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Depending on your personal situation, I’ve got good news and bad news for you:  A judge in New York has ruled that student loans are dischargeable through bankruptcy.

A little history lesson first.

During his unfortunate term in office, President Barack Hussein Obama decided the government should take over issuing student loans from the private banking industry.  Literally anyone with a pulse could then get a student loan in almost any amount to attend college, regardless of the students’ (in)ability to pay the loan back.  The direct result of this socialist wet dream was that college tuition increased dramatically almost overnight and colleges started paying presidents and professors more than they ever dreamed possible.  The promise from Obama was that only a college education could anchor the highest paying jobs (which is a fat lie) so therefore the student borrowers will have more than ample income to pay off their student loans.  That didn’t work out as promised by Obama, (shockingly) whose liberal policies ran our economy into the ground and resulted in unemployment numbers so high that even the college educated job seekers couldn’t find a decent career.  Obviously, the student loans began defaulting dramatically, but until this ruling, we were all assured those student loans could never be discharged in a bankruptcy, so the students would have to pay them back in full with interest.

Why did I write, “we were all assured”?  It is because our government was loaning these students our tax money instead of loans from a private bank, which means we taxpayers are all now on the hook to pay off all those discharged student loans.  Right now, the student loan debt is over $1.6 trillion dollars!

The good news is that our government will probably end its adventurism into making student loans and let it revert back to the private bank sector.  But private banks won’t be so freely giving out those loans like our government did, so it will be harder for students to qualify for them — and that means college tuitions will eventually come down to reasonable levels.

This whole student loan crisis mirrors the housing bubble that burst in 2008, where people were getting huge mortgages on homes without having to prove income.  One would think Obama might have learned his lesson from the mortgage crisis before he got us into the student loan crisis, but Liberals are apparently incapable of learning from their own mistakes, let alone admit to them.  Our government bailed out the banks with our tax dollars, but they cannot bail out themselves, so you can bet we will all be on the hook for yet another Liberal/Obama catastrophe, right along with the losses associated with ObamaCare.

If this ruling holds, just about all that $1.6 trillion dollar student loan debt is going to be discharged through a massive increase in personal bankruptcies.  The partial good news is that those who discharge their debts will be able to buy homes after their bankruptcy falls of the books in about ten years, but during those ten years, we’ll be on the hook for all those loans, so the, “recovery”, is going to be slow.  But when housing sales do soar after ten years (mark it on your calendar) our overall economy will burst its seams because people who buy homes will buy all kinds of other home related items for them, thus the consumer segment of our economy, which is currently 70% of GDP, will expand dramatically.

We already have a growing $23 trillion dollar debt, so another $1.6 trillion will be added to it, and if interest rates rise in the future, they could rise to the point we can’t even pay the interest on that debt, which means the United States of America will find itself in a state of default — and we will all find ourselves in a state of economic ruin.

I don’t have a clue whether future federal court rulings will uphold this NY judge’s ruling, so perhaps I’ve written all this for nothing.  But on balance, if it is upheld, we’re all eventually screwed, including those whose debts were discharged.

That’s yet another reason why Socialism never works.

Carl F. Worden

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