Biden to Forgive $238 Million in Cosmetology School Student Loans

[mahatmakanejeeves]

Source: The Wall Street Journal.

POLITICS

Biden to Forgive $238 Million in Cosmetology School Student Loans

The action provides relief for 28,000 borrowers defrauded by defunct for-profit Marinello Schools of Beauty

By Gabriel T. Rubin
https://twitter.com/Rubinations
Apr. 28, 2022 6:00 am ET

The Education Department said Thursday that it will cancel the loans of 28,000 student borrowers who attended a now-defunct for-profit chain of cosmetology schools, the latest move by the Biden administration to address the politically charged issue of student-debt forgiveness.

Borrowers who attended the Marinello Schools of Beauty between 2009 and its closure in 2016 are eligible for relief, which amounts to $238 million. The federal government previously determined that Marinello had “engaged in pervasive and widespread misconduct that negatively affected all borrowers” enrolled during that period—among other things, that it had “failed to train students in key elements of a cosmetology program, such as how to cut hair.”

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Read more: https://www.wsj.com/articles/biden-to-forgive-238-million-in-cosmetology-school-student-loans-11651140001

[Johnny2X2X]

1. This is great news

Biden is serious about canceling student debt, I don't see a huge action coming, I see him chipping away at it like this and also suspending payments indefinitely.

If the economy is in for a slowdown, keeping the payments suspended will act as a stimulus.

[mahatmakanejeeves]

2. This is what is called a moral hazard.

People took out loans to attend cosmetology college?

Repayment is not being suspended. It's being cancelled.

Who's left holding the bag? Hint: look in the mirror.

[paleotn]

3. For profits are fronts for preditory lenders....

Even seemingly reputable not for profit trade schools and colleges as well. Tons of profit to be made in saddling the unsavvy with debt for an education that costs vastly more than it should.

[Johnny2X2X]

4. So bail out billionaires, but not regular folks?

We've got plenty of money to bail out banks and billionaires, but not hair stylists? No one ever mentions "moral hazard" when an oil company needs a $billion taxpayer funded subsidy. The student loan crisis is real, people like cosmetologists took out loans to get a certificate that would help them earn a living and become productive taxpaying members of society. Millions of other students are totally underwater, investing in them with debt relief is good for the economy and shows that the US values education.

We gave 600 Billionaires a $1.7 Trillion tax cut, who's paying for that, look in the mirror. We can afford to give 40 Million student loan borrowers the same deal the 600 billionaires got.

[mahatmakanejeeves]

6. Why not go after the cosmetology college?

That's who made off like bandits.

Part the deux, the required courses to become a licensed cosmetologist are put in place as a barrier to entry to the job. Who benefits? Not the customer, but existing cosmetologists. With lessened competition, they get to maintain high prices.

There's a lot wrong here, but we can start by getting rid of the nonsensical required courses.

[Johnny2X2X]

8. Wish it were more possible

Those for profit trade schools/on line universities have been protected by Republicans at every turn. The corporations have been dissolved and the people who got all the money are protected by US law.

For profit colleges, payday loans, and sub prime auto loans have been a pet peeve of mine for decades. It's predatory and people don't even realize how bad it is. In the early 90s I worked for ITT one Summer in the job placement office, which was really just me sitting in a cube making phone calls. I shared an office with their recruiters and I cannot describe how ruthless of salespeople they were. I got to hear their phone calls, I was familiar with sales techniques, and these people were using every underhanded and high pressure sales technique you've ever heard of. Just hammering these prospective students and their parents into submission.

They were looking for marginal students whose parents never went to college. So they could guilt them into "wanting to make something of your life." "Don't worry about the money or cost, we'll take care of all of that." Heard them literally call kids who told them no "losers." And then the onsite tours were even more orchestrated and seedy. Getting blue collar folks and their kid on campus and just pressuring and pressuring them until they signed. Just amoral garbage. You'd see the mother and father and know they'd never been on a campus of any kind before, you'd see the kid and see how wide eyed they looked, and you'd know they were easy marks for the sharks the school set upon them.

