The Libertarian Republic has published a piece highlighting a Bloomberg Report regarding the amount of money that the U.S. Government pours into their mostly-failed effort to recover money that’s owed to them. The report is astounding and even though it’s chock full of a bunch of statistics and numbers, let’s try to break it down so that it’s crystal clear: that our politicians are not in the business of running an efficient and money-saving organization on our behalf, but of treating our taxpayer-funded efforts as an excuse to appear on an episode of “Politicians Gone Wild” on D.C. Spring Break, spending like drunken sailors in a red light district.
The U.S. government pays professional debt collecting agencies, on average, nearly 40 times the value of what they collect, according to joint research released Tuesday from the Consumer Financial Protections Bureau and government filings.
The federal government is annually dolling out an average of $1 billion to debt collectors to retrieve borrowers delinquent debt, Bloomberg reports. Of course, it is American taxpayers, not the government, that are shouldering this hefty sum.
Nearly 8 million Americans holding some $137 billion in federal student loans are at least 360 days delinquent on their payments. That figure is roughly equivalent to the number of people who lost their homes after the housing market collapse of 2007, according to The National Center for Policy Analysis. Another 3 million owing $88 billion are over a month late on their payments.
So, let’s see, par for the course, our beloved teenagers in government, are writing (pretty much) blank checks to debt collection services to recoup the costs of American citizens who are defaulting on their loans and such, to the tune of 40 times the amount of what they actually recover. In simple math, for every $1 they recover on these loans, they’re paying to these debt collectors $40. That makes TOTAL SENSE now, doesn’t it?
Let’s not forget that the debt collectors know this and fully exploit the teenage mentality of our politicians using mommy’s and daddy’s credit card (American Taxpayer Express…they don’t pay bills without it!). They pay out an average of $1B every year to these debt collectors. In ANY OTHER BUSINESS, using this business model, you would be in financial ruin! Hell, the bank wouldn’t even give you a loan for this type of business prospectus, would they? “Yes, I like to open up a business and pay out MUCH MORE than what I’m actually making…”
But here’s the kicker: they know there’s always that government welfare that they themselves can rely upon…the American taxpayer. They run out of money…”Relax! We’ll just raise the debt ceiling and the taxes! Problem solved!”
For a debtor to be considered in good standing under the government’s rehabilitation program, a borrower must make nine on-time payments of as little as $5 over the course of 10 months. Effectively, a borrower must cough up $45 over the course of 10 months. Even more troubling is the fact that over 40 percent of borrowers that go through reconciliation default again within three years, the Consumer Financial Protection Bureau reports.
The department has allocated $4.2 billion to debt collectors since 2013 alone.
So, as you can see, the problem is only going to worsen. As the population grows as well, so too will the number of U.S. Representatives in the House, because as most are aware, the number of representatives in a state determines the number of politicians sent to Washington. That means that, not only is there more money from the taxpayers with the higher population, but that for every single representative sent, they will also be followed by a posse of assistants and staffers.
great
Liberal thinking.
Not surprising. An elephant is a mouse built to government specifications!