[hackererror404]

Might be an unpopular opinion... but this is exactly why we shouldn't do student loan debt forgiveness. The root core of the issue wouldn't at all be addressed and it would actually be a signal to universities and students alike, that Universities can charge more, and students can continue to take out larger loans because... they might be forgiven at some future point in time.

[pdabbadabba]

I reluctantly agree--unless the forgiveness is coupled with new laws and regulations that substantially reform the system (perhaps by eliminating the federally subsidized student loan system altogether, and restoring the more generous grant system of yore).

If we do nothing to change the system, what are new college applicants going to think? Either they'll have to pay back their loans and, compared to those who wend before, get totally screwed. Or borrow with the belief that the debt will eventually be forgiven. Neither are good.

And, FWIW, I have a boat load of student-loan debt that I would absolutely love to have forgiven. But it's a bad idea unless the White House and congress are able to address the root of the problem.

[nonethewiser]

> If we do nothing to change the system, what are new college applicants going to think? Either they'll have to pay back their loans and, compared to those who wend before, get totally screwed.

EDIT: I misread your comment. Please disregard.

They got screwed when they took the loan out, not when they pay it back. The terms never changed, people just realize they made a bad decision. Sometimes people argue they cant actually consent to the loan in which case we should just cease the loans immediately.

Part of the puzzle is rebuking this sort of logic: "Education is important. Having a bachelors degree is practically required. Therefor a loan is worth it." Without any qualifiers. This suggests the degree job prospects and loan amount don't matter. They do. If education is expensive enough, it's just not worth it.

[memish]

Student debt is mostly held by the richer half of the US population. Serious question: would it do more good if instead of giving money to people with student debt, you gave money to people without it?

The first test of a potential policy is whether it's better than doing exactly the opposite. If you can't even prove that, it's probably not a good policy.

https://twitter.com/paulg/status/1521112550770946048

[lapcat]

Income is not wealth. Especially when you factor in student loan debt! You can make a higher income than another person but still be poorer than them because of debt.

Also, income can change a lot from year to year. My income certain has. If the economy goes to pot, suddenly a lot of people with higher income will become unemployed. And the years you spend in school are typically very low or no income, so you're not building any wealth during those years. And if you go to graduate school, it's even more years of low to no income.

[sevenf0ur]

A college graduate will earn $900,000 more than a non-college graduate over their lifetime.

> You can make a higher income than another person but still be poorer than them because of debt.

Maybe we should focus our money on making college costs more affordable rather than forgiving loans and signaling to universities and students that it's safe to take on more debt?

[lapcat]

> A college graduate will earn $900,000 more than a non-college graduate over their lifetime.

A male college graduate, on average. https://www.ssa.gov/policy/docs/research-summaries/education...

"Men with bachelor's degrees earn approximately $900,000 more in median lifetime earnings than high school graduates. Women with bachelor's degrees earn $630,000 more. Men with graduate degrees earn $1.5 million more in median lifetime earnings than high school graduates. Women with graduate degrees earn $1.1 million more."

Of course these are just averages. There's no guarantee that any given person will earn even a penny more. Not to mention that not everyone who goes to college even finishes their degree, but they accumulate the debt regardless.

> Maybe we should focus our money on making college costs more affordable rather than forgiving loans

Why not both?

The thing is, the people who make a lot of money after college are able to pay off their debt. The real problem is the people who get stuck with debt for decades, unable to pay it off. It's a lifetime burden. Senior citizens are a very fast growing group of student loan debtors.

I don't necessarily believe that you should forgive student loan debt the minute someone walks out of graduation. But what about decades later?

Anyway, it's important to remember that these lifetime earnings numbers don't include college costs. You have to subtract those. Unless your parents pay for your college, in which case you have no student loan debt.

[suture]

A large percent of students never get a degree. Here’s the best statistics that I could find. It talks about 6 year graduation rates but I think a large percent of those who don’t graduate within 6 years never graduate.

https://nces.ed.gov/FastFacts/display.asp?id=40

[sevenf0ur]

> Why not both?

