North Texas Objectivist Society (NTOS) Message Board › Supreme Court to Hear Student Loan Case

Supreme Court to Hear Student Loan Case

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A former member
Post #: 122
If this guy never has to pay it back I guess it's not a
" LOAN " it's a " GIFT "
Well at least he got" HIS MONEY BACK" As some would say. I sat Take every dime of the money till it's all paid back. That is why it's called a LOAN, that means you pay it back. The gov should not be loaning $ to start with.
I just wonder what the defualt rate is? I'll bet it's higher than any defualt reate in the USA. It says 7 billion, yet it does not sat what the rate is. Student loans, just 1 more way to bankrupt a nation, & take money from the ones that make the money to pay the taxes.

Jamie

Supreme Court to Hear Student Loan Case

By DONNA GORDON BLANKINSHIP
Sunday, October 30, 2005 6:51 AM CST
Print this story

SEATTLE - James Lockhart was surviving on $874 a month in Social Security disability payments plus $10 in food stamps when his student loans from nearly 20 years earlier caught up with him.

He was told his Social Security checks would be cut by 15 percent, an offset to pay more than $80,000 in delinquent student loans. The next day, he started legal action that has led to a hearing Wednesday before the U.S. Supreme Court.

The case is compelling because many other people are potentially in the same position as Lockhart, at or near retirement age with 20-year-old student loans still unpaid, said Deepak Gupta, an attorney working on his appeal. The government brief on the case said there is nearly $7 billion in delinquent student loan debt, with about half of that amount over 10 years old.

The case hinges on a pair of laws that send mixed messages about whether Social Security payments are shielded from the government's collection efforts: the Debt Collection Act and the Higher Education Act, or HEA.

According to Public Citizen Litigation Group, which is representing Lockhart, one federal appeals court has ruled in another case that the government is barred by the Social Security Act and the Debt Collection Act from offsetting Social Security payments to repay student loans that are more than 10 years old.

The 9th U.S. Circuit Court of Appeals, however, ruled in Lockhart's case that the HEA eliminated that bar, Public Citizen says.

Lockhart, now 67 and receiving old age benefits instead of disability payments, wouldn't comment. Speaking by phone from his home in Seattle, he explained that his attorneys advised him not to talk about the case until it has been settled.

Gupta, an attorney with Public Citizen, the public interest law firm founded by Ralph Nader, described Lockhart as an old, disabled man living in public housing and barely getting by on his Social Security payments. He has significant medical expenses following double-bypass heart surgery _ including six different prescriptions _ and because of diabetes.

Gupta said Lockhart had more or less given up on his case before the call from Public Citizen.

"We told him 'You have nothing to lose. They're not going to take away more money from you,'" he said.

The Supreme Court probably agreed to hear Lockhart's appeal because of the conflicting ruling by the 8th U.S. Circuit Court of Appeals in a nearly identical case. The appeal of the 8th Circuit case is on hold until the Supreme Court rules on Lockhart's case.

From 2000 through 2003, the Department of Education collected about $400 million a year in delinquent student loan debt through the offset program.

In a government brief to the Supreme Court, Solicitor General Paul D. Clement wrote that it is essential to eliminate the 10-year limit on collections through Social Security because offset typically only occurs because the student debtor has successfully evaded collection by lenders and collection agencies for many years.

The 8th Circuit case involves Dee Ella Lee of Kansas City, Mo., who took out two government loans to fund her studies. She defaulted in 1984 on more than $4,000, and in 2001 the federal government began offsetting her Social Security benefits, reducing her payment from $814 to $750 a month.

The 8th Circuit ruled that the 10-year limit on Social Security offsets applied and her benefits should not be cut.
A former member
Post #: 26
Yep, the government shouldn't be in the student loan business, just like it shouldn't be in the business of providing public roads and sidewalks, but until the law is repealed, rational people shouldn't feel any guilt over taking student loans, any more than they should feel guilt about using public roads while waiting for a pure capitalist society where the roads are private.
A former member
Post #: 124
Do you not understand, if he wins his case it is not a loan anymore. IT"S A GIFT IF YOU DO NOT HAVE TO PAY IT BACK! You must not have read the post listed below this one. THEY PAY NO TAX!!!!!!! Well 3.46% almost no tax. You also must not have read the post on this topic. Your a little late on this one. I can see them all trying to get out of paying thier loans now, over 50% of the " rational people " are not paying back the loan. Yet can you wonder why? I know why.

They are so smart, they can't even save any money or pay their debts. THEY ARE BROKE!!!!!!! They will stay broke also. Thats the way it is going now. We are the most educated in history of our nation. Yet in no way are we the smartest. They do not even understand the only 2 kinds of financial people in the world. The kind that pay %, & the kind that collect %. I learned that at 5 years old. From a man that did not finish the 8th grade. Yet he had been collecting % for many years.



BOTTOM 50% ONLY PAYS 3.46%
OF ALL INCOME TAXES.


national savings rate was minus-7 percent.


