6125

Does it say the president can forgive loans without any strings attached? It’s nice to quote headlines and statements, but these laws usually have a lot of language regarding when and where and how.

6126

If we get student loans forgiven what happens after. Is all college going to be free or will loans just start back up

6127

If he can’t, waht are they going to do, impeach and remove him for it?

If I was President, I’d just do it and dare Congress to impeach me over it if the court says no. Then I’d stump speech telling young folks if they don’t keep me in office they’ll be put back into debt…

6128

This is an issue Vice President Harris has been closely focused on, and one we both care deeply about.

I wonder if he’s planning to give Harris all the credit for this some time in the future as a political move?

Like a “VP Harris and I have been talking about this issue for months, and she has convinced me that for the good of the country we need to forgive student debt, so I am going to issue executive order XXXX…”

As a way to bolster her and boost election turnout?

6129

My position is that if he wants to “forgive” loans but not FORGIVE loans, instead just set a maximum limit on the amount a manditory monthly payment can be (hell, make it $0 if you want) but leave the loan on the record. You can optionally choose to pay more if you wish. Then, in conjunction, stop offering loans. Double Pell instead.

That way, there’s no sudden ding on federal revenues all at once, students stop getting into debt, colleges have to figure out how to become affordable again, and people’s debt goes away when they die. But because it sits on their record, it has the same effect it currently has in other ways (for example, showing up as debt when you try to get a mortgage, or whatever.) Note this last bit is just a sop to throw to the conservatives–“See, they still owe it, it is still their cross to bear!”

6130

There are a few main issues that I think are important.

  • Student Loan Forgiveness isn’t 100% universally popular with the American Public, so although you might win some votes, you will also lose others. Every president must balance that.
  • Student Loan Forgiveness is most popular on Reddit and among groups that are least likely to vote, so basically you are buying the fewest votes possible for the cost.
  • Student Loan Forgiveness targets the groups of Americans that are most likely to do well in our society. Basically, it’s like the giveaway on Mortgage Interest. If you are in a good enough place to afford it in the first place, the government will reward you with more.

Now, I do think that Loan Interest on Student loans is insane. I think, we as a country can afford to zero that out, so that people can actually pay down their loans. That gives a lot of people the break they need I think.

I also think we charge too high a premium on college education, so if we tackled that, I would be fine with student loan interests handled at the same time.

But, as @Haavok1, it kind of puts you in a bind if you forgive student loans. Do you do it all the time? Every couple of years when the underclasses get angry? Or only do it when we have a pandemic?

6131

There is zero chance the conservative press wouldn’t run your plan as “Biden eliminates all student debt payments”.

6132

Oh man I’d be totally happy with that as well.

6133

Personally, I think at best he forgives like 10k of debt and lowers interest rates. But at this point I think we get nothing past this last delay.

6134

I think a lot of people would. And heck, if Student Loan Forgiveness does become a thing, I’ve got 60,000 in loans that I would love to get forgiven (although, I took a Government Job exactly so I wouldn’t have to worry about it). My wife has another 25,000.

So, I’m happy to take Student Loan Forgiveness if it comes, but I really think you can’t do it without first fixing higher education in the US so that everyone gets a chance at going to school. There are so many people that never went to school because it was too pricey, and won’t see a penny of that forgiveness, while Doctors and Lawyers and MBAs will. That just annoys me.

But in the meantime, lower interest rate and 10,000. That seems so reasonable compared to 50,000.

And you could argue (rightfully) that the 10,000 is due to the pandemic. That people have lost 10,000 in earnings for payments on loans.

6135

I’m not a fan of blanket student loan forgiveness, but it’d be totally down with the government loaning money for post graduate education at 0% interest.

Then we need to address why college is so expensive in the first place.

6136

Complete agree. Addressing climate change is something that really should be done by the Federal government, any state, local or private efforts are sub-optimal compared to having a federal road map. Addressing climate change, like infrastructure is something that benefits everyone. Even the folks who don’t believe in climate change.

In contrast, virtually every other BBB program is a form of transfer payment, robbing Peter to pay Paul. Child tax credit, child care, elderly care, maternity leave, forgiving student loans, job training etc.

Now if the question was should we raise taxes on the top 20% to help this group. I’d generally say yes.
The reality is there is no political will to raise taxes on the 20%, and not even much political will to raise taxes on the top 1%.
So for me and many moderates the question is should we borrow from future generations, in the face of rising interest rates to help a specific group? For me the answer ranges from a tepid yes, to hell no in the case of student loans.

6137

The terribly-decided National Federation of Independent Business v. Sebelius says hi ;-)

I would, if I had to, settle for allowing for student loan debt to be dischargeable in bankruptcy.

6138

I’m reading the PolitiFact article you posted.

