Student loan forgiveness is being taken seriously right now by the bourgeoisie.
The Federal interest rate going near 0% has led to a massive boom in housing construction. Student loan deferment has led to many people saving up for a down payment on a house. The housing market is carrying the US economy right now.
If student loan deferment ends, this space that Capital found for expansion will disappear. There will be an immediate crisis.
Also, the effort to privatize student loans has been a failure. Betsy DeVos has been the Secretary of Education most dedicated to privatization. She killed the Perkins Loan, which has led many new students to private loans.
Although, after her reign, 92% of public student loan debt are still held by the Department of Education. It is unlikely that the Biden SoE will be more successful at speeding up the process. Capital is in crisis now.
Forgiving public debts is a method of privatization in America, where a culture of indebtedness exists. They want everyone with public student loans to take out private mortgages, owned by JPMorgan, Citigroup, etc.
I'm not saying student loan forgiveness is good or bad. It is good for me. But it serves a purpose that we should understand.
They're fucking idiots if they don't do it honestly. Not only would it transfer large portions of young peoples income to private banks, but home ownership Is the easiest way to give workers a stake in Capitalism. Two of millennials' top issues are student loan debt and their inability to buy homes, and we have seen a big uptick in anticapitalist sentiment among them largely due to these two issues.
Their hesitation is because student loans discipline labor.
The threat of student loans is the major reason I can't rock the boat at my job.
And this is the real reason to tie health care to jobs, and not just jobs, but full-time "real" jobs.
100%
Teachers went on strike in my city last Wednesday. The School Board revoked their health care Tuesday night.
There was massive community support for the teachers, and the Board capitulated to their demands in a day. But still, it clearly illustrated the role of employer-based health insurance to people here.
Anyone that yanks health care during a pandemic earns a date with the business end of a crowbar
Followed by an "I'm sorry, we don't take patients with pre-existing crowbar wounds. That'll be $300,000."
It became a huge scandal that hasn't let up yet (thankfully). The Board is trying to save-face right now, but people are pissed.
They will probably get voted out next year. They deserve much worse lol
I think you and I live in the same Rust Belt inner ring suburb
And retirement via 401k / roth IRA / whatever the fuck people are doing. Tying literally your entire life to your job, every SINGLE aspect of it, is crucial towards maintaining a docile and servile labor force.
This, plus the runaway engine of punishment. The individual actors in America arent thinking about "how can we keep capitalism going" but they do often think "young people deserve to be buried in debt."
Great point. The reserve supply of labor is high. Back when unemployment was around 3%, they needed other tools of labor discipline (student loans). They are less needed now, so the bourgeoisie are more willing to consider student loan forgiveness.
This is true, but as someone pointed out, unemployment can serve this function, as well as the threat of underemployment via the gig economy. Mortgages are another way to discipline labor, and it's one that private banks can profit off of more directly than student loans. Once you own a home, you will run yourself ragged to hold onto it.
I honestly have no idea what is going to happen wrt student debt. I think it's one of the only concessions neoliberals might dole out exactly for the reasons laid out in this thread. But at the same time I'm not sure of it, because they get some kind of sick pleasure out of the misery they inflict on the working class. I guess we will just have to see.
I was just about to respond to that post:
Great point. The reserve supply of labor is high. Back when unemployment was around 3%, they needed other tools of labor discipline (student loans). They are less needed now, so the bourgeoisie are more willing to consider student loan forgiveness.
They need people to buy their shit. There is an over-production of houses right now.
I don't have sources on hand. This is stuff I've absorbed from following the housing news for a few months. I'll see if I can find a good source.
I think we on the left have a tendency to underestimate how scared of us the Bourgeoisie really is. We had massive violent uprisings all over the country this summer, uniting working class people of all races in opposition to the Bourgeoisie's tool of enforcement. Police precincts being burned down, people shooting each other, and long term sustained and even organized clashes with the police in Portland. Sure, they didn't win anything but still that scares the shit out of the porkies. Even though there was bombings and shit in the 60s we didn't have thousands of young folks, particularly young white folks gearing up in armor and gas masks, forming street phalanxes and pushing the police back for literally months. The hippies definitely were out in the streets but their ideology was inherently nonviolent. Young leftists today believe violence is a useful tool and are clearly willing to use it.
