On the day that Paul Ryan was to give his acceptance speech for the nomination of Vice-President, Ryan knew he had to bring it. Not just because needed to excite the base. Nor was it because he needed to set the narrative in a way that combated the attacks he has already received since Mitt Romney selected him as his running mate. No, he needed to hit it out the park, because a day and half of the same message from different people had grown, if not tedious, certainly stale.

We Built It and We Can Do better may be the rallying cry, but it needed to be told in a fresh way something fierce. If there were any worries about Ryan’s ability to get the job done, they were unfounded.

Simply put, Ryan knocked the ball out of the park.

In a speech that interwove his personal story and beliefs with the plans of a Romney-Ryan ticket, Ryan effectively made the case for the plans and policies they are fighting to implement. Many have commented on Ryan’s likeability and personable manner. Both traits came through in both tone and demeanor. Stories about his family and calling his mother, “his role model” are flatly stock in trade items in politics, but there was an earnestness that permeated through Ryan. He is not just saying these things, they are true for him. This will go a long way for him in the campaign, and made the strong medicine he threw at Obama non offensive.

In a speech that had plenty of zingers in it, Ryan nonetheless never made the attacks personal. They were, in fact, not attacks, so much as critiques. What was different in his speech, in contrast to the attacks thus far from President Obama, is that Ryan focused on the results of the last three years. He zeroed in on facts, and figures, but personalized their consequences.

He made it personal as he talked about the GM factory in his hometown of Jamesville, Wisconsin, the people that he knew who used to work there, and the Obama administrations broken promise to keep it open. This was in contrast to the half a billion the President used in Solyndra. 

Ryan is known as a policy guy. For him its about the numbers, the policy and the results that follow. Ryan, however, was able to explain, keep the speech flowing, serve red meat, and do it with in a humorous way. His best zinger perhaps being the vivid image he conjured with this line: “Americans in their 20′s should not have to move home with their parents house, living in their old rooms, looking up at fading Obama posters and waiting for life to begin.”

A comment meant to target younger voters, but still managed to convey an important message to adults as well. Its a tactic that he used more than once. Throw a funny zinger like, “The President has said he has not communicated enough. That is his job to tell a story. In the last four years we have not suffered from a lack of words from the White House. What we are missing is leadership in the white house.”

Never in the speech did it become about Obama personally or about ideology. Just the results and what needs to be done to get better results. This is why the speech was a home run. Not because he could get applause lines, or get a standing ovation from the people in attendance. They are all going vote for Romney and him anyway. No the brilliance was delivering a speech that moderates, independents, and apathetic voters can understand. The message came through because it was a truthful one delivered at partisan event that did not sound at all partisan. Not in tone. And that is what Romney will need from Ryan during the campaign.

Image Courtesy of  PBS News Hour

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New York, U.S.A. – Bankrate.com’s monthly Financial Security Index hit a new high of 99.9 in April 2012, surpassing the previous high-water mark of 98.5 that was last recorded in May 2011 (the polls began in Dec. 2010). Americans’ attitudes regarding their net worth and overall financial situation also reached new highs this month. Sentiment regarding savings improved for a fifth consecutive month, and Americans’ comfort level with debt is at its highest point since June 2011.

Despite these positive developments, Americans are still wary of investing in stocks. The poll found that 76% of Americans are not more inclined to invest in the stock market despite near record low savings rates, and merely 18% of Americans are more inclined to invest in stocks today. Another soft spot is job security: 22% of Americans reported less job security than one year ago versus 20% that reported better job security.

“Overall, there are several positives that can be taken from this month’s report,” said Greg McBride, CFA, Bankrate.com’s senior financial analyst. “Americans are feeling better about the money they have in the bank and in their investment portfolios, and they’re also feeling better about what they owe. However, job security is still a pain point, and there are plenty of reasons to worry that we might be headed into a third straight weak summer for the economy. The trouble spots include jobs, high gas prices, the ongoing European debt crisis and more.”

A reading of 100 is considered the Financial Security Index’s baseline; any reading above 100 indicates improving financial security compared to one year ago, while any reading below 100 indicates decreasing financial security compared to last year.

Here are more details regarding the components of the Financial Security Index:

Overall Financial Situation

• Consumers’ feelings about their overall financial situation hit a new high, with 29% saying their overall financial situation is better today than it was 12 months ago, compared to 26% saying it is now worse.
• Those under age 50 are more likely to report a better overall financial situation, while those age 50 and up are more likely to report a worse financial situation than one year ago.

