more. If taxes are a profitable revenue stream then that means someone is lining their pockets with money collected by force, that sounds like corruption. I'm using the same methodology as saying student loans are profitable. The IRS costs way less than the taxes it collects. So it's profitable. Student loans cost less than the revenue they generate, so they are profitable. But both sources of revenue are used to fund the general government. Government could not exist otherwise. Saying the IRS is profitable is like saying the accounts receivable department of a company is profitable. Obviously the department that collects all the revenue while incurring close to zero of the operating/production costs is going to be "profitable." That's not a meaningful thing to say.
Of course it isn't meaningful. That's the point 
You are then supposed to relate that stupid statement with the statement that student loans, horror of horrors, are profitable. Again, why is this such a bad thing? The government uses that profit to fund education and other government functions.
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On July 19 2013 01:39 aksfjh wrote:Show nested quote +On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! We're talking about net here. Even in taxes, the ideal situation is that they take in slightly less than is needed for services. Surpluses are (questionably) just as bad as bloated government, where you're taking resources/potential away from the private sector, thus "wasting" it.
It would depend on what happens to that surplus.
Show nested quote +On July 19 2013 01:32 JonnyBNoHo wrote:On July 19 2013 01:26 Klondikebar wrote:On July 19 2013 01:21 JonnyBNoHo wrote:On July 19 2013 01:04 Klondikebar wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! The ideal way to finance a government is almost entirely by debt. But this requires an economy that grows...a lot. The government collects only enough taxes to pay the interest, and then the economy simply outgrows the debt burden. The idea of "profit" in an institution that is both supposed to not be concerned with it and has a monopoly on the use of force worries me. Financing just with debt would also require a very high interest rate in order to induce that much saving. You'd also have to worry about crowding out all other private borrowing. But that is neither here nor there. If you don't like the government turning a profit on an activity - why let it collect taxes? That has to be the highest margin activity ever! Right, a phenomenal economy tends to have a fairly high savings rate because consumption desires are easily met with phenomenal incomes. Again, I'm talking about the absolute best possible scenario here. Steps toward that scenario aren't a bad thing. And why is collecting taxes inherently profitable? Profits are revenues that exceed expenses. The government shouldn't be exceeding its expenses. When it undertakes a project or program, it ought to collect enough money to equal expenses and no more. If taxes are a profitable revenue stream then that means someone is lining their pockets with money collected by force, that sounds like corruption. I'm using the same methodology as saying student loans are profitable. The IRS costs way less than the taxes it collects. So it's profitable. Student loans cost less than the revenue they generate, so they are profitable. But both sources of revenue are used to fund the general government. Government could not exist otherwise. Unless you're advocating a regressive tax system, you're going to be hard pressed to justify why student loans (that are based on income) should provide net profit to the government.
Degree holders typically have more earning power than those without degrees. Those who receive subsidized loans are receiving an implicit government benefit. Even if the government is turning a profit it's still a progressive system.
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On July 19 2013 01:52 JonnyBNoHo wrote:Show nested quote +On July 19 2013 01:39 aksfjh wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! We're talking about net here. Even in taxes, the ideal situation is that they take in slightly less than is needed for services. Surpluses are (questionably) just as bad as bloated government, where you're taking resources/potential away from the private sector, thus "wasting" it. It would depend on what happens to that surplus. Show nested quote +On July 19 2013 01:32 JonnyBNoHo wrote:On July 19 2013 01:26 Klondikebar wrote:On July 19 2013 01:21 JonnyBNoHo wrote:On July 19 2013 01:04 Klondikebar wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:[quote] Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! The ideal way to finance a government is almost entirely by debt. But this requires an economy that grows...a lot. The government collects only enough taxes to pay the interest, and then the economy simply outgrows the debt burden. The idea of "profit" in an institution that is both supposed to not be concerned with it and has a monopoly on the use of force worries me. Financing just with debt would also require a very high interest rate in order to induce that much saving. You'd also have to worry about crowding out all other private borrowing. But that is neither here nor there. If you don't like the government turning a profit on an activity - why let it collect taxes? That has to be the highest margin activity ever! Right, a phenomenal economy tends to have a fairly high savings rate because consumption desires are easily met with phenomenal incomes. Again, I'm talking about the absolute best possible scenario here. Steps toward that scenario aren't a bad thing. And why is collecting taxes inherently profitable? Profits are revenues that exceed expenses. The government shouldn't be exceeding its expenses. When it undertakes a project or program, it ought to collect enough money to equal expenses and no more. If taxes are a profitable revenue stream then that means someone is lining their pockets with money collected by force, that sounds like corruption. I'm using the same methodology as saying student loans are profitable. The IRS costs way less than the taxes it collects. So it's profitable. Student loans cost less than the revenue they generate, so they are profitable. But both sources of revenue are used to fund the general government. Government could not exist otherwise. Unless you're advocating a regressive tax system, you're going to be hard pressed to justify why student loans (that are based on income) should provide net profit to the government. Degree holders typically have more earning power than those without degrees. Those who receive subsidized loans are receiving an implicit government benefit. Even if the government is turning a profit it's still a progressive system.