Also, while China is obviously not the USSR, they are a serious threat to US hegemony. They would much rather focus on countering China without worrying about domestic unrest. They understand that external conflict plus domestic unrest is a recipe for disaster. They are doing well with the anti-China propaganda but in the age of the internet its going to be hard to control the flow of info from east to west. Eventually people will start wondering where the mass Uyghur graves are, and start to question the narrative. And even if they don't, it's basically impossible to conceal the fact that China is doing better and better while we are doing worse and worse.
True I guess that wasn't entirely accurate, just that we didn't achieve our main demand.
I think it was a pretty big victory for the Proletariat in general to show that there can be broad based cross-racial solidarity in a militant movement. If I had to guess, the Bourgeoisie will attempt to chip away at that solidarity over the next few years because it scares the shit out of them.
If I had to guess, the Bourgeoisie will attempt to chip away at that solidarity over the next few years because it scares the shit out of them
Heightening the divide between college educated and non-college educated workers seems to be a strategy they are considering.
My friends from high school and I have materially been in a similar spot. I make more, but I have a shit ton of student loan debt. If my debt is forgiven, that would change. I would be able to buy a house, I could invest in the stock market, etc. My material conditions would look similar to white Boomers. My material interests would align more with Capital.
Yeah for sure. I don't have a degree because I'm a dropout but I do have debt, especially debt I've ignored for years. If that disappears, especially if they wipe it from your credit score, I could actually buy a house and a car. I wouldn't look like a suburban boomer but I'd probably look similar to gen x, able to drive a 5 year old toyota and live in a 3br townhouse etc.
I think they will also try to separate black and white workers. Student loan forgiveness would likely help white folks more than black folks already, but they also have control over cultural hegemony. Idk what it will look like but I think they will try to drive a cultural wedge like they always have.
Student loan forgiveness would likely help white folks more than black folks already, but they also have control over cultural hegemony.
It will. In order to qualify for big student loans, parents need to cosign, and they check your parents income. I think student debt holders are more black, but mortgage-sized student debt holders are more white.
Idk what it will look like but I think they will try to drive a cultural wedge like they always have
I think Trump's brand of politics, anti-New World Order stuff, will continue to be a big wedge. I think that aligns with the college educated divide pretty well. The only people I know who take MSM seriously have a degree lol
I think Trump’s brand of politics, anti-New World Order stuff, will continue to be a big wedge. I think that aligns with the college educated divide pretty well.
If they can manage to make that stuff seem less racist, the GOP really would become the party of non-college educated workers. Trump made inroads with black and Hispanic voters even while ramping up the racism, if they dialed it back they could probably capture a majority of nonwhites. They don't seem to be doing that though.
I'm not trying to diminish BLM's wins I'm just saying they didnt do broad systemic reform to the institution of policing. They've given concessions, and that is absolutely great. Direct action works.
Louisville had a huge uprising and one officer got fired and no knock warrants were banned. I know that it is technically something but I really would have liked a victory that didn't feel like a spit in the face.
It doesn't matter how much wealth or power or cops they have if the majority of the proletariat turns against them. Automation requires engineers and mechanics, police forces require food, supplies, ammunition, etc. You can't maintain a power structure if a massive portion of the overall population doesn't want it to exist and is willing to tear it down themselves.
Capital can only continue to survive if it keeps a fair chunk of the population invested in capitalism. If the entirety of Gen Z and Millennials decided they wanted socialism tomorrow morning, they're up shit creek without a paddle.
If people cannot buy homes the housing market will collapse again. The immediate need is less about maintaining any self-conscious allegiance to capitalism and more about saving a specific market.
Can't say I fully agree with you. The European comparison is important, and I think the market would be fine with a switch to a more rent-focused model, but that change would need to be slow. That sort of change has to be a long term, intended change, in the same way that housing market was quite consciously shifted to focus on home-ownership as the suburbs were built post WWII. It's similar to the crisis we had in 2008, I think. A lot of homes with people who can't really afford them and a housing/financial market built around mortgages.