Because forgiving loans is a moral hazard. It signals to new college students that they can take out more debt and it signals to universities that they can raise tuition.

[lapcat]

Saddling people with a lifetime of student loan debt is a moral hazard that has already occurred. Moreover, college students are already taking out more debt, and universities are already raising tuition, despite the lack of forgiveness.

Would a one-time forgiveness cause an increase in college costs? I don't know, maybe? And if it did, by how much? I don't know, do you? Maybe the problem needs to get worse in order to put pressure on Congress to finally address it comprehensively. And if Congress still refuses to address the problem despite its getting worse, then you can no longer argue that we need to wait for a comprehensive solution, because that's not coming. Perhaps the occasional forgiveness event is the best and only thing we can do in the face of persistent gridlock. I hope not, but...

[bumby]

I'm not saying you hold this opinion, but policy-makers seem to have little issue with moral hazard when it comes to bailing out "too big to fail" corporations. I get the moral hazard argument, but if it's truly a first-principle it should probably be applied more consistently.

[gedy]

Yes I went to a cheap state school that I could afford. I'm from a modest background and it didn't occur to me I could borrow beyond my means and go to a nicer school.

I certainly don't feel student loan forgiveness is "fair" in that circumstance!

[lapcat]

> Yes I went to a cheap state school that I could afford.

The state school prices have gone way up too. It's possible that the state school you could afford back then would no longer be affordable now.

(By the way, I had to go to a state school too instead of a nicer school that accepted me, because of money. And yet, I still accumulated student loan debt! Because college is pretty expensive no matter what.)

[charwalker]

Nowadays 'affording' a 'cheap' state school is guessing if you can walk away with 20-50k of debt vs 50-150k. My younger brother had solid scholarships and still walked out with 25k. I graduated in 3 years and luckily my parents covered the last tuition check and I still had 15k.

At this point I've paid my debts and still welcome relief for students who didn't have the same opportunities as me.

There is no 'cheap' 4 year school anymore. Costs can be mitigated by going to a Community College for an associates/first 2 years then bridge that into a 4 year program but if you want to go for research, engineering, or many other more dedicated programs then being at the 4 year school all 4 years leads to many more connections and opportunities that some feel are worth the cost.

Borrowing beyond ones means isn't always fully understood by a group of 17-18 year olds, especially those who may be first generation college students or from school districts that have spent 2+ decades now losing resources for educating students on college options in order to focus on the kids failing out. For example, many college apps I completed in 2011 needed a letter of rec from my counselor who I had talked to once as a sophomore but spent most of his time working with students on the edge of failing or dropping out. It's archaic just like how the US college system operates as a capitalists dream and not a public service.

In terms of fair, well policy hasn't been fair in a long time either. The 2017 tax bill raised my taxes and pushed a trillion plus surplus back to the wealthy - a much worse outcome for all then cancelling student debt without a deeper plan. It may not seem "fair" to you but that doesn't make it bad policy.

[horsawlarway]

Ignore fair - How does this debt forgiveness address any of the systemic issues you've pointed out?

Colleges will still be just as expensive. The next round of student signing up now still has all the same burdens and obligations, the same disadvantages understanding the borrowing they're doing.

Nothing is getting fixed. You're just handing a one-time stimulus to recent college grads. And don't take me wrong - I would also have preferred a stimulus for recent college grads instead of the insanity that was Trump's tax cuts for the wealthy. But that's like picking between two wormy apples.

I really don't want a payout for EITHER of those groups! - I want the systemic issues around pricing for education to be addressed.

So if "debt forgiveness" also includes plans for something like universal access to college, or a standardized loan process through the federal government, or (perhaps most useful of all) the simple ability to discharge education debt through bankruptcy.... then sign me up.

If it just means handing money to the children of already mostly well-off folks, as a one-time political courtship to win the next presidential election... Then count me out. I think it's a bad idea.