If it's a surplus in excess of government programs/projects/and operation costs what could it possibly do except line pockets?
Using the word "profit" in the context of a non-profit institution is doing absolutely nothing but muddying waters. And I'm not just referring to you. I'm referring to the people who are bitching that student loans are "profitable." No. They effing aren't. They are either funding existing government activities or they are lining the pockets of corrupt politicians.
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On July 19 2013 01:58 Klondikebar wrote:Show nested quote +On July 19 2013 01:52 JonnyBNoHo wrote:On July 19 2013 01:39 aksfjh wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! We're talking about net here. Even in taxes, the ideal situation is that they take in slightly less than is needed for services. Surpluses are (questionably) just as bad as bloated government, where you're taking resources/potential away from the private sector, thus "wasting" it. It would depend on what happens to that surplus. On July 19 2013 01:32 JonnyBNoHo wrote:On July 19 2013 01:26 Klondikebar wrote:On July 19 2013 01:21 JonnyBNoHo wrote:On July 19 2013 01:04 Klondikebar wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:
[quote]
Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! The ideal way to finance a government is almost entirely by debt. But this requires an economy that grows...a lot. The government collects only enough taxes to pay the interest, and then the economy simply outgrows the debt burden. The idea of "profit" in an institution that is both supposed to not be concerned with it and has a monopoly on the use of force worries me. Financing just with debt would also require a very high interest rate in order to induce that much saving. You'd also have to worry about crowding out all other private borrowing. But that is neither here nor there. If you don't like the government turning a profit on an activity - why let it collect taxes? That has to be the highest margin activity ever! Right, a phenomenal economy tends to have a fairly high savings rate because consumption desires are easily met with phenomenal incomes. Again, I'm talking about the absolute best possible scenario here. Steps toward that scenario aren't a bad thing. And why is collecting taxes inherently profitable? Profits are revenues that exceed expenses. The government shouldn't be exceeding its expenses. When it undertakes a project or program, it ought to collect enough money to equal expenses and no more. If taxes are a profitable revenue stream then that means someone is lining their pockets with money collected by force, that sounds like corruption. I'm using the same methodology as saying student loans are profitable. The IRS costs way less than the taxes it collects. So it's profitable. Student loans cost less than the revenue they generate, so they are profitable. But both sources of revenue are used to fund the general government. Government could not exist otherwise. Unless you're advocating a regressive tax system, you're going to be hard pressed to justify why student loans (that are based on income) should provide net profit to the government. Degree holders typically have more earning power than those without degrees. Those who receive subsidized loans are receiving an implicit government benefit. Even if the government is turning a profit it's still a progressive system. If it's a surplus in excess of government programs/projects/and operation costs what could it possibly do except line pockets? Using the word "profit" in the context of a non-profit institution is doing absolutely nothing but muddying waters. And I'm not just referring to you. I'm referring to the people who are bitching that student loans are "profitable." No. They effing aren't. They are either funding existing government activities or they are lining the pockets of corrupt politicians.
Generally the surplus would be used to either pay down existing debt or placed in a sovereign wealth fund.