Y'all at giving capital too much credit. All of that is true and they will still cut off their nose to spite their face.
Like letting people pay rent with Credit Cards. That is going crater the whole fucking thing
https://www.npr.org/2020/11/30/938867270/more-americans-pay-rent-on-credit-cards-as-lawmakers-fail-to-pass-relief-bill
Real and bout to be a massive problem.
yeah lmao
my apartment complex is offering a """special""" deal during the pandemic where they dont charge you the extra 3% fee they usually charge you if you do it. wow thanks not leeching even more money off me than you already do if i end up in a situation where i have to do something as risky as putting rent onto a credit card, what a generous deal
Yeah, they'd sooner allow landlords to claim renters late on rent as indentured servants.
I'm not holding my breath but Biden is filling his cabinet with diehard ideological neoliberals that exist to serve the interests of finance capital. Student debt forgiveness makes sense from a neoliberal perspective in the same way that corporate bailouts or the ACA does. It puts money into the hands of capitalists, more specifically finance capitalists. Who knows though. The right, which is increasingly representing industrial capital over finance capital, might browbeat them into giving up. We know how Dems love giving up.
These are very different scenarios though. Student payments are money being extracted from the economy and getting funneled to the DOE, whereas in 2008, it was money that was flowing to finance capital that was interrupted. Also the bailouts were a lump sum to restore liquidity. We are talking about eliminating the extraction of a large amount of money from the economy, much of which will go to servicing new long term loans from private banks (hypothetically). A mortgage is most likely multiple times the amount that student loans are and having millions of new mortgages could increase the overall hold finance capital has over the greater economy. On the individual level it's the difference between being on unemployment until work picks back up vs getting a permanent salary bump.
Student debt forgiveness makes sense from a neoliberal perspective
Ever seen it discussed in the Neoliberal sub? Consensus says they'd sooner eat their own fingers than see anybody's student debt relieved.
Joke's on them, forgiving my student loans would give me enough money to buy 2 shipping containers and a small plot of unincorporated land in Maine or Montana. See ya later housing market, I'm gonna go be starving and homeless before you can even touch me.
Shipping containers make awful shelters - particularly in areas with brutal temperatures. You'd be better off using local materials, or even tents.
Bring an arc welder so we can cut doors and windows into them. Also maybe some barrels to catch rain water.
All reform is an attempt to stave off collapse or revolt, so this isn't really anything special. And it would help a lot of people, so I hope they do it. I'd save the equivalent of a full year's salary.
Jokes on them when I just build a killer overlander rig and live the van-life! Van-guard-life!
I imagine if you bought a plot of land and then parked on it. Otherwise, I can't imagine you pay tax on anything other than the vehicle itself -- which for my tastes would be a Class B RV-type truck -- or the taxes on tertiary costs that come with living that lifestyle like, parking in an RV area, gas, national park permits, etc.
It's good. Even if the money ends up in private instead of public debts, at least millennials will have some actual fucking money.
For now. Then we spend what ever we scratched together on bluth homes that fall apart in 3 years
a mortgage is almost the same amount where I live. They only benefit is having your own space, but upkeep is a hidden cost to home ownership.
Well it's more like one third of your rent goes to owning your landlord's apartment, and you can sell your landlord's apartment and get some money back. Its like almost the only reason people have money today
It is good for people who recognize the game, and act accordingly.
People who get sucked into this next bubble will end up worse than people with student loans.
Student loans are publicly owned (can be forgiven) and have no collateral. Mortgages are privately owned. They will never be forgiven. And the repo man will take everything you own if you can't make payments.
The pigs would never let that happen today. They'd photograph everyone, track them down individually and arrest then all at work.
If the repo wants my 10 dollar set of cutlery, 1 pan, pillow, and the 3 posters I have on my wall, he can take em. Anything important to me is getting buried in the woods.
My sister has shit credit, and just got approved for a $280,000 loan with $5,000 down. It is a land grant, where she is selling part of the property to cover the debt, but still...
There is an absurd bubble right now due to low interest rates and banks desperate to a avoid collapse.