Oh, and I was tasks with finding interviews for their recent CAD program grads, this was when they just started their CAD program and had their first 110 grads, after a year only 2 had jobs doing CAD and both were making less than $12 an hour and were probably $50K in debt. Engineering firms back then would just send one of their engineers to a CAD class if they needed someone with that skill in the office.

I think about those kids and their parents when I read about stuff like this. How they were broken down mentally and guilted into singing away their financial future. Have a disabled niece who was guilted into cosmetology school with the same tactics, I think her debt was already forgiven because of her disability, but if it wasn't I think she deserves this help.

[jmowreader]

21. As a cosmetology customer I WANT those barriers to entry!

Half the stuff a professional hairdresser uses is completely capable of destroying your scalp in the hands of an untrained person.

[Betty88]

12. +1 for that

[calguy]

11. While I can see the benefit to those who willingly took on their debt...

I see no political benefit whatsoever for Biden and the Democratic party. In fact, he's just written an attack ad for Republicans.

The idea of just saying, "OK, you don't have to pay it back," is very unsettling to a majority of voters.

It's a sucker punch to everyone who did pay their way as well as those who wanted to go to college but didn't choose to go into debt.

It's a personal responsibility issue that the GOP will use against us.

No one forced any of those students to voluntarily take out loans, but the taxpayers are being forced to pick up their tab.

I'm sorry if my opinion offends many DU'ers, but that's just the political reality.

[Joinfortmill]

20. It's about predatory for profit schools. Republicans hands are not clean here.

https://www.businessinsider.com/for-profit-colleges-alleged-fraud-student-loans-debt-cancelation-education-2021-3

And this: https://www.theatlantic.com/education/archive/2017/03/the-closing-of-the-republican-mind-on-for-profit-colleges/520803/

[calguy]

23. I know what it's all about

The fact remains no one held a gun to anyone's head to force them into signing up. I don't see any loan forgiveness for people who got trapped into predatory mortgage loans. Or predatory car loans. And don't even get me started on credit card interest.

The Republicans will frame this as a personal responsibility issue. "Free Stuff" is the catch phrase they use, and it'll hurt us.

I'd rather see a program to refinance the debt at a very low interest rate that covers the cost of administering the program.

The idea of just saying they don't have to pay their bills when everyone pays theirs just isn't a winning issue.

Maybe if they forgive my mortgage loan I'll feel better about it.

[Doremus]

42. Is that what it's all about? Where's mine?

That mantra is a repuke hallmark, or I thought it was, because it only scratches the surface. Intelligent people including us Dems can look deeper than the obvious and see that the for-profit education industry does a disservice to most of us who lack the wealth to make loans at exorbitant interest rates.

For-profit education limits who can attend college by keeping out all but the wealthy and those with available credit. That doesn't speak well to America's future, and we are now in the beginning stages of reaping what we have sown since Reagan.

[Owl]

48. Exactly

[jmowreader]

22. With the proper messaging from us the Republicans can't respond

This is a chain of beauty schools that convinced people to sign up for massive loans to learn how to give haircuts, then didn’t teach them to give haircuts.

If the feds also go after the people running this fraud, we will be fine.

[calguy]

24. We won't be fine

Republicans will frame this as "Free Stuff" and it'll hurt us big time.

[calguy]

37. Fair enough

[Doremus]

43. Let's talk free stuff back to them then.

We've certainly lavished them with nothing but free stuff for many years. Let them go there I say.

[calguy]

46. Already been tried with zero results

[Doremus]

50. Okay, so let's give up and whine.

American oligarchs own all major media. What do you expect them to talk about, how the Dems are the best? Let's get real.