Net Worth

• With the stock market near four-year highs, more consumers report higher net worth compared to one year ago than at any time since polling began in Dec. 2010.
• Twenty-nine percent report higher net worth versus 23% that report lower net worth.
• Households with income of $50,000 or more are the most likely to report higher net worth than last year.

Savings

• The margin between those feeling worse about their savings and those feeling better about their savings has been nearly cut in half since Dec. 2011.
• Those under age 30 tend to be more comfortable with their savings, and those age 50 and up tend to be less comfortable with their savings compared to other age groups.

Debt

• Americans’ comfort level with debt is at its highest point since June 2011.
• More consumers report being more comfortable with their debt than less comfortable.
• Households with annual income of $50,000 or higher are more comfortable than other groups, while households with income under $30,000 are less comfortable.

Job Security

• Job security slipped following the disappointing March jobs report that was released on April 6.
• Only one in five (20%) Americans say they are more secure in their jobs compared to last year; 22% are less secure.

Investing in Stocks

• Those under age 30 are only slightly more inclined to invest in the stock market than the overall average (23% versus 18%), despite having the luxury of a long time horizon and having a greater burden of retirement savings than any previous generation.

The new study was conducted by Princeton Survey Research Associates International (PSRAI) and can be seen in its entirety here: http://www.bankrate.com/finance/consumer-index/financial-security-poll-0412.aspx.

The PSRAI April 2012 Omnibus Week 1 obtained telephone interviews with a nationally representative sample of 1,000 adults living in the continental United States. Telephone interviews were conducted by landline (600) and cell phone (400, including 191 without a landline phone). Interviews were done in English by Princeton Data Source from April 5-8, 2012.

Statistical results are weighted to correct known demographic discrepancies. The margin of sampling error for the complete set of weighted data is plus or minus 3.6 percentage points.

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A new study shows that students are struggling more and more with student loan debt. Currently, 27 percent of student loan borrowers have past due balances by at least one month, according to new Federal Reserve data of delinquent student loan debt.

This statistic is not in the least bit surprising. Students who currently struggle with student loan debt do so because they follow a pattern: they go to college to get better jobs, then find they may need to further their education at an institution of higher learning in order to get a job that will pay well enough to eliminate their student loan debt in a reasonable amount of time. As a result, they have to take out more loans, which leads to more debt.

The study also took information from Equifax credit reports and found that 15 percent of the United States population has student loan debt and that 40 percent of those under the age of 30 with student loan debt have outstanding student loans of over $20,000 on average.

Furthermore, students need to take out more and more money in loans as tuition prices increase. According to websites like finaid.org and a CBS News report, in the 2011-2012 academic year, college tuition increased at an of average of 4.6 percent at private colleges and universities, while the tuition at public colleges and universities increased on average 8.3 percent. Not only are students required to increase their student loan debt in order to further their education, but they are also required to pay more for increases in the tuition from year to year.

To put it in perspective, the tuition at Connecticut College–a private college in New London, Connecticut–for the 2011-2012 academic year was $54,970. If that increased by 4.6 percent, the cost to attend Connecticut College in the 2012-2013 academic year would be $57,499.

Meanwhile, the tuition at the University of Vermont–a public university in Burlington, Vermont–was $23,418 for a Vermont resident and $41,982 for a student coming from outside of Vermont. If these figures increased by 8.3 percent, it would cost Vermont residents $25,362 for the 2012-2013 academic year, and out-of-state students would pay $45,467 for the 2012-2013 academic year.

Considering all of this, it is not at all shocking that students are taking out more and more loans and are currently struggling with the enormous debts they have amassed. With rising tuition prices and an increasing need for a better degree, Americans are taking out far more loans than they can literally afford.

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Consumer interest and media attention spiked in mid-January 2012 when personal finance expert, Suze Orman, introduced a prepaid debit card with the potential to help improve credit scores.

In a unique pilot program, transactions on Orman’s cards are reported to TransUnion to determine if spending activity can be included in credit scoring.  Other celebrities including Russell Simmons, Alex Rodriguez and even the Kardashian sisters have sponsored cards, bringing broader awareness to consumers; but the question is: Are they right for you?

To shed some light on prepaid debit cards and help answer this question, InCharge Debt Solutions provides the following basic information on how these cards work, the pros and cons along with the three questions consumers should get answered before they sign up.  InCharge is a leading nonprofit organization that interacted with more than 1.1 million consumers in 2011 providing free credit counseling and personal financial literacy education.