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On July 19 2013 01:52 JonnyBNoHo wrote:Show nested quote +On July 19 2013 01:39 aksfjh wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! We're talking about net here. Even in taxes, the ideal situation is that they take in slightly less than is needed for services. Surpluses are (questionably) just as bad as bloated government, where you're taking resources/potential away from the private sector, thus "wasting" it. It would depend on what happens to that surplus. Show nested quote +On July 19 2013 01:32 JonnyBNoHo wrote:On July 19 2013 01:26 Klondikebar wrote:On July 19 2013 01:21 JonnyBNoHo wrote:On July 19 2013 01:04 Klondikebar wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:[quote] Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! The ideal way to finance a government is almost entirely by debt. But this requires an economy that grows...a lot. The government collects only enough taxes to pay the interest, and then the economy simply outgrows the debt burden. The idea of "profit" in an institution that is both supposed to not be concerned with it and has a monopoly on the use of force worries me. Financing just with debt would also require a very high interest rate in order to induce that much saving. You'd also have to worry about crowding out all other private borrowing. But that is neither here nor there. If you don't like the government turning a profit on an activity - why let it collect taxes? That has to be the highest margin activity ever! Right, a phenomenal economy tends to have a fairly high savings rate because consumption desires are easily met with phenomenal incomes. Again, I'm talking about the absolute best possible scenario here. Steps toward that scenario aren't a bad thing. And why is collecting taxes inherently profitable? Profits are revenues that exceed expenses. The government shouldn't be exceeding its expenses. When it undertakes a project or program, it ought to collect enough money to equal expenses and no more. If taxes are a profitable revenue stream then that means someone is lining their pockets with money collected by force, that sounds like corruption. I'm using the same methodology as saying student loans are profitable. The IRS costs way less than the taxes it collects. So it's profitable. Student loans cost less than the revenue they generate, so they are profitable. But both sources of revenue are used to fund the general government. Government could not exist otherwise. Unless you're advocating a regressive tax system, you're going to be hard pressed to justify why student loans (that are based on income) should provide net profit to the government. Degree holders typically have more earning power than those without degrees. Those who receive subsidized loans are receiving an implicit government benefit. Even if the government is turning a profit it's still a progressive system.
You're taking an awfully big leap there. There are many people that obtain degrees that do not make more (due to the degree or choosing for a more benevolent career path). Even in the best case of earnings, we come across your red flag, "double taxation." They're already paying a higher rate in income tax because of that degree, why must they pay more?
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On July 19 2013 02:20 aksfjh wrote:Show nested quote +On July 19 2013 01:52 JonnyBNoHo wrote:On July 19 2013 01:39 aksfjh wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:On July 18 2013 11:27 {CC}StealthBlue wrote:The Obama administration and Congress are not helping students, Sen. Elizabeth Warren (D-Mass.) charged Wednesday, reaping record profits off the federal student loan program that a regulator said has finally surpassed $1 trillion in overall debt.
The federal government is due to book $51 billion in profit this year off new and existing federal student loans, according to estimates by the nonpartisan Congressional Budget Office. The record amount brings the government’s profit haul to nearly $120 billion over the past five years, according to CBO forecasts and Department of Education budget documents. The CBO estimates that the government will generate $184 billion in profit for new loans made this fiscal year through 2023.
“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”
“The government should not be making profits off the backs of our students," she said. "Period.”
Shortly after mentioning the $51 billion figure, Warren encouraged the audience of college students and young political activists to express their disapproval.