It feels like we are speed-running 2001-2008 in an attempt to prevent a COVID financial crisis lol
I used the crash to destroy the crash
~ some purple capitalist somewhere
Because owning a home will change your outlook on life and the way you vote. Like in Portland homeowners were removing port-a-pottys that were installed for the homeless population because they were worried about how it would affect their neighborhood. Renters wouldn't be such psychopaths
If you cannot fill the rental, you are fucked.
The widespread delinquency with rents right now have made rental investments risky. If you are delinquent with rents, you get evicted. If you are delinquent with a loan, your assets get seized.
There is a reason rent prices are crashing in major cities, and housing prices are booming.
Real Australian economy hours, who up?
but on a much larger and more fucked scale
I cover real estate for a decent-sized business publication- this is definitely true from my experience covering it. The NAR and other pretty mainstream real estate orgs have hinted as much, though of course the won't go so far as to actually advocate for the loans to be forgiven.
Do you got any recommended sources for the housing market?
My post is mostly from intuition and personal anecdotes. I want to flesh this out more, with actual housing market data.
the best two places for a left take on the economy in general IMO is Naked Capitalism and Wolf Street.
With the Great Reset, home ownership will be a thing of the past, right? Who's to say they want people to be home owners?
It is a real idea that the World Economoc Forum has been pushing. The WEF has also been predicting that China will be absorbed into western capitalist hegemony for two decades lol, they do not control the world.
They are just bourgeois utopians, and the Great Reset is their idea for the world. The bourgeoisie are the ruling class, so the Great Reset will be influential, but there are other factors involved.
The reality is that selling houses is profitable. It is one of the few places to profit right now, so house ownership rate will probably rise.
The Great Reset is bourgeois utopianism.
The reality is that selling houses is profitable. It is one of the few places to profit right now.
It's more profitable (for now) to build it, own it, write off it's depreciation as a tax write off, and rent it out for more than it's worth.
That's great if people are looking to rent. The supply of renters is shrinking because mortgages are incredibly easy to get right now.
Yeah but you have to have some sort of income to be able to get a house. The only people I've noticed buying homes are the rich (buying a bunch to rent out) and the well-off (buying their own home). Most people can't afford or have proof of income even with easy access to loans.
Edit: and "looking to rent" is most people. I think the era of American homeownership is mostly over were on the road to becoming a nation of renters so it's either rent or be homeless.
That is much different than my experiences. I've been hearing so many stories of schoolmates and family members using their student loan deferral money to buy a house. Banks are offering loans with 2-3% down payment. If you can save up $3,000, you can get a loan for a decent house in my neighborhood.
“looking to rent” is most people.
No it is not. The majority of Americans are home-owners, and the rate of rental has crashed this year. For example, rent prices in San Francisco are down a ton this year.
According to Realtor.com, the average price for a studio apartment in San Francisco has gone down 31% compared to last September. [1]
Also, a personal anecdote from the Midwest: my landlord has been unable to fill the downstairs apartment since the pandemic started. Our lease is coming up, and we are going to demand a 25% reduction. We will probably get it.
Our lease is coming up, and we are going to demand a 25% reduction. We will probably get it.
Our landlord wouldn't drop our rent $40 to keep us on the west coast.
Homeownership was down to 65%, since wages aren't going to increase there's no way Zoomers, mellinials, and gen x are going to able to afford their boomers parents/grandparents houses. Esp after people won't be able to afford the loans and get their homes repossessed. If things keep staying the same while getting slightly worse homeownership will drop well below 50% within the next few decades.
Also just cus rent has gone down temporarily doesn't mean it'll happen forever. Rents have gone down because PMC types have fled the city till things reopen and people who worked in the service industry lost their jobs and then their places of residence. Once PMC types flood back into cities when bars, restaurants, etc reopen rents will start going back up or flattening out.
This an embarrassing thing to have to ask but what do you mean by PMC in this context? The only "PMC" I know is a Private Military Contractor.
Our landlord wouldn’t drop our rent $40 to keep us on the west coast.
