In this commentary, I will address the Federal Student Loan program. For full disclosure purposes, I am paid as Campaign Manager for Wayne Johnson for Congress. The opinions I share on DonCole.com are mine and I am not being paid to write this article.
Student loans were in the news when the Covid suspension of payments was about to end this month. President Biden kicked the can down the road until May, thus postponing another political disaster within his administration when millions would have to begin making payments again.
So let me tell you about the dirty little secret of the Federal Student Loan program. Every day, millions go out the door of the US Treasury to colleges and universities as “Financial Aid” in the form of loans to get students in schools that will indoctrinate them into the anti-American woke ideology and culture. Many of those loans will never be repaid – and everyone involved knows that they will never be repaid.
Candidate for the 2nd District of the US House of Representatives, Wayne Johnson, wants to Stop the Stupid. Without apology, he wants to kill the wasteful, dare I say, fraudulent program.
In the beginning, student loans were provided through local banks. The bank made an evaluation of the credit worthiness of the borrower and the federal government guaranteed the loan. The default rate on these loans was low.
President Obama saw this as a cash cow to help fund Obamacare and he hi-jacked the program from local banks to help pay for his pet program. You can guess what happens next.
Determining credit worthiness went out the window. The more money the federal government could loan (give-away) the better.
The loan is lumped into the student Financial Aid package. In some cases students do not even realize they are borrowing money. That news comes after they graduate or quit school.
In 2017, Wayne Johnson joined President Trump’s administration as the number 3 person with the Department of Education. His job was to manage the $1,400,000,000,000 (that’s $1.4 TRILLION DOLLAR) portfolio of Student Loans.
Wayne quickly learned that the program was fraught with serious ethical predatory lending issues. He went as far as to say that in its current form, it perpetuates a fraud on the American taxpayer and the student borrower as well.
Wayne evaluated the portfolio. He determined that a fair market value of the loan portfolio was pennies on the dollar.
Wayne learned that a shocking 85% of the loans would never be collected – yet the loans were shown as assets on the government’s balance sheet.
His findings were confirmed again this month. On January 13, Navient bank agreed to settle with 39 states to pay off $1.7 billion in student loans.
Among other activities the bank knowingly steered students into long term forbearance loan programs where a minimum payment was less than interest. The loan balance continues to climb to an unbearable point.
Pull off the facade of a government program and you have a loan shark. What the federal government is doing and allowing is simply unethical.
Wayne set out to Stop the Stupid. His plan is simple.
1. Kill the current Federal Student Loan Program. When you’ve dug yourself into a hole, stop digging. This step is critical and if the program is not killed, then the ball stops right here.
2. After the program is killed, show fairness to those who paid while acknowledging the reality of the vast bad debt.
a. Tax credit for those who paid for student loans or paid their own way through private means. It is punishment to those who paid responsibly when you write off debt of those who did not. The current Federal Loan program is a defacto grant for higher education so treat it that way for everyone.
b. Do what every banker does with bad debt. Acknowledge it, write it off, and stop showing it as an asset.
Now, you may wonder why I am writing this article. It is simple – politics will twist, spin, and characterize this plan as cancelling student loans for the deadbeats. Some media outlets already lump Wayne Johnson in with Bernie Sanders, Elizabeth Warren, and all the other left wing radicals in Congress on this issue.
I can see the slick supersized postcard arriving in mailboxes across the 2nd District: “Wayne Johnson wants to cancel Stacey Abrams’ student loan with your tax dollars.”
That is exactly what the Democrats want to see happen. They want to see Republicans ignore the tsunami of their tax money going out the door every day naively believing they are going to real loans to credit worthy college students.
The truth is that the money is often used for tattoos, parties, vacations, and numerous other avenues of squandering your tax dollars. What this program is doing is stupid and Wayne will stop it.
Wayne knew the risk of spin when he tackled this problem. He knew that he would be lumped in with Bernie Sanders.
His approach is as far from Bernie Sanders as Donald Trump is from Joe Biden. His boldness to tackle the issue is a big reason that I agreed to give him my full support.
Many elected officials choose to respond to complex issues with hand-wringing and hiding from the issues. I am weary of politicians who hold their finger to the wind and refuse to hit the tough issues head on.
I am sick of hand-wringing and hiding. We need a hard worker, not a hand-wringer. When Wayne says he is out to Stop the Stupid, he means it.
While he is zeroed in on the Student Loan Program, his big target is to abolish the Department of Education. Every candidate talks about that, but Wayne is doggedly determined enough to work with Republican leadership to maybe get this through the House of Representatives.
I encourage you to watch his interview with Tucker Carlson on the Student Loan program.
If you vote in the 2nd Congressional District, I ask you to support Wayne Johnson for Congress. We have too many hand-wringers in Congress. Wayne is a hard worker.
You can learn more about Wayne and contribute to his campaign by going to www.johnsoncongress.com
Thank you for taking the time to read. May God bless you.
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Sign up to receive Common Sense from DC (Not Washington). I won’t waste your time or flood your inbox with junk or pleas for money. You’ll get my thoughts and commentary on various issues and stories about people, politics, and proclamation. You can unsubscribe easily at any time. I appreciate you as a reader and will strive to make it worth your while.
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