This is basically the moral hazard argument that always gets applied to the poor but never to the rich.

Also, I won’t say that eliminating up to $10k in student debt won’t make any difference to those with student debt, but it won’t make very much difference to many people with student debt. Most will still be facing an amount they can’t pay back anytime soon, and the difference in monthly payments isn’t going to be huge. The median student debt is $37k.

6139

The article gives only a brief quote and not anything close to a whole document and follows up in the second paragraph saying “However, experts disagree on whether the president can authorize widespread debt cancellation through an executive order. There’s enough of a legal question that any move by the president would likely prompt litigation, experts said.”

It’s not a moral hazard argument, it’s about fixing a situation, instead of creating multiple ongoing crises.
What are the requirements for forgiving loans? When do you do it? How often? Is it only done when the president in power slips in the polls or right before the midterms?
Should I push my kids into the most expensive college possible, gambling that some other administration will also forgive loans?

6140

There is a problem though, the degree to which the student loan situation has created a massive drag on the younger generation. I do not think your generation really fully understands the impact this has had, and how much this has had a massive effect on the macro level life of Millenials and younger.

Why are people getting married later/ not at all? Delaying having kids, or forgoing it completely? Why is home ownership so low, and often unattainable? What is the cost of college, how many are going to college, and what are they getting paid after college? The reality is that a job that required no degree when you entered the workforce now requires a college degree and pays less than your generation got.

The reality is the cost of college is a huge drag on the development and prospects of entire generations, and is a significant issue. Especially when many of my cohort are priced out of the housing market entirely in many places.

Now the reality is it would be much better to address the root cause, the cost of education and its accelerating cost increases. That’s the fundamental issue that needs changing. But the reality is that in the absence of student loan debt it would free up many towards other more productive economic activities. If, as many economists argue, the Millenial generation not getting married, having kids, and buying houses is creating a demographc crunch or creating drag on the economy, then actions that would accelerate those behaviors is long term a good thing. Arguably cutting some amount of student loan debt would accomplish this.

Which is to say there is a good logic in making changes to fix what is wrong with higher education, especially since it is more and more mandatory for new entrants to the work force. There is also a need to address how many jobs that used to not require degrees do, and how they pay less than before. It is a significant issue. The loan forgivness is treating a symptom. It has some benefits, but doesn’t fundamentally fix things.

As for those of my generation and younger who forgo college and don’t have loans? The problem is addressing the causes of why they did not, and their prospects. There is truth that those in my generation most left behind by the cost of college, those who did not go for financial reasons, are left out completely. But there is no easy fix there, as we are talking about a harm that is already baked in. How to improve their situation when they lack college degrees is a completely separate, and equally complex, policy discussion.

6141

And paying off a single group of graduates’ loans doesn’t solve any of these problems. I’ll support loan forgiveness as long as it’s part of a comprehensive package that addresses the issues you describe.

If it doesn’t, it just means we’re having this debate again in 10 years.

6142

Yes, as I said at the start, such a move would surely lead to litigation. So what?

It is a moral hazard argument, whether you want to admit it or not. It’s an argument of the form once you do X, everyone will believe you will always do X, and they will take advantage of you. That’s the argument that meant that it was mostly homeowners, not lenders, who lost during the great mortgage default crisis. That’s the argument that keeps unemployed compensation ridiculously low. Not to put to fine a point on it, but fuck that argument.

Pick a meaningful number — $25k or $30k, something a that matches the average debt or approaches the median debt — and forgive everything up to that, and suspend all payments on loans up to those amounts until the matter is resolved by the Courts, and eliminate the accumulation of any interest during that interval. That resolution will not happen quickly — we’ve seen that — and people will get tons of relief while that time passes. In the worst case, you lose in court in a year or two, but you’ve had a year or two of halted payments and no accumulated interest. In the best case, you’ve probably eliminated the student loan debt for the poorest half of debtors.

Of course you also need to do something about the future of student loans. My view is that there should be no federally-subsidized, federally-backed for-profit student loans. The government should be the lender, and to the extent someone wants to be in the private student loan business for high-value loans, they’re on their own, and student loans should be dischargeable in bankruptcy proceedings like any other debt. But you need Congress for that, and you can’t get that anytime soon, and waiting on some other action means doing nothing, and doing nothing sucks and gets you defeated in November of 2022 and 2024.

6143

Yes, I think a reasonable reaction to student loan forgiveness on the part of universities would be to double their tuition costs. Why not? Parents will now happily sign up for those loans knowing that they too will get forgiven, and if they aren’t, you just created a ticking time bomb of voters who are going to be super pissed.

6144

I paid my loans off 15+ years ago. But what about a one time credit of applying the total interest paid on the loans say over the last 10 years, and that money gets deducted from the remaining principal ?

What are loan interest rates anyway? 6% still?