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12:57 PM on 08/09/13 
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EasySkankin
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Students loan rates to be tied to the market with caps
02:34 PM on 08/09/13 
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David87
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Undergraduates will now be able to borrow at a 3.9% rate for subsidized and unsubsidized loans, according to legislation that was negotiated in July.

I don't quite get this part...so my unsubsidized loans are actually going to be the same interest rate as my subsidized ones? If so, that'll be good for me...probably not so good for college students 10 years down the line that end up paying 7% interest rates.

My first loan from last school year was 3.4% for the subsidized, 6.8% for unsubsidized. I assume this means that unsubsidized will still be accruing interest as soon as you take out the loan, while the subsidized won't do so until after graduation?
06:24 PM on 08/09/13 
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Cereal_Killer
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How are birdman's finances doing?

well obamacare gets implimented soon, so i imagine hes somewhere between stealing toiletries and cleaning supplies from the bathroom at mcdonalds, and auctioning off his organs live over the internet.
06:26 PM on 08/09/13 
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David87
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Those oppressive tax hikes must be hitting him hard
07:50 AM on 08/10/13 
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Zeran
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let's end student loans and just use the money that would be spent on subsidizing them to make education tuition much more affordable.
01:31 AM on 08/12/13 
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EasySkankin
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I don't quite get this part...so my unsubsidized loans are actually going to be the same interest rate as my subsidized ones? If so, that'll be good for me...probably not so good for college students 10 years down the line that end up paying 7% interest rates.

My first loan from last school year was 3.4% for the subsidized, 6.8% for unsubsidized. I assume this means that unsubsidized will still be accruing interest as soon as you take out the loan, while the subsidized won't do so until after graduation?
Dunno if you're still wondering, but I'm pretty sure for indirect it depends on whether its for a grad or undergrad program. Undergrad, both direct and indirect will be the same. For grad students, the indirect will be the 10 year T-bill rate plus 3.4%. And yeah I'm pretty you're right the unsubsidized will accrue interest from the get go still.
01:33 AM on 08/12/13 
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EasySkankin
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let's end student loans and just use the money that would be spent on subsidizing them to make education tuition much more affordable.
I feel like this issue is so much like the healthcare one. Trying to tweak the current system to make it cheaper is going to be so goddamn complex that we should really just go the extra mile and socialize it. If only...
04:34 AM on 08/12/13 
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Zeran
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I feel like this issue is so much like the healthcare one. Trying to tweak the current system to make it cheaper is going to be so goddamn complex that we should really just go the extra mile and socialize it. If only...
it would never have the votes, especially in the senate. but it'd be nice.
12:14 PM on 08/12/13 
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llluminate
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Any financiers in this thread?
03:25 PM on 08/12/13 
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David87
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Dunno if you're still wondering, but I'm pretty sure for indirect it depends on whether its for a grad or undergrad program. Undergrad, both direct and indirect will be the same. For grad students, the indirect will be the 10 year T-bill rate plus 3.4%. And yeah I'm pretty you're right the unsubsidized will accrue interest from the get go still.

yeah I'm still an undergrad, so that's good news that the unsubsidized will be lower. Good for me, anyway. I feel bad for college students when interest rates start going up in a few years.

So I guess this is finance/economics related....One of the big things I always read about is barriers to entry for people starting businesses...and one of the ones brought up is the minimum wage. What would the liberals here think if the government figured out a law where start ups had a 1 year grace period where they could pay, say $2 below minimum wage? I don't know if it's possible, but say it was...I think at the very least it could give start ups a chance to see if they have a successful business, but on the other hand, you're getting probably a lot of temporary jobs at businesses that fail and/or can't stay open if they have to pay their workers more at the end of the year.
01:02 AM on 08/13/13 
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Cereal_Killer
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taking a class on behavorial economics on edX in october. so ill be in here then to act like i have an idea of what im talking about.
12:27 AM on 08/14/13 
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EasySkankin
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it would never have the votes, especially in the senate. but it'd be nice.


Till then the biggest obstacle is facing up to the pharmaceutical companies, and standardizing the price system somewhat so hospitals can't write themselves a blank check with charge masters.
yeah I'm still an undergrad, so that's good news that the unsubsidized will be lower. Good for me, anyway. I feel bad for college students when interest rates start going up in a few years.