[calguy]

52. My common the subject are nothing more than stating reality

[Achilleaze]

5. "Oh noes." - Beauty School Dropout

"I shoulda hung in there." - BSD

[Joinfortmill]

18. LOL

[JustABozoOnThisBus]

7. Whoever learned how to dye Giuliani's hair deserves a full refund

[Joinfortmill]

17. You mean at cosmetology school?

[oldsoftie]

9. It hasn't been "cancelled" at all; WE will pay for it. Hey, just add it to the debt!

[oldsoftie]

30. Too many people who PAID their loans get screwed.

And too many young people don't THINK before they go into debt for overpriced degrees; among other things. Its time they learn

[oldsoftie]

33. I never had one. Its time people assessed what they're borrowing for.

A lot of these overpriced degrees are of little use in the job market. Go to a technical college. We have tons of well paying technical jobs begging for people. Learn a trade; more high paying jobs. And the bonus is that most of those jobs can't be outsourced. Join the military; they'll send you to college for free.
Some of these loan amounts I see are absolutely ridiculous for what you end up with. Maybe investigate why university costs rise faster in this country than MEDICAL costs. And maybe stop making kids think they can't be successful without a college degree. The majority of the most successful people I know either never went to college or never got a degree.
But you're right; nobody gives a shit about the debt; republican or democrat. Because neither party is willing to do the things it would take to reduce it. "Free" only means someone else has to pay years down the road. And if you have kids or grandkids, its going to be THEM.

[oldsoftie]

35. Well, I've preached for years about over priced degrees. Not angry just realistic.

I've also preached for years about the biggest ripoff in US history has been diamonds!
And what's wrong with cosmetology? The girl who cuts my hair bought her first house at 25 yrs old. She's 38 now and doing very well. You know people today are far more vain than in the past. Don't know how old you are, but when I grew up in the 70s & 80s we had zero nail salons, massage parlors (not the sex kind), makeup salons, tanning salons, etc. Now they're everywhere. And those folks are making good money too
Wonder how much of it gets taxed? Which is a whole DIFFERENT topic!!

[SKKY]

10. I hope this is just the start.

[maxsolomon]

14. since this admin has been cancelling debt where it can since inauguration,

the start has passed.

https://www.businessinsider.com/student-loan-debt-cancellation-payment-pause-borrowers-disabilities-defrauded-2021-6

[maxsolomon]

13. it will never be good enough.

because he PROMISED (he didn't) to cancel 10K for all borrowers by waving a magic wand.

therefore, millennials have no choice but to sit on their hands in november and put the GQP back in control of the house.

[Joinfortmill]

16. I hope not. That will make life worse for them and for us all.

[maxsolomon]

19. of course it will.

it will make the next 2 years unbearable.

[maxsolomon]

38. I hear about Rogan from co workers all day

young Boomers and Gen Xers.

[I_have_a_cat_bite]

40. Whatever

I'm a millennial and I've voted in every election. My grandmother payed for my grandfather's college on minimum wage. You can't do that anymore. A lot of millennials are just depressed because your generation handed them a fucking garbage heap.

[Sympthsical]

45. You do know Millennials are in their 40s now, right?

I can always tell how much older the environment I'm in is when people talk about Millennials as if we're all a bunch of twenty-something slackers.

The oldest of us have sidled into middle age. We have homes and families and careers and everything! It's really quite something.

(I do like video games, though).

Also. I touched the lawn. I just wanted you to know. It was me.

[JI7]

51. Yes, but he is still right about the popularity of Joe Rogan among them

and younger people. Mostly men.

[I_have_a_cat_bite]

53. Not really

It's a white thing, not a generational thing. My grandfather's Joe Rogan was Bill O'Reily and my uncle's is Alex Jones.

[Joinfortmill]

15. Good. Give these people their lives back.

[867-5309.]

44. This equates to about $150 of a one million dollar debt

I don't oppose it, but it's so tiny as to be meaningless in terms of the complete problem.

[myohmy2]

47. about time...

...

[mahatmakanejeeves]

49. One of the smartest answers I've seen on student loan debt

David Weigel Retweeted

One of the smartest answers I’ve seen on student loan debt — from
@JDVance1

Asked JD Vance why he opposes Biden's potential student debt forgiveness:

Link to tweet