“Prepaid debit cards certainly serve a purpose and offer many Americans financial opportunities and services for which they cannot otherwise qualify,” says Etta Money, president of InCharge.  “However, there certainly are some potential pitfalls and, if you’re not careful, negative financial consequences can result.”

What it is: A prepaid debit card is simply a reloadable card provided by a bank or other financial institution that allows you to only spend up to the amount you have pre-deposited into the account.  “Prepaid cardholders want total control of their money and to know in real time exactly what is spent, where, and how much money is left,” notes Kirsten Trusko, president of Network Branded Prepaid Card Association (NBPCA).

“These consumers are budget conscious and focus on their lowest cost option for the services they need, and they do so without traditional bank accounts, branches and paper.”

“A prepaid card can be a useful budgeting tool to segregate funds and enforce spending limits, to limit loss and fraud exposure when traveling, provide secure funds to children or for immigrants to remit money to relatives living in other countries,” advises Ben Woolsey, director of marketing for CreditCards.com.

The Pros and Cons: In today’s turbulent economy, a growing number of consumers are experiencing credit problems and prepaid debit cards help because they are much easier to qualify and/or pay for than traditional banking or credit accounts.  Other advantages include fraud liability protection; Visa/MC/Discover/Amex symbol enabling online transactions; cash from ATM machines; and less costly than check cashing services.

“On the down side, virtually all prepaid cards come with a myriad of fees,” cautions Woolsey.  “Some prepaid debit cards are clearly more consumer-friendly than others – charging very nominal monthly fees and function much like a virtual checking account.”

Additionally, disadvantages include: fees for loading money or using the card; more expensive than a checking account and when using an ATM at the host bank; and, very limited reporting to credit bureaus and not likely to help improve your credit like a traditional or secured credit card.

Three Questions to Answer: InCharge recommends that consumers get answers to these three questions before signing up for a prepaid debit card:

1.) Is it right for you?

“Contact the bank or financial institution of your choice and find out if you qualify for a bank account and debit card, and what costs are involved so you can compare,” says Money.

“Some parents use prepaid cards for their children so they can track expenses and limit spending amounts, so there are many things to consider when deciding if they are right for your situation.”  Trusko’s NBPCA has some great information and questions to ask yourself in order to make your decision at http://www.nbpca.org/Consumer-Corner.aspx.

2.) What are the cards features and costs?

“The best way to choose is to compare fees of the various cards in one place and understand if there is a cost to apply, receive the plastic, activate and/or to load,” recommends Woolsey.  “Annual or monthly fees can also be common but must be disclosed along with any other charges in the terms and conditions of the application.”  Once again, NBPCA has a tool that can help you compare which card is right for you at www.prepaid101.com.

3.) What should I know about these cards?

Before you make any decision on a new financial tool, take a little time to research it and make sure you understand important details and the pros and cons.

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China owns America, according to the Tea Party. Although the recent rumor that China possesses a larger percentage of government bonds than the American government itself has been busted, the idea has sparked debate over the future of the global financial market.

China, the 3rd largest country (by landmass) with the second leading economy in the world, does in fact own the largest single share of foreign-owned American Treasury securities (36 percent), some $1.16 trillion. That’s 16 percent of total U.S. debt.

Back in 2006, it was calculated that China added $30 million to its reserves of foreign currencies every hour (Bonner, Bill: “China’s Dollar Reserves, America’s Debt”). China’s pool of reserves had topped $1 trillion, approximately 20 percent of all dollars worldwide. This immense cache is the result of a large current-account surplus, significant inward foreign direct investment, and big inflows of speculative capital.

Though this influx of foreign currency would theoretically have dramatically increased the worth of the Yuan, the Chinese government instead resisted this increase, keeping labor and exports dirt cheap for foreign investors.Thus, China has expressed concern over the security of its vast holdings.

Realistically, any nation should control assets denominated by several currencies, commodities, and direct overseas investments in order to avoid the sharp depreciation of any one type of asset. “We hope the U.S. government concretely takes responsible policy measures to increase the confidence of international financial markets and respects and safeguards investors’ interests,” the State Administration of Foreign Exchange said in a statement.

In an e-mail in August, Yu Yongding, a former advisor to China’s central bank, remarked that the U.S. Treasuries fail to provide safety or liquidity in managing China’s foreign-exchange reserves, worth $2.45 trillion. He went further to say that, in order to help lessen demand for the securities, China needs to curb the growth of its foreign reserves by pulling out of the currency market.

