Before there was Bernie Sanders there was Barack Obama, who throughout his eight years in office has been the benefactor of free stuff long before the current Presidential candidate for the Democratic party began running on a platform of cradle to grave welfare. And whether it was free Obama phones or free Obamacare to the poorest in the land, perhaps the biggest ‘free’ gift the commander-inf-chief gave to millennials was access to unlimited debt.
The current 18-30 generation in just eight years has compiled more than $1 trillion in student loan debt. And perhaps the most devious thing behind this is that access to hundreds of thousands per person in student loans was done with the knowledge that there were going to be no real jobs created during his tenure, and as a side effect the system helped create new debt which was absolutely necessary to keep the financial system from imploding.
The U.S. government has more than seven trillion dollars of debt that must be “rolled over” each year. In other words, the federal government must issue more than seven trillion dollars of new debt just to pay off old debts that are coming due.
If something were to happen which would cause the rest of the planet to either be unwilling or unable to lend us trillions of dollars at ridiculously low interest rates all of a sudden, the game would be over. – Economic Collapse Blog
But perhaps the saddest part for this age group is that colleges no longer teach knowledge or skills worthwhile in today’s economy. And by making it easy for young adults to borrow ungodly amounts of money without being raised with any fiscal responsibility, the inevitable result was that many would go to a university for much longer than four years, and use this free money on things having little or nothing to do with education.
According to a survey, about one in five American students graduating this year who carry debt said they used student loans to pay for expenses such as vacations, dining out, and entertainment reports Bloomberg.
Texas A&M graduate Eric Hazard recalls the excitement of student loan refund day.
“Checks were celebrated across the campus as almost like a bonus for being a college kid. [Students] would go directly to the bank to cash it. I bought electronics for my dorm room and drinks were on me for a month or two. In an abstract way, I knew I would have to pay it back. But you don’t have a timeline in your mind about what that was going to look like. I just knew it would happen later.”
Ah later, later is good. However, if Visa has anything to say about it college debt is just phase one, those millennials who are graduating will be ushered into a plan where they will be saddled with a lot more debt throughout life, so that “later” may have to turn into “much later”, or perhaps “never.”
Does taking the left over student loan money and blowing it on electronics, booze, and vacations violate lending agreements? Not necessarily says Mark Kantrowitz, publisher of a student loan informational website Cappex. And even if there were violations, students wouldn’t face consequences.
“If someone is using it for something like going out on a date, to see a baseball game, it’s not a legal violation,” he said. “Once that money is in the student’s hand, there is no control to ensure that they’re spending it on textbooks, apartments, or food. There’s nothing to prevent them from buying an iPad, and technically an iPad might be OK.”
How about spring break, or a six-pack? Kantrowitz said it might violate the letter of the lending contract, but the student wouldn’t face repercussions. – Zerohedge
So in the end it is not surprising that millennials are flocking to Bernie Sanders because they have already experienced nearly a decade of free money and free stuff without the slightest thought as to who is paying for it, and how it will be paid back.
And for the government, enslaving an entire generation in debt is not only a societal perk towards their desire for control over the masses, but it also helps the banks create more debt to keep the financial system leveraged for a few more years.
Kenneth Schortgen Jr is a writer for Secretsofthefed.com, Examiner.com,Roguemoney.net, and To the Death Media, and hosts the popular web blog, The Daily Economist. Ken can also be heard Wednesday afternoons giving an weekly economic report on the Angel Clark radio show.