Jamiebiggrin
A former member
Post #: 27
I don't understand what your point is.
Dan
dbclawyer
Allen, TX
Post #: 5
The Court is not addressing whether this fellow has to pay the money back. He does. The question before the Court is whether the government may make deductions from his social security benefits for the purpose of repayment.

Regardless of the answer, the loan remains a loan; an unpaid loan, yes--but still a loan.

Dan
A former member
Post #: 128
The Court is not addressing whether this fellow has to pay the money back. He does. The question before the Court is whether the government may make deductions from his social security benefits for the purpose of repayment.

Regardless of the answer, the loan remains a loan; an unpaid loan, yes--but still a loan.

Dan


Dan,

I understand that, yet if that is the only income he has. And it must be he is on food stamps also. If they do not take it from his SSI Check where will they get it? If they do not take it from there & get never can make him pay it back. Just looks like one more big give away to me. I do not thhink the gov should give him any SSI till he pays them back.


Jamie
Old T.
OldToad
Group Organizer
Dallas, TX
Post #: 115
I do not thhink the gov should give him any SSI till he pays them back.

Hi Jamie,

I am not sure what you are advocating.

Are you saying this guy should get SSI payments if he first pays back the government loan?

Also, it appears this guy lives in a society that is too squeamish to allow an old guy to starve to death, so without much qualm it instead elects to tax producers (like you and me) to give SSI. Are you suggesting that this same society would be expected to be OK with letting the old guy starve if he owes a government student loan?
A former member
Post #: 132
Todd,

What I am saying, if he did not pay his car loan, they repo the car. The bank that is. If he does not pay his home note, they take the house. Is that mean? Many people get kickerd out of their home. Folks get booted out all the time. He has not paid his loan in 20 years. Why should they give him money & food stamps if he still owes money.To the same group he got the loan from. Why not " REPO " that SSI check & get some or all of the money back. HE MUST PAY!!!! HE ASK FOR THE LOAN, AS YOU CAN SEE HE NEVER SHOULD HAVE GOTTEN IT. How else can they make him repay the money. He has nothing else to pay it with.


SEATTLE - James Lockhart was surviving on $874 a month in Social Security disability payments plus $10 in food stamps when his student loans from nearly 20 years earlier caught up with him.

Also as you can see it appears that he has not made a payment in 20 years. Twenty years this guy has ran from his laon. I do not feel sorry for him at all.

Jamie
Old T.
OldToad
Group Organizer
Dallas, TX
Post #: 120
He has not paid his loan in 20 years. Why should they give him money & food stamps if he still owes money.To the same group he got the loan from.

Hi Jamie,

Your response raises an interesting point that we have debated before (without resolution). On the previous ocassions, however, you said that "the group" was not the same, so I am again confused about the positions you are advocating. This old guy borrowed money 20 years ago from "the group" (i.e., taxpayers in 1985), but now "the group" (i.e., the taxpayers in 2005), should repo the 2005 SSI checks to this guy? To whom do you propose we send the repo'd SSI checks?

-- Todd
A former member
Post #: 134
Todd,





Quote from Todd' last post

" This old guy borrowed money 20 years ago from "the group" (i.e., taxpayers in 1985), but now "the group" (i.e., the taxpayers in 2005), should repo the 2005 SSI checks to this guy? To whom do you propose we send the repo'd SSI checks? "


Well, lets use Bank One for this. Lets say he got the cash from Bank One 20 years ago for a home loan or what ever. Some of the same stock holders now also owned some Bank One stock 20 years ago. ( IE STOCK HOLDERS OWN THE BANK ) Now you'd agree that many of the stock holders have either sold their stock by now, died or whatever. SO NOW THEY DO NOT OWN BANK ONE. Yet someone else bought the stock. So now they own Bank One. Yet if this was the case he would still owe Bank One. So does the guy not now have to pay Bank One because someone else owns Bank One? With Bank One he would not owe them. THEY WOULD HAVE TAKEN HIS HOME BY NOW.

Is it not the same deal really when you think of it. This guys DEBT got passed to our nations debt. IE T-BILLS, EE BONDS, I Bonds & OTHER TYPES OF GOV BONDS. As you know Bonds change hands just as stocks do. The only thing bad about this. The % rate in 1985 was like 12% or even higher. That is how much was added to our debt per year till the bond got called. If it has been called yet. That we do not know. There are also 30 year bonds. His debt may still be with us for 10 more years. So yes the money he owes may still be owed to the same bond holder. Yet, someone owns those bonds backing his debt. We do not know who. Should the gov default on the bond holder because this guy did not pay his loan. NO THEY SHOULD NOT, Yet to pay off those bond holders because of his bad debt, they must raise more money to pay off the old bond holders. How is that done, by selling more bonds. We all know what happens then. When someone buys a bond % must be paid. How is % paid. We the tax payers of today must pay the %. So dose his bad debt affect us. Yes it dose. As dose the other 50% of the people that are not paying back their loans. The best way to know this would never happen again. STOP THE LOANS!!!!!!!!!!! If the guys do not pay, treet them just like a bank would. Start taking everything they have till the money is paid back. They need to start putting a lean on earned income when they make these loans. Try not paying Bank One for your home see what happens.





Jamie
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