As a result, in the 12 month period ending in July, China has cut its holdings by about to 10 percent to $846.7 billion, according to the U.S. Treasury Department. Additionally, China and Russia came to an agreement in 2010 following the global recession.

In the agreement, they would use their own currencies for bilateral trade rather the commonly used American Dollar and other similar Western currencies. They may not be outright denouncing the dollar in this act, but they are certainly challenging its rule.

Image Courtesy of  http://www.flickr.com/photos/nznationalparty/

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With the recent near-default of the American government, we are forced to take a closer look at the dark rabbit hole that has become the federal budget. A short plunge into history will surface in a debate of the politics of the current financial crisis: Over the past century, the world has changed dramatically, contributing to and resulting from globalization.

Like the domino effect, once science reached a certain point of innovation, the world population exploded, creating a systematic and uncontrollable increase in both processes over the following years. The U.S. government reflects a clear example of this incredulous expansion. The 20^th century saw America transform from an infant nation into the leading nation of efficiency, compassion, and modernity.

At the helm of the 1900’s, the U.S. government consumed merely 6.9 percent of Gross Domestic Product (GDP, a minority of which was due to federal spending. However, World War I brought a kick to spending, and culminating at about 12 percent of GDP in the 1920s.

President Roosevelt and the New Deal brought spending up to 20 percent during the Great Depression, but it was during World War II that government spending peaked to 53 percent of GDP in 1945. In terms of government spending, the post -World War II era marked itself as the Golden Age, despite President Clinton’s 1995 declaration that big government spending has finally come to an end.

Immediately after WWII, spending dropped to 21 percent, but by the recession of 1980-82, hit a peak of 36 percent. Government spending averaged 32 percent of GDP until the disastrous recession of 2008, in which spending surged to wartime-like spending, 45 percent, thanks to bank and automotive industry bailouts.

      VS.    

The federal budget for the 2011 fiscal year outlines exactly what the enormous percentage of the GDP amounts to. As seen in the pie chart below, courtesy of usgovernmentspending.com, the $3.8 trillion in expenditures is divided into 5 categories, in descending order of dollars spent: defense, healthcare, pensions, “other”, and welfare.

Defense, 25 percent of the budget, plunders a whopping one trillion dollars. Health follows at a close second with $0.9 trillion, or 23 percent. Pensions, at 21 percent, translate to $0.8 trillion. Welfare constitutes 13 percent of the budget with $0.5 trillion, with the remaining 18 percent pulling $0.6 trillion – including, but not limited to, education.

According to USA Today, the national debt has mounted to such a number that, to repay it entirely, each American household would have to fork over a whopping $668,621. In other words, with absolutely 0% interest, the most manageable payment plan would involve a $13,364 annual payment for the next 50 years per household, or approximately the annual tuition rate for a state-subsidized public American university.

To clarify, this number is only the amount of debt as it stands today, not the additional debt of next year, the year after, etc.

The level of debt has become so outrageous that, last month, the United States government was forced to raise its debt ceiling or face default. The latter decision would have crippled the government, rendering it incapable of basic function and placing the civil population into very real danger.

Welfare and public education would eventually become inaccessible, and troops abroad would be marooned without funding. Additionally, a debt default would have led to an enormous depreciation of the dollar and possible another global recession, due to a reduction in worth of all dollar-back assets worldwide.

Luckily, the Senate cobbled together a last minute compromise that left much to be desired. This heartbreaking piece of work was the result of months of partisan bickering and head-butting. As a result, the DJIA drop 1500 points in little over a week, and the S&P graciously downgraded U.S. debt for the first time in history.

How this will affect the American economy remains to be seen, but the future surely is not bright. Think the government can tighten their belts and spend within their limits? If it means we all must draw back a little bit, then here’s a rally towards a healthy economy in the unfortunately far off future.
Stephen C. / Shutterstock.com

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As the politicians play chicken with the debt ceiling, credit rating agencies are beginning to downgrade America’s credit, a move that could have far-reaching implications. On Thursday, Standard & Poor warned America that there is a one-in-two chance it could cut the United States’ prized triple-A rating unless a deal on the government’s debt ceiling is worked out soon.

“Today’s CreditWatch placement signals our view that, owing to the dynamics of the political debate on the debt ceiling, there is at least a one-in-two likelihood that we could lower the long-term rating on the U.S. within the next 90 days,” the agency said in a statement on Thursday.

