Tag Archives: Socialism

News

Canadian court rules that student need not repay 50K of student loans

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Story from Yahoo News.

Excerpt:

A Nova Scotia court has ruled that a former university student does not have to pay back tens of thousands of dollars he borrowed from a bank.
Alfredo Abdo won his case in bankruptcy court this week, with the court concluding that the Royal Bank of Canada was at least partly responsible for what happened.

“I question whether advancing all that money at one time was prudent banking on the part of RBC,” registrar Richard Cregan said in a written decision.

Abdo was a promising engineering student at Dalhousie University in September 2004. He had good grades, a scholarship and lived at home with this family.

In his second year, at the age of 19, he borrowed $20,000 from RBC though a student line of credit. He made bad investments online, according to court documents, and he accepted an offer from the bank for another loan of $30,000 to solve his problem.

Abdo started having dizzy spells. Finding his engineering program very stressful, he switched to commerce. But he dropped out of university in his third year.

The dizziness and social anxiety never went away, Abdo said, and therefore he couldn’t work or pay back the bank loans. He filed for bankruptcy last November.

The Canadian court probably thinks that they are compassionate, good people sticking it to the corporations. But actually what they’ve done is caused the banks to think a second time about making loans to borderline cases, so that the poorest students will now be refused student loans. If the courts refuse to enforce contracts signed by both parties, then the banks just won’t enter in to those contracts.

Down in New Zealand, they have the same problem.

Excerpt:

Thousands of people with student loans are defaulting on payments, leaving the Government to chase hundreds of millions of dollars.

More than one in five borrowers – or 114,000 people – have overdue payments and thousands of students are leaving tertiary education with no qualification and big bills.

The Education Ministry’s student loan scheme annual report shows that $306 million in payments is overdue, a $100m increase from a year ago.

The substantial growth includes a big rise in the level of payments owed by people now living overseas, more than doubling to $114m.

New Zealand University Students Association co-president Sophia Blair said it was not surprising that students with loans were heading overseas and letting the bills mount. “You can earn higher wages [overseas].”

[…]Total student loan debt had reached $10.2 billion and is predicted to grow by an average of $875m a year to more than $20b by 2022.

The report also showed about 39 per cent of students who left tertiary education with a loan did so without achieving a qualification.

About 8000 students with loans who left study in 2005 had nothing to show for it by 2007.

New Zealand, if I understand correctly is a fairly left-wing country, which probably subsidizes tuition and taxes income. So, students would be incentivized to game the system by taking out loans backed by the government, and then leaving to work abroad in more capitalist economies. Socialism encourages people to game the system and avoid taking responsibility for their own decisions.

UPDATE: New Zealand blogger Madeleine Flanagan wrote to me in an e-mail:

It’s old news, it has been the same way for years and years and that story comes out every year but as always it is interesting.

Your assessment is pretty spot on. In New Zealand student loans are pretty much available to anyone who applies for one. Acceptance at University or an alternative tertiary institution is not difficult, especially once you are over 20 as the institutions want your money – they get more funding the more students they have. Student loans are interest free and you do not have to begin repayments until you finish study. The state funds something like 75% of the tuition fees directly anyway so the loan is only for 25% of the actual cost. There are benefits available for living costs and if you don’t qualify for them you can borrow living costs and have them added to your student loan. So it is set up to make it easy to get into debt.

Being a fairly left-wing country there is a lot of regulation in the market place so of course you can pretty much always earn more overseas and once overseas the state cannot garnish your wages to get your student loan repayment.

The system has some fairly bad holes in it. For example, people who are being funded for Uni by they employer, like I was pre-accident, to study can take the cash for tuition fees from their employer, invest it and then take out an interest free student loan to pay their tuition fees. At the completion of study they then pay off the loan with the invested funds and pocket the interest – compliments of the taxpayer. Only students with cash coming from somewhere can do that as your student loan gets paid straight to the education provider apparently a lot of students with wealthy parents do this too.

As if this situation were not bad enough, organizations like New Zealand University Students Association (NZUSA), quoted below whinging about the level of pay rates in New Zealand , typically also whinge that education is not “free” anymore like it used to be when the politicians went to Uni! They argue that being educated to tertiary level benefits society so therefore society should pay for all of it (and have much higher wages).

New Zealand is crazy.

Madeleine and her husband Matt write at MandM blog.

Commentary

Dean of Harvard Medical School gives health care bill a failing grade

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Story from the Wall Street Journal, by the Dean of Harvard Medical School Jeffrey S. Flier.

Excerpt:

As the dean of Harvard Medical School I am frequently asked to comment on the health-reform debate. I’d give it a failing grade.

[…]Speeches and news reports can lead you to believe that proposed congressional legislation would tackle the problems of cost, access and quality. But that’s not true. The various bills do deal with access by expanding Medicaid and mandating subsidized insurance at substantial cost—and thus addresses an important social goal. However, there are no provisions to substantively control the growth of costs or raise the quality of care. So the overall effort will fail to qualify as reform.