[dragonwriter]

> Student debt is mostly held by the richer half of the US population

It's mostly held by the federal government.

It's mostly owed by the richer half, but that's misleading when it comes to impact.

Sure, households in the bottom half of the top quintile have twice the average student loan debt of those in the bottom quintile, they also have more than 10 times the income. The average student debt in the bottom quintile ($25,030) is about the upper income limit ($27Kish as of 2020) of the bottom quintile, while the average in the bottom half of the top quintile (80-89th percentile, $51,380) is a little.more than 1/3 the lower limit ($143K in 2020) of the top quintile. (And the upper half of the top income quintile actually has a lower average student debt that the bottom half, or the whole of the next highest income quintile, not just a lower average student debt to income ratio.)

The share of households with any student debt and the average household student debt-to-income ratio decreases consistently with household income.

See, https://www.businessinsider.com/personal-finance/average-stu... and https://www.taxpolicycenter.org/statistics/household-income-...

EDIT:

To directly answer your question:

> Serious question: would it do more good if instead of giving money to people with student debt, you gave money to people without it?

Would it do more good to relieve 75% of bottom-income-quintile households (student debt relief) or 25% (anti student debt relief)? Clearly the former.

[lapcat]

> this is exactly why we shouldn't do student loan debt forgiveness. The root core of the issue wouldn't at all be addressed

This is a false dichotomy. The root core of the issue should be addressed. However, that would require an act of Congress, whereas federal student loan forgiveness can be accomplished immediately via executive action. This is why people are calling for it now, because it can be done right now. Also, the President promised to do so multiple times during his campaign.

> Universities can charge more, and students can continue to take out larger loans

Universities are already charging more, and students are continuing to take out larger loans despite the lack of forgiveness.

[BitwiseFool]

>"However, that would require an act of Congress, whereas federal student loan forgiveness can be accomplished immediately via executive action. This is why people are calling for it now, because it can be done right now. Also, the President promised to do so multiple times during his campaign."

I can't be the only one who feels like this is simply 'buying votes' in an attempt to try and salvage some seats for the upcoming midterms. And, of course the people with debt want the debt forgiven unilaterally and post-haste, so it makes sense they're clamoring for it. In a democracy, who turns down free money?

[mcv]

By that argument, everything is "buying votes". There are far more blatant examples of vote buying, like creating jobs in the production of weapon systems for the military, tax cuts for specific groups (mostly the rich, though that's more "buying campaign donations"), and plenty of other examples.

The fact of the matter is that these loans are unsustainable. They saddle people with life-long debt that they can never get rid of, dooming them to a life of poverty because of a choice they made when they were young, which everybody at the time told them was the right choice.

That particular debt forgiveness is simply the right thing to do. It will free a lot of people from poverty.

But clearly there are also measures necessary to prevent this from happening again, like a reasonable maximum to how much can be lend.

[wand3r]

The examples you gave are not as direct. This is a direct stimulus that can easily be attributed from the government to an individual. In some cases, as you mentioned, there are political reasons that are also suspect and stupid in my opinion. However, this example is extremely simple and easily attributable as there isn’t some 3rd party hiring people or some number of dollars you get to keep in your bank account in the future.

I would prefer that the change be that loans can be discharged in bankruptcy instead of this one off forgiveness.

[mcv]

I think the other examples are far more blatant. Politicians fund the military by far more than the military needs, to the point that the military doesn't even know what to do with it, but there's always conditions that specific military or NASA projects take place in specific states or districts for specific politicians. The tax cuts for donations are even worse. And neither of those are solving a specific problem, which is definitely the case with the crippling student loans.

That said, I agree with you on bankruptcy being a better idea. From what I understand, these loans are harder if not impossible to get rid of through bankruptcy than other loans, despite being far more crippling.

