Category: Words

Kevin Cullen of the Boston Globe Misses A Few Key Issues on Student Loans

Yesterday the Globe published an article by Kevin Cullen titled Ungrateful Sallie Mae, about a Marine Corpsman who died and left behind $100,000 or so of student loan debt. The Globe’s reporter says: “[His father] wrote to the lenders, asking that the debts be forgiven. Two wrote back, saying they would forgive the loans. The third, Sallie Mae, the government-created college loan provider that privatized its operations in 2004, refused.” The article goes on to portray Sallie Mae in a pretty negative light.

Since I work in the industry (please don’t construe this post as anything official coming from my employer), I immediately had questions. Key questions that would explain how something like that could happen. Questions the author should have investigated and did not. Notably, Cullen’s report was missing any explanation of what kinds of student loans were taken out, whether they had co-signers, and whether the deceased had life insurance.

If the article were actually going to inform anyone about the tragedy and how it happened, it would need to explain that there are two major kinds of student loans: Federal and private. Federal student loans are guaranteed by the government and are automatically forgiven in the event of the death of the borrower. It sounds like the first two loans, the ones forgiven by the lenders, were federal.

The other loan sounds like a private loan. Private student loans are not guaranteed by the government, and do not have as many protections as federal loans do. For most borrowers, they also require a co-signer, usually a parent. The contracts typically state that if for any reason (and I mean any) the borrower cannot or does not pay, the co-signer is on the hook for the loan. That’s how co-signing works, and why many financial advisers suggest that you avoid co-signing a loan for anyone if at all possible.

Now, this is still a horrible story, and the young man’s death is undoubtedly a tragedy. But the article fails to explain any of the background of how the wreckage left behind by the tragedy came to be.

It also fails to explain the existence of a whole system set up to pay your bills if you die. It’s called life insurance. In general, life insurance is provided all military personnel. I do not know if there are any exceptions and I do not know if the Lieutenant was one, because Cullen doesn’t even bother to ask about that.

Now, I’m no journalist, but even I can tell that if you want to write an article that gets beyond “wow, college is expensive and loans are hard to pay back,” you need to do things like consult experts and look up regulations. At the very least, you could consult Finaid.org. Sallie Mae presumably has PR flacks, but it doesn’t sound like Cullen asked them for a comment. He does say that the grieving father was unable to navigate Sallie Mae’s phone tree to get to a real human, but does not mention whether he himself tried to do so, or whether he tried their email customer support offering.

Is it budget cutbacks that prevent Kevin Cullen from doing any actual leg-work on his articles? Because really, there’s nothing to this piece except that it sucks to die and it sucks to borrow money and not be able to repay it, and that’s not actually news.

Airport News Shows: Ugh

Stuck in an airport last night I wound up watching former McCain spokesperson Nancy Pfotenhauer tell all kinds of stupid lies, grinning all the while. That smug rictus of hers just enraged me. How is she still accorded any respect? Why don’t the moderators call out her lies?

Then I tried to text my friends about how annoying it was, and my phone couldn’t spell “rictus.”

Direct Marketing Has Funny Words

There are some ugly words in the word of direct marketing, and I learned them last week.

Onsert, for example. It’s an object which is glued to the exterior of a magazine rather than being inserted between its pages. Or squinch analysis, which refers to balancing production cost and potential sales value of every square inch of a catalog. There are others, but I won’t horrify you.

Direct Marketing also full of weird, special definitions of things. For example, “Dimensional” means anything in a box or tube, while “flat” means not only flat, but also larger than normal envelopes. Envelopes don’t count as “flat” – they’re just envelopes.

And then there are the ugly facts. Things like the fact that all those advertising techniques you hate persist because they work. Or that the average turnover in a call center is 90% every 90 days.

Still, there’s some good stuff out there. I learned that Planned Parenthood has had a dramatic surge in donations recently, simply because Sarah Palin is practically doing their fund raising for them by this point. They barely have to send a letter, because the need for their services has been made so real by Palin’s candidacy.

We saw a prize-winning mailer was an oversized postcard with a small hole in the middle. The front side said “Can you fit your arm through this hole?” On the back: “A child dying of starvation can.” It was a mailer from Doctors Without Borders, raising money to bring medical care and food to children in Darfur. How many lives did they save with that campaign?

Was it more than our class presenter killed by running a series of Virginia Slims dimensional promos in the 80s?

There’s a lot of ugly business out there, and not all of it is dimensional tobacco promos and the hot new catalog from Landmines-R-Us. Some of it is collectibles.

Other things are just murky. We spent about twenty minutes examining the emotional appeal of a bank that had a multi-pronged campaign advertising home equity loans. Of course, many of those great loans are now in default. Here’s a compelling campaign for undergraduate credit cards… an area that combines irresponsible marketing with irresponsible lending and irresponsible spending to create financial nightmares for people in their twenties – not to mention plenty of opportunities for identity theft.

Still, it’s not the fault of the marketers if the credit approval standards drop, or if students rack up ten grand in credit card debt at 18% without really thinking about the interest payments (oh, they’re aware of them, they just ignore them.)

Is it?

Arguing about the end of “Edgar Sawtelle.”

As much as I try to stir debate on all kinds of topics (hello, ad-hominem attacks on Jeff Jacoby!) but the one thing that gets more people commenting here is “Edgar Sawtelle,” the Hamletesque tale of a rural Wisconsin family of dog breeders. So far, I’ve racked up thirty-nine comments. My usual average is somewhere just north of zero.