That sucks. Our landlord clearly read some Barron's article which said renovating a house would yield profit in a pandemic. Turns out, no one is renting. It seems like he just wants to stop hemorrhaging money. If we leave, he is fucked.
Homeownership was down to 65%, since wages aren’t going to increase there’s no way Zoomers, mellinials, and gen x are going to able to afford their boomers parents/grandparents houses
30-40% of millennials have student loan debt. Now that student loans are in forbearance (and banks dropped their down payment expectations), they are able to afford the $2,000-$5,000 down payment for a house. If student loans are forgiving, there will be a bigger boom.
PMC types have fled the city till things reopen and people who worked in the service industry lost their jobs and then their places of residence.
Most of those service industry jobs are not coming back. The PMC types are all buying houses in the suburbs. They won't be moving back to cities. Half of restaurants will not be able to reopen, and those projections do not account for large-term migration from cities.
We are at the beginning of a second white flight, and student loan forgiveness would help that tremendously.
they are able to afford the $2,000-$5,000 down payment for a house.
Those down payments are offset by higher monthly payments which if people countiue losing jobs and wages don't increase it won't matter if you have a house now because you'll lose it down the line.
Also, if the instrest rates aren't fixed people are going to be crushed when they're raised and it'll be '08 all over again .
If student loans are forgiving,
That's true, but I dont see full loan forgiveness happening any time soon. I know it's being talked about and MAYBE they'll sneak in like 10% forgiveness up to a certain amount of you're up to date on payments into the next stimulus (if there is one). I just don't see any american gov doing anything besides allowing the richest to continue looting what's left of the empire while it falls apart.
Those down payments are offset by higher monthly payments which if people countiue losing jobs and wages don’t increase it won’t matter if you have a house now because you’ll lose it down the line.
Also, if the instrest rates aren’t fixed people are going to be crushed when they’re raised and it’ll be '08 all over again.
I agree entirely. I feel like we're speed-running the last housing bubble. I can see Democrats forgiving student loans to fuel the bubble.
I just don’t see any american gov doing anything besides allowing the richest to continue looting what’s left of the empire while it falls apart.
I agree. I just think student loan forgiveness alongside a housing bubble may be the best source of profit. No one makes money off public student loans. It just pays off the US debt, which no one cares about. If even half those student loans became mortgages, investors would be real happy.
I’m not sure if I would describe this as white flight exactly. I see the rich leaving cities for other cities. Everyone I know leaving the Bay Area is moving to Texas and it has to do with how Trump restructured state tax deductions to hurt blue states. If they are staying in the bay, they are just gentrifying new areas. San Francisco rents might be down, but Oakland is booming in price.
I don't know if bourgeoise are just really bad at understanding how the economy really works or if they just hate the poor that much.
It's the former, mostly. Like, it'd be full-on tinfoil hat level to claim everyone is in on it and just lying to us all and somehow no working-class person has ever heard this, so it seems a lot more likely to me that everyone at the top is actually very, very ignorant of how things work outside of their social sphere of other wealthy people.
Just look at how stock traders talk. "Historically, 6 out of 7 times [specific meaningless calculation that has no bearing on the real world] has given a positive result, the stock market's given double-digit returns over the next three years!! It just happened again!! BUY BUY BUY" "jim we're in a fucking pandemic no one has money and even if they did they cant go outside to spend it, i dont know how you expect history to repeat itself today" "But look, the line's going up again anyway! Economy's doing good!" "thats because you're buying all the stocks because your program tells you to" "Yes! Because it's going to go up! See, it just went up more!"
None of it has any actual bearing on people's material realities, at all - but to people who view their bank account not as "how long I can stay alive if things go tits-up", but rather as their high score, yeah, the entire field of economics suddenly... actually works, instead of being horoscopes for STEMlords.
Honestly I'm lucky enough to be able to pay off my loans in a lump sum due to the deferment. I now need to weigh my options if there's some forgiveness because it would help tremendously to free me from the boot of the landlord.
saved enough to pay them off, was about to pay off, heard whipsers of some far off fairy tail of loan repayment, then thought for a second I might be able to save my money to get a little closer to the impossible 20% down payment and had second thoughts about paying them off at this moment.