In general, I'd like a rule that all interest-carrying loans must be able to be eliminated through bankruptcy. Only interest-free loans should be exempt. Also: a cap on student loans to discourage excessive tuition. Tuition is just insane (and where is that money going? I hear plenty of younger professors are struggling too).

[wand3r]

Yeah, I think we agree. The military spending is absurd and also extremely wasteful. However, I don’t think it is “buying votes”. Its more akin to this terrible system where senators pork bills and make trades. Paying people (or forgiving a big debt) directly before an election is buying votes. The other examples you said are just political ineptitude, horse trading and a broken governmental system.

My first pass on fixing education is that we should remove the non-discharge of student loan debt. Gen-Z could boycott this system by declaring bankruptcy immediately after graduation which would have relatively minimal affects on their lives relative to the debt and schools would be forced to lower costs

[nonameiguess]

It doesn't seem that simple, given he won a primary in which all of the other candidates promised more money than he did.

[BitwiseFool]

I still have no idea how he actually managed to win the primary. None of the Democrats or Progressives I know in real life or online actually liked him. He was doing terribly and then all of the sudden he cinched the nomination in the span of two weeks. I sense there was a lot of back room power-broker deals going on and that was the real reason why so many of his competitors dropped out when they still had a good chance.

[techdmn]

The Democratic party seems to be a lot more competent, and try a lot harder, when they are combating progressives, as opposed to when they are combating the other party.

[pnutjam]

Alot of marginalized people were terrified of another term for the last doofus. They didn't want to rock the boat with anyone who was not center of the road and well established.

[BitwiseFool]

I feel like that would have been better reflected in Joe Biden's poll numbers in the races before South Carolina. He ultimately won, yes, and I don't doubt that plenty of people voted strategically but it genuinely seems like a switch was flipped when that South Carolina representative endorsed Joe Biden - his results became dramatically better after that.

[opwieurposiu]

He won the nomination because people thought he could beat Trump. This turned out to be correct. Not many dems loved him (see poor rally attendance), but nobody really hated him either and so they went with the least-worst option (where the worst option is Trump winning again).

[chitowneats]

Anyone know where I can get a $10k education loan immediately?

[colinmhayes]

I'm sure the university of Phoenix can hook you up

[lapcat]

> I can't be the only one who feels like this is "buying votes".

Votes are already bought by wealthy campaign contributors.

Anyway, aren't politicians supposed to help the public financially? If a politician campaigns on tax cuts, tax credits, and tax incentives, isn't that also "buying votes"? Which politician is not buying votes with their stated economic policies?

[BitwiseFool]

I sense there is a difference between passing policy which broadly affects future actions (tax rates, credits, etc.) and making a campaign promise to directly pay (or in this case forgive) a lump sum of money to a certain contingent of the electorate.

[suture]

The child tax credit would be an example of ‘buying votes’ too, right? What about promises to increase milk subsidies? Or promises to keep protecting the limber industry from competition from Canada? Aren’t all such things ‘buying votes’ as you put it?

I’m not an economist but I suspect that in a society with a strong welfare system, universal healthcare, and free higher education then wages wouldn’t have to be as high as they are in the U.S. for certain industries. I don’t claim that student debt forgiveness is the efficacious or even that it should be done. I do claim that it’s best to ‘buy’ votes by creating a society with strong social programs.

[BitwiseFool]

Yes, I do consider the child tax credit buying votes and I likewise consider farm subsidies vote buying as well. This situation, in particular, seems egregious because of the amount being proposed - $10,000 - and because the executive branch is planning to do it unilaterally. I would still disagree with the measure, but I wouldn't feel as strongly if this happened a result of a vote from Congress.

[nonethewiser]

> This is a false dichotomy. The root core of the issue should be addressed.

It's not a false dichotomy because he's saying the root cause would get worse if student loans were forgiven.

You can argue whether or not that's true, but the claim he's making is not a false dichotomy.

[sevenf0ur]

It's debatable that the President has the authority to forgive federal loans. Forgiving a small amount of debt for a more wealthier group of people without fixing the root of the problem is just selfish and bad policy. It's no wonder why the proposal is very unpopular.

