Weren't you the guy with the whole "don't use whataboutism" thing? I have to apologize, I get some of you progressives confused sometimes. Who cares if Trump ALSO did something wrong? IT was wrong then, and it is wrong now. You're back on the left/right thing, I'm trying to stay on the right/wrong thing. What is it you like to say? And here we go around again? I'm not dismissing it as some form of pandering. I'm naming that as ONE of the problems with it. I've repeatedly mentioned the moral hazard part.
Canceling student loan debt could benefit wealthy Americans the most https://www.foxbusiness.com/economy...debt-could-benefit-wealthy-americans-the-most President-elect Joe Biden is facing mounting pressure from progressives to cancel student loan debt on his first day in the White House – but doing so may disproportionately benefit wealthy Americans, according to a new analysis. A working paper published Monday by the University of Chicago’s Becker Friedman Institute for Economics shows that erasing all student loan debt would distribute $192 billion to the top 20% of earners in the U.S., but just $29 billion to the bottom 20% of U.S. households. Under a universal loan forgiveness program, the average individual among the top-earning borrowers would receive $5,944 in forgiveness, while those with the lowest incomes would receive $1,070 in forgiveness, according to the study, authored by economists Sylvain Catherine and Constantine Yannelis. (More at above url)
Forgiving student loans will only worsen inequality https://www.washingtonpost.com/opin...50d384-34c9-11eb-8d38-6aea1adb3839_story.html SOME 45 MILLION individuals in the United States owe $1.6 trillion in debt for college and graduate school tuition. They owe the vast majority of it to the federal government, so the obvious way to ease this burden on them, and a drag on the economy, is government-ordered debt cancellation, perhaps through executive action by President-elect Joe Biden after Jan. 20. Or so many Democrats urge, with Sens. Charles E. Schumer (D-N.Y.) and Elizabeth Warren (D-Mass.) pushing a plan to forgive up to $50,000 per borrower. We hope Mr. Biden says no — and explains that such wholesale debt relief is actually the antithesis of progressive policy. Most benefits would flow to upper-income households, which, despite the undeniable burden of debt for lower-income families, actually owe a disproportionate share of the total dollars. Sixty-four percent of U.S. adults age 25 and over do not even have a college degree, though that includes some who attended, and paid for, college but did not finish. What’s more, those who finish college are better positioned than others to earn more, so it’s hardly unfair to expect them to draw on this “education premium” to pay their debt. Sylvain Catherine of the University of Pennsylvania and Constantine Yannelis of the University of Chicago lend support to these points in a new analysis that emphasizes the value of debt relief to borrowers in light of real-world program rules and standard “present value” accounting. They find that debt forgiveness plans, whether universal or capped at $50,000 as Mr. Schumer and Ms. Warren propose, “are highly regressive, with the vast majority of benefits accruing to high-income individuals.” Even a plan capped at $10,000 would disproportionately favor upper-income Americans, though it should be noted that the specific $10,000 plan Mr. Biden floated during the campaign applied only to public-college undergraduate loans and phased out for households above $125,000 in income. Nor would debt cancellation do much to close the Black-White wealth gap, according to the Catherine-Yannelis analysis — a somewhat surprising finding given the fact that Black borrowers tend to have higher student-loan balances, on average, than Whites. While debt forgiveness would indeed improve the net worth of individual Black borrowers significantly, the benefits to White borrowers offset this, arguably exacerbating the wealth gap. A $50,000-per-household plan, for example, would confer 70 percent of benefits on White borrowers and 20 percent on Black borrowers. The cost of such a plan is unknown, though the Congressional Budget Office priced one $10,000 debt relief plan at between $250 billion and $300 billion. As it happens, a seemingly modest change the analysis considered would have the most progressive impact, including in terms of the racial wealth gap: making sure that everyone who qualifies enrolls in an existing plan that links debt repayment to a borrower’s income. Such plans, the study concludes, “are a useful tool for targeted loan forgiveness, and the benefits of this forgiveness largely accrue to middle-income individuals.” If the next president does not want to shower tax dollars on people who don’t need aid, but wants to do something useful — there is a way.
I agree that the student loan thing is regressive, on average a person with a degree makes over $750 more during their career. If you do that, you need to give some money to people who don't want to go to college $50k to start a business. Universal health care is a much more sensible place to spend money.
So this analysis only shows that similarly situated whites earn more than similarly situated blacks, thus loan forgiveness would be disproportionate based on income. Ok. I don’t think anyone in America is shocked to learn a white engineer earns more than a black engineer. It’s sort of the way we’ve been doing things the whole time. I bet if they broke it down by gender and income they’d find relief benefits men more than women too. The working paper also shows people holding the highest student loans, doctors and lawyers, are paying it back at a faster and higher percentage. Ok, again. That makes sense too. To me this isn’t a racial issue, but the working paper also cites loan forgiveness of $50k would increase black wealth by ~36%!!! That’s a wow number. The IDR stuff is good and absolutely worth consideration but again, this is about stimulating the economy, not about finding the best way to pay back student loans.
It's 2 very different concepts... A. We should be reminded that the Federal Reserve is owned by the Regional Federal Reserve Banks and they make decisions regarding the creation of trillions of dollars and then buying up trillion of dollars of mortgages and ETFs... independent of congressional oversight or control... (save pulling the bank's charter) When the FED creates trillions of dollars with a keystroke and then directs those funds to purchases mortgages, ETFS or other assets... The US govt does not have to pay that money back because it it did not authorize the expense and borrow the money. However... B. If however Congress spends the money to bail out students... since we are in deficit we must borrow the money from the Federal Reserve who has the Govt sign a note or contract in which we the taxpayers are on the hook for the money and presumably someday will have to pay it back. It's exceeding different.