“We can hear some booing at this point,” she said, eliciting a round of boos presumably meant for the federal government. “There we go,” she added. Source Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! We're talking about net here. Even in taxes, the ideal situation is that they take in slightly less than is needed for services. Surpluses are (questionably) just as bad as bloated government, where you're taking resources/potential away from the private sector, thus "wasting" it. It would depend on what happens to that surplus. On July 19 2013 01:32 JonnyBNoHo wrote:On July 19 2013 01:26 Klondikebar wrote:On July 19 2013 01:21 JonnyBNoHo wrote:On July 19 2013 01:04 Klondikebar wrote:On July 19 2013 00:59 JonnyBNoHo wrote:On July 18 2013 20:48 aksfjh wrote:On July 18 2013 11:33 JonnyBNoHo wrote:
[quote]
Should the government also not turn a profit on tax collection? In a perfect world, it would be almost balanced, with only a tiny bit of actual loss. In reality, I just think they shouldn't make AS much since student loan debt is more-or-less guaranteed due to bankruptcy laws. On July 18 2013 21:13 KwarK wrote:
The two principles underlying usury are that the money being loaned has value and therefore that loaning has an opportunity cost and that there is a risk of default requiring interest payments to balance it. A government loan created from money written into existence and guaranteed by law to be repaid has neither of these. To KwarK - money used for student loans has just as much of an opportunity cost as any other government spending. People can default on their student loans too, it's harder than other loans, but you can still default ( source). To both - why is it so bad for the government to collect money from a loan but not from taxes? Either way it's money out of your pocket! The ideal way to finance a government is almost entirely by debt. But this requires an economy that grows...a lot. The government collects only enough taxes to pay the interest, and then the economy simply outgrows the debt burden. The idea of "profit" in an institution that is both supposed to not be concerned with it and has a monopoly on the use of force worries me. Financing just with debt would also require a very high interest rate in order to induce that much saving. You'd also have to worry about crowding out all other private borrowing. But that is neither here nor there. If you don't like the government turning a profit on an activity - why let it collect taxes? That has to be the highest margin activity ever! Right, a phenomenal economy tends to have a fairly high savings rate because consumption desires are easily met with phenomenal incomes. Again, I'm talking about the absolute best possible scenario here. Steps toward that scenario aren't a bad thing. And why is collecting taxes inherently profitable? Profits are revenues that exceed expenses. The government shouldn't be exceeding its expenses. When it undertakes a project or program, it ought to collect enough money to equal expenses and no more. If taxes are a profitable revenue stream then that means someone is lining their pockets with money collected by force, that sounds like corruption. I'm using the same methodology as saying student loans are profitable. The IRS costs way less than the taxes it collects. So it's profitable. Student loans cost less than the revenue they generate, so they are profitable. But both sources of revenue are used to fund the general government. Government could not exist otherwise. Unless you're advocating a regressive tax system, you're going to be hard pressed to justify why student loans (that are based on income) should provide net profit to the government. Degree holders typically have more earning power than those without degrees. Those who receive subsidized loans are receiving an implicit government benefit. Even if the government is turning a profit it's still a progressive system. You're taking an awfully big leap there. There are many people that obtain degrees that do not make more (due to the degree or choosing for a more benevolent career path). Even in the best case of earnings, we come across your red flag, "double taxation." They're already paying a higher rate in income tax because of that degree, why must they pay more?
They aren't paying more, they're paying less. Paying more would be the government charging more than the private rate. Subsidized student loans are a net benefit to the student.
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On July 19 2013 01:19 Shiori wrote:
Post-secondary education (be it college, community college, or vocational training) should be just subsidized, wholly or partially, for the same reasons that public education is subsidized. Education is, simply, the cornerstone of a responsible and competent citizenry. There is absolutely no reason not to make it as accessible as possible. Obviously, if this were done, one would have to substantially tighten the restrictions on entrance to various post-secondary institutions, in order to prevent people with no aptitude/ability wasting resources i.e. we don't need people going into English literature if they can't piece together a sentence, and nor do we need someone with poor fine motor skills training to be a surgeon or fine woodworker.
I was just talking with Sam!zdat about this very thing. Heavily subsidize higher ed, add a year after high school before entrance, and strengthen admissions standards significantly. This sounds like a good idea to me.
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On July 19 2013 02:40 farvacola wrote:Show nested quote +On July 19 2013 01:19 Shiori wrote:
Post-secondary education (be it college, community college, or vocational training) should be just subsidized, wholly or partially, for the same reasons that public education is subsidized. Education is, simply, the cornerstone of a responsible and competent citizenry. There is absolutely no reason not to make it as accessible as possible. Obviously, if this were done, one would have to substantially tighten the restrictions on entrance to various post-secondary institutions, in order to prevent people with no aptitude/ability wasting resources i.e. we don't need people going into English literature if they can't piece together a sentence, and nor do we need someone with poor fine motor skills training to be a surgeon or fine woodworker. I was just talking with Sam!zdat about this very thing. Heavily subsidize higher ed, add a year after high school before entrance, and strengthen admissions standards significantly. This sounds like a good idea to me.
I agree with this completely, particularly because there is ample evidence that high school students simply don't know enough for university and neither are they particularly mature, hence the huge issues with maladjustment.