In discussions with dozens of health-care leaders and economists, I find near unanimity of opinion that, whatever its shape, the final legislation that will emerge from Congress will markedly accelerate national health-care spending rather than restrain it. Likewise, nearly all agree that the legislation would do little or nothing to improve quality or change health-care’s dysfunctional delivery system. The system we have now promotes fragmented care and makes it more difficult than it should be to assess outcomes and patient satisfaction. The true costs of health care are disguised, competition based on price and quality are almost impossible, and patients lose their ability to be the ultimate judges of value.

Worse, currently proposed federal legislation would undermine any potential for real innovation in insurance and the provision of care. It would do so by overregulating the health-care system in the service of special interests such as insurance companies, hospitals, professional organizations and pharmaceutical companies, rather than the patients who should be our primary concern.

In effect, while the legislation would enhance access to insurance, the trade-off would be an accelerated crisis of health-care costs and perpetuation of the current dysfunctional system—now with many more participants. This will make an eventual solution even more difficult. Ultimately, our capacity to innovate and develop new therapies would suffer most of all.

In order to have an economy recover, you need people running government who actually understand health care and economics. My lunch-time book is Regina Hertzlinger’s “Who Killed Health Care?”. Regina teaches at Harvard University, as well. She talks about how we need to lower costs and improve quality by introduce elements of choice and competition. Her plan is similar to the Republican’s Patient’s Choice Act. Consumer-Driven health care is the right solution to the problem of rising health care costs. Obama’s plan just adds fuel to the fire.

The right way to reform health care without sacrificing liberty

Consumer-driven health care:

Health Care: Fostering Focus Factories
with Dr. Regina Hertzlinger
(8:46)

Choice, Competition Should Drive Health Care Reform
with Dr. Michael D. Tanner
(5:21)

The Republican Plan (“Patient Choice Act”) is consumer-driven:

Obama’s False Health Care Choice
with Rep. Paul Ryan
(10:39)

Ideas for Free-Market Health Care Reform
with Rep. Paul Ryan
(8:30)

What’s wrong with Obamacare, Medicare, RomneyCare and CanadaCare:

Competing with the Government
with Dr. Michael F. Cannon
(7:34)

Medicare: A Model for Reform?
with Dr. Michael D. Tanner
(4:34)

Lessons from Massachusetts Health Care Reform
with Dr. Michael D. Tanner
(4:18)

The Canadian Health Care Experience
with Sally C. Pipes
(7:45)

Puncturing the Myths of American Health Care
with Sally C. Pipes
(about 8 minutes)

News

Massive changes needed to avert demographic catastrophe in European Union

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Story from LifeSiteNews.

Excerpt:

According to the report by Norway’s Institute for Family Policies abortion rates in Britain have leaped by a third among unmarried teenage girls and abortion is helping to age the population of Europe. Without a massive shift to family-friendly policies, the pattern of increased abortion and increasingly aging population will inevitably lead to the collapse of social welfare benefits, and, ultimately, to the bankruptcy of Europe’s cradle-to-grave socialist welfare state.

Presented to the European Parliament on Wednesday, the report said that the situation of the family in Europe is “a desolate panorama.”

“Europe is plunged in an unprecedented demographic winter and has become an elderly continent, with a large birth deficit, fewer marriages and more of them broken, homes emptying.”

“The aging population, critical birth-rate, escalating abortions, the collapse of marriage, the explosion in family breakups and the emptying of homes are the main problems of Europeans,” the 2009 Report on the Evolution of the Family in Europe said.

[…]The dropping European birth rate, the report says, with its concomitant increasing health and pension costs, will lead to increases in public expenditure to care for the aging population and the eventual collapse of public revenues, leading finally to the bankruptcy of the welfare state. The average birth rate of EU countries is now 1.38 per woman, well below the replacement rate of 2.1 births per woman, even in relatively fertile countries like France.

Without a significant shift in family policies in all EU countries, the report predicts the result will be “catastrophic.” Starting in 2010, the population of Europe overall will begin to fall from 499 million to 472 million by 2050 and every third inhabitant will be over 65.

[…]Other indicators show the number of marriages, especially first marriages, is down and divorce rates are up. There are 1 in 4 fewer marriages than in 1980 and the marriage rate has fallen in 9 out 10 countries. One out of every 3 children (36.5 per cent) is born outside marriage. In some countries the fall in marriage rate has been around 50 per cent since 1983 and there are over one million divorces a year, the equivalent to one marital breakdown every 30 seconds.

You can take a look at the actual numbers here. It’s a mess. This should convince fiscal conservatives to support social conservatism. Abortion and the destruction of two-parent families imposes massive social costs on society, and it grows government to deal with the fallout. Government pay for all the social programs, welfare, police, jails, etc. But it also has to regulate broken families via the courts. It makes no sense to abandon morality and expect government to stay the same – it will have to grow.

Maybe we shouldn’t have let the secular socialist elites run things? Could it be that believers in traditional morality and small government were in the right? Could it be that there is a price to pay for believing in materialism and naturalism, and jettisoning morality for hedonism?