Economic definition and economic failure in a Washington Compost headline

[Ralph Wiggum]

Since y'all are smarter than the average bear, I'll leave it to you to figure out specific part of this what is patently wrong in the verbiage:

Debt ceiling deal: 5 takeaways on the economic impact

2. Incomes are likely to take a hit, as student loan payments would resume in September

Student loan repayments have been on hold since March 2020, costing the government roughly $5 billion a month in lost revenue. If passed, the debt agreement would require some 43 million Americans to resume payments in September, slightly earlier than expected.

As a result, households could see a $40 billion reduction in disposable income, estimates Joseph Brusuelas, chief economist for consulting firm RSM US. That could quickly blunt Americans’ spending power, especially at a time when many families are struggling to keep up with high inflation on necessities like food and gas.

“These aren’t trivial payments, so it can’t be good for demand,” said Claudia Sahm, founder of Sahm Consulting and a former Federal Reserve economist. “It means families will have less discretionary money in an environment where inflation is still high and costs are rising.”

This is all via the Dr. Evil owned Washington Post, so no link.

Have at it.

[Old n Grumpy]

If you borrowed the $$ you need to pay it back if it leaves you short tough shit..
There is no reason to put the burden on responsible people. 

[Eupher]

OK, Ralphie, I'll play.

I'm no finance whiz, but if the feds are losing $5B a month in lost revenue, how is it that those who have student loans that were TEMPORARILY relieved have to pony up $40B when the student loan payments resume in September?

Last time I checked, $5 billion does not equal $40 billion.

But yeah - if you signed up to borrow money, you assume the debt and the hit to your income as you pay it off. That's the way it works. If you took that money and spent it on your dumbass gender studies degree, you're a complete idiot.

[Old n Grumpy]

There is a commercial on tv about the “paper ceiling “ if you don’t have a degree you will be left behind. If a degree is so important why aren’t those who got one unable to pay their bills?

[Ralph Wiggum]

OK, Ralphie, I'll play.

I'm no finance whiz, but if the feds are losing $5B a month in lost revenue, how is it that those who have student loans that were TEMPORARILY relieved have to pony up $40B when the student loan payments resume in September?

Last time I checked, $5 billion does not equal $40 billion.

But yeah - if you signed up to borrow money, you assume the debt and the hit to your income as you pay it off. That's the way it works. If you took that money and spent it on your dumbass gender studies degree, you're a complete idiot.

This wasn't about the rampant stupidity of forgiving student loan debt, which is unfair to those taxpayers who either already paid off their student loans, never had them, or didn't go to college. We've already hashed this debacle out in different threads.

What I was referring to in the headline was "income". If a person is making $50k per year as a salary, being required to pay off one's loan obligations does NOT change the simple fact that your still earned $50k.  The person's expenses changed. If you wanted to get into the semantics of "gross" versus "net" income, well that's a different ballgame. Someone on salary who is paid $100k per year isn't taking that much home after payroll taxes, it'll usually be around 65%. Everyone has expenses of course, it depends on your obligations and spending habits. But to say that incomes are taking a hit is dishonest and disingenuous.

Was just aggravated regarding the terminology and semantics of a dolt writer who I'm 99% certain has never taken a class on business or economics. I'm a stickler that way. Not to mention that I know what words mean and try to use them properly, especially when it comes the finance and accounting.

[SVPete]

2. Incomes are likely to take a hit, as student loan payments would resume in September

How does paying off a debt decrease one's income? Are employers deducting loan payments from employees' paychecks?

[Muddling 2]

This wasn't about the rampant stupidity of forgiving student loan debt, which is unfair to those taxpayers who either already paid off their student loans, never had them, or didn't go to college. We've already hashed this debacle out in different threads.

What I was referring to in the headline was "income". If a person is making $50k per year as a salary, being required to pay off one's loan obligations does NOT change the simple fact that your still earned $50k.  The person's expenses changed. If you wanted to get into the semantics of "gross" versus "net" income, well that's a different ballgame. Someone on salary who is paid $100k per year isn't taking that much home after payroll taxes, it'll usually be around 65%. Everyone has expenses of course, it depends on your obligations and spending habits. But to say that incomes are taking a hit is dishonest and disingenuous.

Was just aggravated regarding the terminology and semantics of a dolt writer who I'm 99% certain has never taken a class on business or economics. I'm a stickler that way. Not to mention that I know what words mean and try to use them properly, especially when it comes the finance and accounting.

These are the same people who mangled the term "Entitlement Program" from a program from which one was entitled to draw (SSA, Medicare etc) based on paying in for a prescribed number of years to "Any Program that takes tax dollars from one group of people and doles it out to another".

[DefiantSix]

This wasn't about the rampant stupidity of forgiving student loan debt, which is unfair to those taxpayers who either already paid off their student loans, never had them, or didn't go to college. We've already hashed this debacle out in different threads.

What I was referring to in the headline was "income". If a person is making $50k per year as a salary, being required to pay off one's loan obligations does NOT change the simple fact that your still earned $50k.  The person's expenses changed. If you wanted to get into the semantics of "gross" versus "net" income, well that's a different ballgame. Someone on salary who is paid $100k per year isn't taking that much home after payroll taxes, it'll usually be around 65%. Everyone has expenses of course, it depends on your obligations and spending habits. But to say that incomes are taking a hit is dishonest and disingenuous.

Was just aggravated regarding the terminology and semantics of a dolt writer who I'm 99% certain has never taken a class on business or economics. I'm a stickler that way. Not to mention that I know what words mean and try to use them properly, especially when it comes the finance and accounting.

The writer is executing verbal slight of hand, with the intention of eliciting an emotional response from the reader. This is why s/h/it buries the elaboration of their use of the term "income" to the 3rd paragraph of the point:

...As a result, households could see a $40 billion reduction in disposable income, estimates Joseph Brusuelas, chief economist for consulting firm RSM US. That could quickly blunt Americans’ spending power, especially at a time when many families are struggling to keep up with high inflation on necessities like food and gas.

In reality, it isn't changing their disposable income either, simply no longer allowing undisciplined college-indoctrinated cretins to believe that their obligation will never come due.

As someone who walked out of looniversity with an Engineering degree and $0.00 in outstanding debt, my sympathy is noteworthy solely for its microscopic dimensions... 

[Eupher]

This wasn't about the rampant stupidity of forgiving student loan debt, which is unfair to those taxpayers who either already paid off their student loans, never had them, or didn't go to college. We've already hashed this debacle out in different threads.

What I was referring to in the headline was "income". If a person is making $50k per year as a salary, being required to pay off one's loan obligations does NOT change the simple fact that your still earned $50k.  The person's expenses changed. If you wanted to get into the semantics of "gross" versus "net" income, well that's a different ballgame. Someone on salary who is paid $100k per year isn't taking that much home after payroll taxes, it'll usually be around 65%. Everyone has expenses of course, it depends on your obligations and spending habits. But to say that incomes are taking a hit is dishonest and disingenuous.

Was just aggravated regarding the terminology and semantics of a dolt writer who I'm 99% certain has never taken a class on business or economics. I'm a stickler that way. Not to mention that I know what words mean and try to use them properly, especially when it comes the finance and accounting.

Gotcha, and don't disagree. But my point wasn't so much about the rampant stupidity of coddling college students and their mommies as it was simple math.

$5 billion does not equal $40 billion.

Or am I missing something? 

[SVPete]

Gotcha, and don't disagree. But my point wasn't so much about the rampant stupidity of coddling college students and their mommies as it was simple math.

$5 billion does not equal $40 billion.

Or am I missing something? 

WashPost "reporters" education included Common Core Math, .