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On July 19 2013 02:40 farvacola wrote:Show nested quote +On July 19 2013 01:19 Shiori wrote:
Post-secondary education (be it college, community college, or vocational training) should be just subsidized, wholly or partially, for the same reasons that public education is subsidized. Education is, simply, the cornerstone of a responsible and competent citizenry. There is absolutely no reason not to make it as accessible as possible. Obviously, if this were done, one would have to substantially tighten the restrictions on entrance to various post-secondary institutions, in order to prevent people with no aptitude/ability wasting resources i.e. we don't need people going into English literature if they can't piece together a sentence, and nor do we need someone with poor fine motor skills training to be a surgeon or fine woodworker. I was just talking with Sam!zdat about this very thing. Heavily subsidize higher ed, add a year after high school before entrance, and strengthen admissions standards significantly. This sounds like a good idea to me.
You'd have to have price controls on education then. Right now education is heavily subsidized. But education providers simply raise prices to capture the subsidies instead of letting them stay with the students.
School costs $1000. The government gives little Suzy $400 to help with school. The school is now charging $1400. I realize a lot of people wouldn't have an issue with price controls on education, but I really really do. Telling a private institution what they're allowed to charge is no bueno. And doing away with all private education is dangerous for the development and spread of non-government approved ideas.
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On July 19 2013 01:19 Shiori wrote:
Post-secondary education (be it college, community college, or vocational training) should be just subsidized, wholly or partially, for the same reasons that public education is subsidized. Education is, simply, the cornerstone of a responsible and competent citizenry. There is absolutely no reason not to make it as accessible as possible. Obviously, if this were done, one would have to substantially tighten the restrictions on entrance to various post-secondary institutions, in order to prevent people with no aptitude/ability wasting resources i.e. we don't need people going into English literature if they can't piece together a sentence, and nor do we need someone with poor fine motor skills training to be a surgeon or fine woodworker.
Only true because or primary and secondary education systems are so inefficient and dont teach any appreciable skills.
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On July 19 2013 02:44 Klondikebar wrote:Show nested quote +On July 19 2013 02:40 farvacola wrote:On July 19 2013 01:19 Shiori wrote:
Post-secondary education (be it college, community college, or vocational training) should be just subsidized, wholly or partially, for the same reasons that public education is subsidized. Education is, simply, the cornerstone of a responsible and competent citizenry. There is absolutely no reason not to make it as accessible as possible. Obviously, if this were done, one would have to substantially tighten the restrictions on entrance to various post-secondary institutions, in order to prevent people with no aptitude/ability wasting resources i.e. we don't need people going into English literature if they can't piece together a sentence, and nor do we need someone with poor fine motor skills training to be a surgeon or fine woodworker. I was just talking with Sam!zdat about this very thing. Heavily subsidize higher ed, add a year after high school before entrance, and strengthen admissions standards significantly. This sounds like a good idea to me. You'd have to have price controls on education then. Right now education is heavily subsidized. But education providers simply raise prices to capture the subsidies instead of letting them stay with the students. School costs $1000. The government gives little Suzy $400 to help with school. The school is now charging $1400. I realize a lot of people wouldn't have an issue with price controls on education, but I really really do. Telling a private institution what they're allowed to charge is no bueno. And doing away with all private education is dangerous for the development and spread of non-government approved ideas.
Presumably the subsidies would only be for state universities in the first place. Of course, this would probably cause a big shift away from private universities, and require that we build new ones (and probably result in the closure of a bunch of private schools), but that's not necessarily a bad thing.
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On July 19 2013 02:45 cLutZ wrote:Show nested quote +On July 19 2013 01:19 Shiori wrote:
Post-secondary education (be it college, community college, or vocational training) should be just subsidized, wholly or partially, for the same reasons that public education is subsidized. Education is, simply, the cornerstone of a responsible and competent citizenry. There is absolutely no reason not to make it as accessible as possible. Obviously, if this were done, one would have to substantially tighten the restrictions on entrance to various post-secondary institutions, in order to prevent people with no aptitude/ability wasting resources i.e. we don't need people going into English literature if they can't piece together a sentence, and nor do we need someone with poor fine motor skills training to be a surgeon or fine woodworker. Only true because or primary and secondary education systems are so inefficient and dont teach any appreciable skills.
The teach obedience, repetition, and response to a bell. Highschool was originally designed with the assumption that you'd go work in a factory.
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EPT
