The U.S. student load system is broken. Borrowers currently owe more than $1.5 trillion, an average of $34,000 per borrower. Over two million of them have defaulted on their loans in just the past six years, and the number grows by 1,400 a day. The federal government now acknowledges that taxpayers stand to lose $31.5 billion on the program over the next decade. Source: Wall Street Journal, June 8, 2019
More evidence that this is another government well-intended program that had unintended consequences:
* Four of 10 recent college graduates are in jobs that do not require college degrees;
* more than a third drop out;
* less than half earn a credential within eight years;
* college tuition has soared 1,375% since 1978, more than four times the rate of overall inflation;
* the U.S. spends more on higher education per capita (about $30,000 a student) than any other developed country except Luxembourg. Meanwhile, college presidents are being handsomely rewarded with at least 70 earning more than $1 million a year;
* Delinquencies continue to climb even as the unemployment rate falls below 4%.
This mess was engineered by President Lyndon Johnson under the 1965 HIgher Education Act, which guarantees student loans made by banks. The banks pick up the interest on that loans that are repaid, the taxpayers pick up the tab on the loans not repaid.
Now the political Left is calling for free college education, and some candidates are calling for forgiveness of student debt.
This is only one issue that illustrates the need for owning gold and silver. There is no way out of the problems facing the United States except for the printing of money, which eventually will become worthless.
The Fed will not put our economy through a recession during which malinvestments will be liquidated and the proceeds transferred to sustainable enterprises. Instead, the Fed is going to lower interest rates and kick the can down the road – and hope for a miracle, which I predict will not come. (It is more likely that a war is in the future to divert the people’s attention from economic matters, but not a miracle.)
Maybe the dollar will not become worthless in my lifetime; but, still, it could. It has happened many times in other countries, some multiple times. It will happen here, you just can’t say definitely when.