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Collection agencies do not make condolence calls. I understand this, believe me. But there are certain events in life during which people deserve to be treated with more than standard human decency. (Yes, I realize I’m pretending that treating people with human decency is standard these days. Humor me.) A death in the family — especially the death of a child — is one of those times.

Or at least it used to be. The story of Francisco Reynoso’s struggle to pay off his dead son’s student loans, while dealing with collection agencies in the midst of his grief, suggests that times are changing. And not for the better.

Apparently, Ben Franklin was only partly right. These days, nothing in life is certain, except death, taxes, and student loans.

A few months after he buried his son, Francisco Reynoso began getting notices in the mail. Then the debt collectors came calling. “They would say, ‘We don’t care what happened with your son, you have to pay us,’” recalled Reynoso, a gardener from Palmdale, Calif.

Reynoso’s son, Freddy, had been the pride of his family and the first to go to college. In 2005, after Freddy was accepted to Boston’s Berklee College of Music, his father co-signed on his hefty private student loans, making him fully liable should Freddy be unwilling or unable to repay them. It was no small decision for a man who made just over $21,000 in 2011, according to his tax returns.

“As a father, you’ll do anything for your child, Reynoso, an American citizen originally from Mexico, said through a translator.

Now, he’s suffering a Kafkaesque ordeal in which he’s hounded to repay loans that funded an education his son will never get to use loans that he has little hope of ever paying off. While Reynoso’s wife, Sylvia, is studying to be a beautician, his gardening is currently the sole source of income for the family, which includes his 18-year-old daughter Evelyn.

And the loans are maddeningly opaque. Despite the help of a lawyer, Reynoso has not been able to determine exactly how much he owes, or even what company holds his loans. Just as happened with home mortgages in the boom years before the 2008 financial crash, his son’s student loans have been sold and resold, and at least one was likely bundled into a complex Wall Street security. But the trail of those transactions ends at a wall of corporate silence from companies that include two household names: banking giant UBS and Xerox, which owns the loan servicer handling the bulk of his loans. Left without answers is a bereaved father. (more…)

Senate Republicans today filibustered the effort to prevent federal student loan rates from doubling, once again obstructing the majority and putting the finances of millions of college students at risk for the sake of protecting the leather wallets of the 1 percent.

Forty-five Republicans voted against allowing the measure to come to the floor for a full debate and up-or-down vote (52 voted in favor; 60 votes were required) even though Senate Majority Leader Harry Reid agreed to their demand that they be allowed to bring to the floor their proposal to eliminate an illness prevention and public health program to cover the $6 billion cost of keeping student loan interest rates as they are, at 3.4 percent. That was the proposal passed by Republicans in the House, which President Obama has already said he would veto.

Senate Republican Leader Mitch McConnell’s excuse? As reported by Politico, “While we don’t think young people should have to suffer any more than they already are as a result of this president’s failure to turn the economy around, we just disagree that we should pay for a fix by diverting $6 billion from Medicare and raising taxes on the very businesses we’re counting on to hire these young people.”

First things first. The real problem with this whole debate over student loan interest rates is the fixation over how to “pay for it.” The same conservatives who argue that we must, must cut something—hmm, health care’s not that important; let’s cut that—to cover the cost of keeping a lid on student loan rates don’t have the same fixation over students being loaded down with that debt to begin with.

Why? Because they argue that students will ultimately benefit from the increased salaries they are more likely to get with a college education and can therefore absorb the cost over time. (more…)

Readers may remember my last, shall we say, dialogue with the great Republican thinker Todd Akin. Akin is rapidly becoming one of my favorite Republicans because he articulates the party’s true positioning on issues so well. He has been back in the news recently with this gem of a quote about student loans: “America has the equivalent of the stage-three cancer of socialism because the federal government is tampering in all kinds of stuff it has no business tampering in.” While Mitt “Etch A Sketch” Romney and other Republicans are back-pedaling as fast as they can on the student loan issue to make it sound like they don’t want student loan interest rates to go up, Todd Akin and the other right wingers who control the Republican party are digging in, questioning the whole idea of whether the government should even be involved in student loans.

Please, keep speaking out, Congressman. Your country, your Party, and my Party especially all need you to keep making clear the true Republican position on student loans.

There couldn’t be a clearer distinction between Republicans and Democrats, between conservatives and progressives than on this issue. What Democrats, progressives, and incidentally the American people believe is that one of the best ways to rebuild the great American middle class is to invest in our young people’s education through both high-quality K-12 public education and through grants and loans for college students. Thomas Jefferson’s dream of public education for all, Abraham Lincoln’s idea of a land grant university system, FDR’s plan for a GI Bill for our country’s soldiers so they could get a college education after serving their country, and Claiborne Pell’s bill that gave grant money for college students in need helped create the legacy of a strong middle class in this country. We created a way for poor and working class kids to get a good education and make a better life for themselves than their parents had, and that made us a stronger country.

