Budget Nomad: If There Were Still Debtors' Prisons

Saturday, March 16, 2013

If There Were Still Debtors' Prisons

I have a former student who married an American and moved to the US. Although she has graduated from Eötvös Loránd University with an M.A. degree in both American Studies and English, she had found job hunting as unsatisfying there as she did here. She wrote to me complaining about the low-level jobs she was qualified for and her increasing disillusionment with the American Dream. In her mind, her only alternative was to return to school for another M.A. from an American university, but in a different field. When in doubt stockpile degrees, it does not make it better, but it does delay the agony.

When she sent me the list of her university choices the only thing I could see were $$$. Europeans in general, but Hungarians in particular continually seem to believe I am lying about the cost of education in America. They also believe that all they need to do is apply for scholarships and they will then have a free ride to the end of the chosen degree program. More than a few have had their hopes dashed, tromped on, or pummeled after going to the counseling center at the Fulbright office seeking advice on admission procedures with financial aid thrown in. I feared for this former student. She was one of the brightest in her group and did write an exceptional thesis. Still, reality is a hard pill to swallow when it is not placed on your native tongue.

It was during this time that many CAUSE campaign petitions started circulating focused on reducing student debt by preventing lenders from overcharging fees, penalties, and interest. It was also about this time when a friend wrote asking for everyone to sign her personal petition. She found herself owing over $100,000 in student loan debt, not of her own, but her ex-husband. Back when the marriage was solid, they had combined their student loans to save on interest with the added benefit of income taxes. They were both gainfully employed at the time. When things went sour, eventually ending in divorce, she did not realize that she was still responsible for his debt because it was not stipulated in the divorce papers. She has always worked, he has not and isn’t now. Her salary is being garnished; she is raising their two daughters without child support.

Meanwhile, I have fought off debt collectors for my student debt for years now. It seems that I am one of the few in my doctoral program who did not qualify for special scholarships, grants, alimony, entitlement programs, or any other source for funding my education. At the time I took out the loans I fully anticipated being solidly employed with a satisfactory income if not extravagant, as a university instructor in Somewhere, USA. It did not turn out that way, so after pushing back the due date for the loans as much as was possible with deferments, it came time to start paying the piper.

The piper is really a nasty SOB, nothing like you see in children’s tales where he is represented as sweet and kind. This piper wanted monthly payments of $525 even when I pointed out that my monthly salary was equal to $641.27. Even that was only when the exchange rate was doing well, like it is at the time of this writing. At other times, it really takes a nosedive like stock in Apple. They wanted me to prove that I was basically indigent by US standards, but to do this I had to send in my last 3 years of tax returns. I had not filed US tax returns falling under the income level for needing to. Plus due to an agreement with the US, Hungary does not take out taxes for the first two years of employment in government funded schools, but they insisted on having them regardless. Letter after letter went unnoticed by their computers, which in turn spewed out more vile letters demanding my soul and cash.

Finally, they acquiesced to receiving 3 years’ worth of my monthly Hungarian salary reports. They wrote back complaining that these were not sufficient since they could not read them. No one thought of this when they asked? Is it my fault they don’t have a Hungarian on staff? We have gone round and round, but I send them a regular check each month via online banking. If I had to write a check and mail it, the temptation to write nasty notes in the memo section would be too appealing. If the federal government is not going to recognize my relationship with Ron, they don’t deserve any money pulled from his income. They get what I send them and to hell with them.

A couple of days ago, I received a letter from the agency; it showed they had added over $20,000 in penalties and over $3,000 in interest to the base feel of somewhere around $60,000 for a grand total of $87,000 plus. Will I ever move back to the US? No way, José. If I should happen to work there, they would garnish my wages taking the full monthly amount that they are now demanding: $750 a month.

Yet, I am not alone. According to Causes.com there are now 37 million Americans in student loan debt, more than the population of Canada. If they can bail out corrupt banks, they can forgive substantial amounts of student debt.