So I guess this is finance/economics related....One of the big things I always read about is barriers to entry for people starting businesses...and one of the ones brought up is the minimum wage. What would the liberals here think if the government figured out a law where start ups had a 1 year grace period where they could pay, say $2 below minimum wage? I don't know if it's possible, but say it was...I think at the very least it could give start ups a chance to see if they have a successful business, but on the other hand, you're getting probably a lot of temporary jobs at businesses that fail and/or can't stay open if they have to pay their workers more at the end of the year.
Exactly. Now is probably the best time, so I'm jumping on the opportunity.

The issue would be trying to compete for workers against other businesses with the minimum wage. You could probably have the gov't subsidize X% of labor costs for say the first 5 years, which IIRC is the make-it-or-break-it mark for startups. Kind of an interesting alternative to relying on the private sector for cheaper credit.
taking a class on behavorial economics on edX in october. so ill be in here then to act like i have an idea of what im talking about.
Behavioral economics is the shit! Can't get enough of it.
12:13 PM on 09/06/13 
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EasySkankin
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Anybody read up on MMT? One of my latest obsessions. Essentially honing in on the simple fact that the gov't is the single issuer of that which it accepts as taxes. Gov't deficits are absolutely necessary for economic growth, and whenever the government pursues a balanced account the economy crashes (like in the late 90's). The associated theories existed back in Keynes' day as chartalism, but today is a bit fringe for some reason, being hashed out mostly on blogs of economists.

Primers
Bill Mitchell reppin' Australia
Mosler's blog, the unofficial talking head of MMT

Dean Baker also has some interesting write ups on it. Lots of food for thought.

Also, The Toaster Project. Building off the wonderful and influential "I, Pencil" paper, a man attempts to build a toaster from scratch. This is his TED talk on it.
12:40 PM on 09/06/13 
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open mind
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Anybody read up on MMT? One of my latest obsessions. Essentially honing in on the simple fact that the gov't is the single issuer of that which it accepts as taxes. Gov't deficits are absolutely necessary for economic growth, and whenever the government pursues a balanced account the economy crashes (like in the late 90's). The associated theories existed back in Keynes' day as chartalism, but today is a bit fringe for some reason, being hashed out mostly on blogs of economists.

Primers
Bill Mitchell reppin' Australia
Mosler's blog, the unofficial talking head of MMT

Dean Baker also has some interesting write ups on it. Lots of food for thought.

Also, The Toaster Project. Building off the wonderful and influential "I, Pencil" paper, a man attempts to build a toaster from scratch. This is his TED talk on it.
Not related to anything in this post, but you said the other day that the IMF and the world bank have changed in the last ten years, and that you'd post something that illustrates those changes in here.

Genuinely curious to learn how/if their policies have changed.
01:25 PM on 12/31/13 
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Nuns On A Bus
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Quote:
[From] the person who wrote the chapter in the OECD report that is the basis of these figures: It is part of a report on the distribution of income to households, so it doesn’t include taxes that are not directly paid by households, since these are not included in income surveys....[T]he table also calculates the distribution of taxes for the household as whole after adjusting for the number of people in the household, so it will differ from data calculated on income tax returns which are not adjusted for household size.
As others have pointed out this measure includes all direct taxes on individuals so it includes income taxes and employee social security contributions, but not employer payroll taxes. It also doesn’t include sales taxes, but these are much heavier in most other OECD countries, and not as progressive as direct taxes, so if you added indirect taxes in through some sort of modelling it is almost certain that the USA would still have the most progressive overall tax system.
However, as the OECD report points out, progressivity is not the same as redistribution. Progressivity measures how the distribution of the tax burden is shared, while redistribution measures how much the tax system reduces inequality. Redistribution is influenced both by the progressivity of taxes and the level of taxes collected.
In fact, the US system of direct taxes actually reduces inequality more than any other country as well. But overall, the USA reduces inequality a lot less than most other countries, because the other thing that you need to take into account is what taxes get spent on.
Now the US system of social security and cash benefits reduces inequality by less than any other OECD country except Korea. The US social security system is marginally less progressive then the OECD average, but the level of spending is very low – only Mexico and Korea spend less in the OECD.
So while the US tax system is progressive and reduces inequality, the US welfare state is much less effective at reducing inequality. And because the US has a very unequal distribution of income from capital and a much wider wage distribution than many other OECD countries, it ends up as a relatively unequal country after taxes and benefits.
If you look at Nordic countries, they all have much less progressive tax systems than the USA, but they collect a lot more in taxes (including in VAT). They then spend this much higher tax revenue on social security and services, and it is this side of the equation that is most important in reducing inequality.
So the implication is not that the USA either needs to increase or reduce the progressivity of the tax system. If you want to reduce inequality, you need to increase the level of taxes collected and spend it more effectively.



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