The leftward and other blatherings of Span (now with Snaps!)

Monday, April 02, 2007

Proving your point through bludging

One thing that frustrates me immensely is the practice of criticising a system for allowing bludging that you yourself take advantage of.

Case in point, the frequent anecdotal attacks on the Student Loan Scheme (which I actually don't like) for "encouraging" students to draw down the living component and earn interest off it.*

For the sake of a few hundred dollars a year, a handful of people do this, but I suspect their motivation is more to wave two fingers in the general direction of a Government they hate rather than to actually make a really quite small return off taxpayers' money for their own use. And here's one such example of this almost completely pointless practice of acting immorally to somehow gain the moral high ground.

People like this give people like Bill English anecdotes to wave around in Parliament, despite the lack of hard data on abuse of the Student Loan Scheme. They perpetuate myths about the Scheme, including the one that you can still download big wads of cash and blow them on stupid things, because it seems impossible to most of the public that anyone* would have the financial discipline and sheer bloody-mindedness to draw down $150 of debt a week to put it in an interest bearing account and garner a few hundred dollars (if that) at the end of the year. Instead those who aren't familiar with the scheme assume that the old rules still apply, from early in the Scheme when you could phone up for dollops of electronic money and the loan booklets were full of pictures of surfboards and cars. And so public sympathy for students drops, and National and Act can continue largely unchallenged with their assertions that fees are not too high and allowances are not too rare.

Ultimately if Michael and his ilk want to do this then it's their choice, it's not illegal. But it's hardly the wisest of investment choices, and it's yet another example of how Rightwingedness seems to advocate greed as good.

* I remember when the Loan Scheme was still young enough to be around the $1B mark and the rumour all over the Shore was that rich kids parents' investment advisors were telling them all to borrow their fee money on the Scheme. The logic was that it would fall over because it was so highly unsustainable, and that way their kids would all get a free education. I have no idea if this was true, but I heard it enough times from different people (people completely unassociated with education campaigning) to wonder.
** In particular students, who are stereotyped as not being the most sensible of people when it comes to money. Actually I think this is an unfair characterisation, but it is a key part I believe of the fact that many people still think that you can borrow $1000s at a time on the Scheme, despite the fact that that hasn't been the case for a considerable number of years.


backin15 said...

Lockwood Smith argued, in the mid-90s, that students were borrowing to fund their overseas trips. I, along with many other student politicians argued that (a) it was a tiny minority and that (b) what they did with their debt was really their business... but, it was damn annoying to discover that Lockwood actually had postcards from some students... the kinda "thanks for the trip to Aspin, here's a shot of the black-run we did this morning" type of thing... very deflating to our otherwise indignant stand.

Span said...

Exactly. And there was never any proof that those people were more than a tiny minority, yet they became the mainstream perception of the way the scheme worked. Even with the changes made so that that can't happen, it still seems to be a widespread myth. Sigh.

Heine said...

The running joke at Otago was all the students who would use their loans and go for skiiing holidays and road trips in August.

I'm still boggled why when the loan amount was several billion less than it is now we had chaos caused by student protests, and yet now not even a whimper by NZUSA.