[lapcat]

> It's no wonder why the proposal is very unpopular.

It's actually quite popular: https://www.forbes.com/sites/zackfriedman/2022/04/18/student...

[sevenf0ur]

> Fifth, 29% of respondents don’t want any student loans canceled, which is the single highest of any of the answer choices.

I might support 0% interest rates so I guess that might be considered canceling some student loans for all?

[pnutjam]

Thank you for the course in "how to lie with statistics": 64% of respondents collectively support at least some amount of student loan forgiveness.

So most people support.

[pyrophane]

I'd like to see student loan debt forgiven along with implementing a plan to address the cause of this ballooning debt. Unfortunately, this is the United States, and federal legislation on just about anything is currently impossible if there is any opportunity at all to turn it into a divisive issue. Even if the democrats managed to build a majority that would allow them to pass whatever they wanted, tackling a problem like this in a forward-looking way seems beyond them.

[nonethewiser]

> I'd like to see student loan debt forgiven along with implementing a plan to address the cause of this ballooning debt.

Forgiving debt incentivizes debt though. It's impossible to address the root cause and forgive the debt.

[pyrophane]

That's why I'm suggesting that forgiveness of any existing debt should be linked to a big policy change.

For example, make student load debt dischargeable in bankruptcy like any other debt, and at the same time impose tuition caps at state universities to make them affordable again.

[jaywalk]

Every problem that gets solved is one less thing to campaign on. And since we don't hold our politicians accountable, they can just campaign on the same things over and over and never do anything about them.

[kansface]

Debt forgiveness is indeed an extreme, perverse incentive. Capping federal aid seems unthinkable. Asking something of all of those grads (service) on behalf of forgiving their debt also seems unthinkable. Forgiving college loans is a wealth transfer to the highest earning cohort... I'm not in favor of a debt jubilee.

[dragonwriter]

> Might be an unpopular opinion... but this is exactly why we shouldn't do student loan debt forgiveness.

I mean, it should be an unpopular opinion that a claim that both misrepresents the basic processes and incentives involved and requires effect to precede cause by more than a decade is perceived as “exactly why we should“ do or not do anything, but unfortunately it's actually a very popular opinion in this case.

(To the extent there is a real argument—and this one is not it—for federal student lending being a cost driver for education, that would be a good reason why debt forgiveness, if done, should be accompanied by lending reform to correct the problem going forward; of course, even without it being a cost driver, any argument for debt forgiveness is itself an argument for lending reform preventing the problem addressed by forgiveness from recurring.)

[vsareto]

With free universities, they wouldn't have to charge students anything.

[lamontcg]

And the government would then cap the amount that universities get per student, and it would allow poor people to go to college as well. Everyone winds up paying tuition via taxes over time.

[weberer]

Poor people already go to college. You don't have to pay anything up front. Its entirely debt-based.

[drewcoo]

If we were dealing with the victims of a school shooting, first we'd make sure none of them were going to bleed out. Then they'd be prioritized for dealing with their root cause injuries.

We can apply similar tactics to these school financial injuries. We don't need to choose one or the other.

And the core problem with people taking on debt to pay for college in the US is individual people having to pay for college, unlike many other countries. How much it costs is a secondary issue. If it can cost anything, market forces will boost the price until it passes a fairness threshold.

[Aunche]

Providing emergency aid to shooting victims doesn't incentivize more school shooters. If anything, it's a disincentive because it counteracts their goal. By contrast, forgiving student loans incentivizes more people to take loans, which in turn allows colleges to raise tuition prices.

[nonethewiser]

> If we were dealing with the victims of a school shooting, first we'd make sure none of them were going to bleed out.

Well... no. Obviously stopping the shooter is the top priority.

Beyond that, it depends on how many people are there to solve the problem and how many victims there are. Everything beyond whats required to stop the shooter would attend to the wounded.