The American middle class, the largest and most prosperous middle class in the history of the world, was not built by accident. It was built brick-by-brick by the generations that came before. It was built by raising our wages through the power of the labor movement and the minimum wage; it was built by providing incomes, health care, and a safety net for our senior citizens and those with disabilities and those who had hard times; it was built by protecting us from financial speculation and the specter of bank runs; it was built by investing in roads, bridges, highways, and rural electrification; it was built by investing in the kind of R&D that created the transistor chip and the Internet; it was built by encouraging entrepreneurship and small business strength through vigorous anti-trust enforcement; and it was built by investing in the education of our young people. Education was one of the cornerstones. (more…)

Interest rates for student loans will double on July 1 unless Congress acts. That’s outrageous — but the fiscal abuse of our nation’s young people runs far deeper than that. An entire generation has been trapped into debt servitude and joblessness by the implacable machinery of Wall Street greed. Bank-servile scolds insult the young people of America while the bankers’ economic engines strip-mine their financial future.

Jobless or overextended college graduates aren’t even allowed to declare bankruptcy — a privilege that’s extended to every reckless investor and mismanaged corporation in the nation. Once they finally find work, college graduates face years of garnished wages to repay the loans that funded their often-overpriced educations. If they haven’t repaid that debt by the time they grow old — a very real possibility at the cost of a college education today — they’ll even be forced to surrender part of their Social Security benefits.

That’s indentured servitude.

Meanwhile banks have been slicing and dicing student loans into derivative financial instruments called “SLABS” — student-loan asset backed securities. We’ve seen this movie before — the one where big banks mass-market loans to a population with stagnated wages and dwindling economic prospects, then bundle them and sell them to investors who haven’t reviewed the way they were underwritten and sold.

Hey, what could go wrong?

It’s true that many of these packaged debts are backed by the U.S. government — but not all of them.

Why are these graduates facing such a bleak job market? Because Wall Street’s gambling on other financial bets crashed the economy, leaving an entire generation without much of a future to give them optimism and hope. Their parents can’t help them much, because most of their assets were taken by Wall Street, too. So as an entire generation of college students graduates with unprecedented debt — and joblessness that’s unprecedented in modern memory — they’re looking forward to a lifetime of reduced expectations. (more…)

We’ve spent billions of dollars – perhaps trillions – to rescue big banks. But instead of dialing back on the risky behavior that shattered the economy in 2008, they’re doubling down on it. And when their bill comes due we won’t just be asked to pay it again. We’ll be asked to take the blame for it again, too.

But who are the real deadbeats in this country? Banks acted recklessly in the years leading up to the financial crisis – and ran up a bill which the rest of us have been paying since 2008. And guess what? They’re doing it again.

Take student loans. Americans owe more than a trillion dollars in student loans, a figure that’s growing by $50 to $60 billion every month. Now we’ve learned that as many as 27% of these loans are delinquent, meaning they’re more than thirty days past due. That amounts to roughly $270 billion in troubled loans – most of which have been guaranteed by the U.S. taxpayer.

We’ve already rescued American banks with hundreds of billions in public money, saving them from the consequences of their incompetent underwriting of mortgage loans. Now we’re about to do the same thing with student loans, many of which were money-making ventures for those same banks.

Politicians “privatized” Sallie Mae, the government-sponsored enterprise (GSE) created to help students borrow for their education. Its greed-crazed executives promptly went on a spending spree, using their government backing to pay themselves inflated salaries and buying corporate jets so they could travel in luxury. Yet, without irony, their backers and shills shrieked “socialism!” when wiser heads wanted to stop private-sector skimming at the expense of our nation’s students. (See “Sallie Mae’s Jets.”)

And now that their loans are going bad, who will pick up the tab? It won’t be those high-flying executives. And Wall Street won’t be held accountable for the fact that today’s graduates face the worst employment situation in recent memory, even though that’s a direct result of bank malfeasance. Instead the public will pay the tab for this consequence of the banks’ behavior, just as it has paid for so many others.

Student loans aren’t the only burden young people – and the rest of us – are carrying today. Today’s college seniors are also graduating with an average of more than $4,000 in credit card debt – and then entering an economy where only 46 percent of their peers in the 18-24 year old age group have jobs. That’s the lowest percentage since the government began tracking these figures in 1948.

Credit card debt is another exploding area of risk for America’s too-big-to-fail banks – and therefore for the Federal government. In this country there are now more than 50 million American Express credit cards in circulation, along with 176 million Mastercard credit cards and 261 million Visa credit cards. That’s nearly half a trillion active credit cards from these three companies alone.

Credit cards are unsecured debt, meaning that nothing has been put up as collateral if the borrower defaults. Credit-card holders owed a reported $771 billion – more than three-quarters of a trillion dollars – in the second quarter of 2011. The average amount owed by a credit-card-holding household was more than $16,000. (more…)

If you are a working/middle class, working poor, student, or elderly person who vote republican punch yourself in the face! Believe me, you deserve it! The GOP plan for jobs is to give the already record profitable corporations and wealthiest earners more tax cuts and deregulation!