Although the deadline to raise the ceiling is August 2^nd, it could come before that date depending on interest rates and a variety of other factors.

“We have also placed our short-term rating on the U.S. on CreditWatch negative, reflecting our view that the current situation presents such significant uncertainty to the U.S.’ creditworthiness,” the statement read.

“If an agreement is reached, but we do not believe that it likely will stabilize the U.S.’ debt dynamics, we, again all other things unchanged, would expect to lower the long-term ‘AAA’ rating, affirm the ‘A-1+’ short-term rating, and assign a negative outlook on the long-term rating,” said S&P.

Republicans refuse to raise the debt ceiling unless they get some real meaningful cuts. Even though one does not really have much to do with another. Even though, under the last president, the debt ceiling was raised seven times and no Republican objected over spending cuts or other nonsense then.

Speaker John Boehner (R-Ohio), meanwhile, reiterated his position that the administration’s approach was insufficient for resolving the nation’s debt problem. “He continued to press the White House to get serious about reducing spending in a meaningful way,” a Republican aide said.

Treasury Secretary Timothy Geithner has warned lawmakers that the government was “running out of time” to negotiate. Office of Management and Budget committee chair Jacob Lew, along with top economic adviser Gene Sperling “walked through proposals for getting savings out of health care entitlement programs, tax expenditures and budget process changes,” according to a Democratic official familiar with the talks.

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Sen. Orrin Hatch (R-Utah) believes that the poor, not the rich, should pay more to help reduce the nation’s debt. Just another example of a Saturday Night Live skit that has come to life. “I hear how they’re so caring for the poor and so forth,” Hatch said in remarks on the Senate floor Wednesday, in reference to Democrats.

“The poor need jobs! And they also need to share some of the responsibility.” Hatch made these comments during debate on a motion that would allow the Senate to begin debating a non-binding resolution that says millionaires and billionaires should play a more meaningful role in reducing the nation’s debt. The motion passed 74 to 22 despite Hatch’s argument. Only one Democrat, Sen. Ben Nelson (D-Neb.) voted against the debate while Sen.

Jeff Sessions (R-Ala), who had called the resolution “pathetic”, voted to move ahead with the debate. But, the attention fell on Hatch on Wednesday when he suggested that the wealthy in the nation are already doing too much. Even though, if you remember, the nation’s effective tax rates are at modern lows since the Bush administration slashed rates in 2001 and 2003. In his view, it seems, the middle class and poor should be picking up the slack.

“The top 1 percent of the so-called wealthy pay 38 percent of all income tax. The top 10 percent are paying 70 percent of all income tax,” Hatch said. “The top 50 percent pay somewhere near 98 percent of all income taxes. 51 percent don’t pay anything,” Hatch said, suggesting the payroll taxes that the poor and middle classes pay towards Social Security yields them an especially generous benefit. “Democrats say they [the 51 percent] pay payroll taxes.

Well, everybody does that because that’s Social Security. They pay about one-third of what they’re going to take out over the years in social security,” Hatch railed. “Obamacare — a family of four earning over $80,000 a year — gets subsidies. Think about that. That’s what we call the poor?”

Hatch hedged that the poorest of the poor shouldn’t have to pay taxes. But he was clear that people who qualify for subsidies because they can’t afford things like health care should dig deeper. “Now, we don’t want the really poor people who are in poverty to have to pay income taxes,” he said.

“But 51% of all households. And that’s going up, by the way, because of our friend down in the White House and his allies.” Dude, you cannot get blood from a turnip. There is nowhere else for me to dig. The wealthy have savings and retirement accounts. I don’t.

Image Courtesy of  http://www.flickr.com/photos/bvcphoto/3178527172/

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Greek crisis evokes the concerns about the country’s future, since the 110 billion euros bail-out given by EU/IMF is about to run-out, and despite the vote of confidence for George Papandreou’s government on June 22, Greeks seem extremely unpleased to run into more debt in return to meet the the conditions of European Union by sacrifising more . Greek unrest does not seem to calm down within a short-time.

The country is facing real hard times after the recession in 2009. Currently, the debt is 340 billion euros, which means for a country of 11.3 million population the debt per person is more than 30.000 euros. According to Standard & Poors, Greece became the lowest-rated country in the world, despite the efforts of the European partners. The recent Reuters article “Quick Guide to the Greek Crisis” indicates that, “Greece holds two unwanted world records: the lowest credit rating for a sovereign state, and the most expensive debt to insure”.

