"Take the student loan industry, for example. Since 1994, the cost of attending college has skyrocketed, to where the average student can expect to graduate with over $18,000 in debt for a four year degree.
Sallie Mae, the largest provider of student loans, and former Government Sponsored Entity has seen its stock price rise by nearly 2000% during the same period. Its executives have paid themselves billions in stock bonuses. Its Chairman recently attempted to purchase a major league baseball team. Its CEO again topped the list of highest paid CEO's in Washington D.C.
Many don't realize that Sallie Mae lobbied for- and got- draconian legislation passed during the same time period. This legislation took away bankruptcy protection for all student loans- federally guaranteed or not. This legislation made it illegal for most borrowers to refinance their consolidated debt, even with lenders willing to accept less profit. This legislation gave the lenders collection powers that would 'make a mobster envious', to quote Harvard professor Elizabeth Warren. These powers include termination of public employment, income tax seizure, wage garnishment, suspension of professional licenses and certificates, and seizure of social security, and disability payments. This legislation has actually made it more profitable for lenders when students default, as opposed to remaining in good stead with their loans."
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