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Interest on student loans is cruel and unusual punishment

According to Statistics Canada, well over half of Canadians who attend a post-secondary institution draw on student loans. The average debt load hovers around $19,000 with loans of $25,000 or more increasing to 27 per cent between 1995 and 2005 and those with $50,000 or more tripling in that same time period to 6 per cent.

The Canadian Federation of Students contends that 425,000 students use student loans each year. When loan repayment is considered alongside loan disbursement, overall student debt increases by one million dollars a day. And, according to CFS, without the inclusion of private bank loans, student loan debt currently sits at $15 billion nationwide.

Student loans are magnificent things. They’ve provided a way for students from low-income families to have access to university and college, have shown to increase the number of women attending post-secondary education, and indebted an entire generation to a country that cares more about cushioning the settled than encouraging the anxious.

The scheme that Canada and its cronie provinces has set up is worthy of the Don’s praise. It’s the perfect shark loan. It has the ideal vig. First, hand out thousands upon thousands of dollars to young people fresh out of high school in large lump sums. Second, let them think everything is all good for four to five years. Then, once they are in their most tenuous situation, send the dogs after them. Or, student loan repayment.

As these naive, debt-ridden, and ignorant borrowers wallow in the daily doldrums of Starbucks and part-time careers, charge them interest like crazy. Like, somewhere around 5 per cent plus prime. It may not seem like a lot, but be patient. Let Revenue Canada practice their hand at collections once those loans go into default and not a single well-educated youth will see a GST or tax return cheque again.

And here’s the beauty of it all: if they don’t default on their loan and actually pay it back, the nation still makes even more money. College and university educated youth, overall, persistently reach higher tax brackets than those with only a high school degree. So, you get a youth who pays back a $40,000 student loan. On that, they’ll pay in the vicinity of $12,000 in interest depending on their terms (monthly payments, length of repayment period). And then, once you get $12,000, Canada still gets to claw way more tax money than they would’ve been able to if that person hadn’t gone to school.

Take on a huge debt load so you can pay a tax to pay more tax.

That’s exactly what student loan interest is: a tax. There isn’t anything wrong with tax. My kid goes to a public school. I walk on public sidewalks to get him there. Plenty a student has gotten their stomach pumped at 4 a.m. on the public’s dime. Tax is great.

Tax isn’t so great when we use it to prey on our youngest. There are two terrifying points in life before 29: the day you realize you’ve hit puberty and the day you get your notification of student loan repayment. That notice comes in the mail telling you that for the next seven to 15 years you should be paying $300 to $500 a month.

The figure settles in. You think about it all day. If you’re me, you go through the five stages of grief: denial, anger, bargaining, depression and then acceptance. That final stage is the acceptance that I will never be able to do this.

Never be able to because a corrupt corporate world, an ignorant government and an entitled generation would prefer to rely on us working 60 hours a week at minimum wage to pay off our debts and carry the nation into the future. At this rate, a whole lot of us will be, like me, dead by 52 (that’s what my BuzzFeed quiz told me).

And so we’re entitled. We think we deserve an education. We insist that careers and jobs should come running to us the day we walk off that stage with our diploma.

Excuse me: we work our damned asses off and get the crumbs from the boardroom table. The current generation of youth, at least the ones I meet and talk to frequently, are not entitled, lazy or lethargic. There are an uncountable number of us who get the grades, work the jobs, gain the experience and wheel ourselves away for a meagre $10 an hour. While we subsist on substandard resources, we have student loans hounding us. We work hard; we get nothing.

Cut student loan interest. Completely eliminate it at both the federal and provincial levels. There is no need for us to carry a debt that is ever increasing while we try to begin our lives. The Canadian Charter clearly states in section 12 that citizens have the right to be free from cruel and unusual punishment. Interest on student loans is cruel and unusual punishment. If you don’t believe me, you can carry my $40,000 in student loans for the next 15 years. Canada punishes its youth for getting an education. Canada, leave students alone.

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