On Thursday and Friday, EU leaders in Brussels is going to discuss a new Greek bailout, in return for the commitment of economic reform in Greece,  since EU leaders share the concern that a possible Greek default is going to harm the confidence in the euro. Greek example is bringing up the question of European Union’s credibility.

Slavoj Zizek, one of the most influential philosopher and critical theorist of our century, in his “Capitalism and Assault on Reason” article, claims that the Greek crisis is a sign that “not only the Euro, but the entire project of the European Union itself is dead.”

Zizek, sees “Brussels-shaped cold Europe”, against Greek passion and corruption, or in other words, reason against pathos.

Despite the drift of  financial crisis, Zizek offers to hold on to an internationalist and universalist approach by re-politicizing Europe by evoking the phenomenon of ancient Greek democracy and French revolution, instead of adopting a  speech of global capitalism.

Defined as a post-Marxist  philosopher Zizek emphasizes on Marxist jargon and offering communism as an alternative:

“What I would argue is that this state of affairs demonstrates why we need an alternative to the current system of global capitalism, and that communism remains the best name for that alternative. For communism begins with the “public use of reason,” with thinking, with the egalitarian universality of thought.

When St Paul says that, from a Christian standpoint, “there are Jew nor Greek, no slave nor free, no male nor female,” he was thereby claiming that ethnic roots, national identity, gender and so on are not a category of truth.

Or, to put it in precise Kantian terms, when we retreat to the comforts of ethnicity, localism, or even the indulgences of commodity capitalism, we engage in a private use of reason, constrained by contingent dogmatic presuppositions.

We behave, in other words, as “immature” individuals, not as free human beings who occupy the dimension of the universality of reason.”

For Zizek’s insight of economic crisis and critique of capitalism, please watch his interview with Riz Khan, “Are we living in the end times?”

Find more at http://english.aljazeera.net/programmes/rizkhan/2010/11/201011111191189923.html

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The foreclosure crisis and the staggering unemployment rate have been the looming economic stories of the past two years.  However, student loan debt should not be ignored.  Universities, colleges, banks, and other student loan finance services have all taken advantage of our nation’s youth in order to pad their bottom line.  With foreclosures and other credit problems, there is a way out.  The student loan problem is one that a person can never be freed from.

Lenders have nothing to fear when giving out money for school.  The loans are guaranteed by the government.  If a person defaults on the loan, the lenders are not forced to go through collection agencies where they will likely never see their money.  Oh no.  They have the government in their back pocket.  The government will punish defaulters by garnishing wages, withholding tax refunds, or even docking social security checks.  For-profit colleges are often the worse culprits of the scam.  They don’t work for students.  They work for CEO’s and shareholders, and they have rewarded top executives very handsomely.

Senator Tom Harkin (D-Iowa) and his committee investigated the for-profit college crisis last year.  Harkin stated that for-profit schools often use deceptive recruiting techniques, have overpriced programs, and end up with huge profits while the most vulnerable students are left with staggering debt.  Very similar to the subprime mortgage collapse, for-profit colleges are using the lure of higher education to entice prospective students to take out huge student loan debts that they cannot afford.  Schools used misleading recruiting tactics to convince would be students that they will be able to afford the loan payments after graduation.  A recent General Accountability Office investigation revealed that all 15 schools that the office visited this past spring were using deceptive recruiting practices to convince students to enroll.

For-profit schools also have very poor success rate.  A recent investigation looked at 16 large for-profits schools and found that 57 percent of students who enrolled in 2008-2009 had dropped out, most within four and half months.  Even at the largest for-profit college, more than 64 percent of those seeking an associate’s degree dropped out within the first year.  But these for-profit schools are still raking in record high profits despite their lack of success.

“CEOs at for-profit education companies are rewarded with mega-million-dollar, taxpayer-funded salaries, even as the low-income students targeted by these schools struggle with staggering debts,” Senator Harkin wrote in a blog for The Hill.  He goes on to mention that the college Strayer, a chain of for-profit schools, receives three-quarters of its revenue from U.S. taxpayers.  The chairman and CEO of Strayer received $41.9 million last year, nearly 60 times the compensation of Harvard’s president.

It is clear that there has been no federal oversight and the student loan industry is as corrupt as the mortgage industry.  Other than Sen. Harkin though, most lawmakers are silent on the issue.  I have written to many members of Congress about the issue and have never received a personal response. Just the same old canned crap.  How long will America’s young adults be forced to suffer before the government steps in and cleans up the mess that greedy colleges and student loan companies have left behind?

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