There have been a lot of half-baked attacks on President Joe Biden’s recently announced initiative to forgive some of the crushing mountain of student loan debt that’s weighing down Americans of all ages.
There’s the claim that it will somehow worsen the inflation that’s been plaguing the global economy.
But as expert after expert has patiently explained, the program simply isn’t big enough to have such an impact. As Nobel Prize-winning economist Paul Krugman observed with respect to the U.S.: “We’re talking about tens of billions a year in a $25 trillion economy. That’s basically a rounding error.”
And then there’s the offensive allegation that many of the people who will benefit are undeserving. Always sure-to-offend Texas Sen. Ted “Cancun-is-the-place-to-be-during-a-paralyzing-ice-storm” Cruz, alleged that the plan is about aiding pot smoking “slacker barista(s) who wasted seven years in college.”
Meanwhile, North Carolina’s Rep. Virginia Foxx, the ranking Republican on the House Education Committee, echoed that claim by effectively describing Biden’s plan as a giveaway to deadbeats and an effort by Biden to “appease his radical progressive base.”
But, of course, such detached, “get off my lawn” broadsides ignore the fact that the cost of college has tripled over the last 40 years, while federal Pell grants for young people of modest means have remained flat.
And speaking of detachment, it seems worth noting that Foxx attended UNC-Chapel Hill when in-state tuition averaged $175 per year and American worker productivity was a fraction of present-day levels.
What’s more, as Holly McCall of the Tennessee Lookout observed last week, these attacks also ignore the fact that, as of the end of 2020, almost a quarter of the total student loan debt, or about $336 billion, was owed by Americans ages 50 and over.
And let’s also not forget that a considerable chunk of the debt is attributable to scamming for-profit schools, like Trump University, which lured students into expensive loans with bogus promises of lucrative careers – a phenomenon that lawmakers like Foxx abetted with lax oversight and a failure to adequately fund legitimate colleges and universities.
But if there were a contest to identify the most offensive of all of the right’s many complaints about Biden’s relief plan, the winner has to be the assertion that student loan debt forgiveness constitutes a transfer that shifts the responsibility unjustly onto innocent taxpayers.
Foxx has been an especially enthusiastic purveyor of this particular claim.
Even a moment’s reflection should have alerted the conservative political operatives who cooked up this line of argument, however, that it probably isn’t a road that Foxx, Cruz or their ideological allies want to head very far down, lest they find quickly themselves reminded of some inconvenient truths.
Take, for instance, the massive wealth transfer that’s plagued the American economy in recent decades. As analysts at the Institute for Policy Studies describe in painful detail at the website Inequality.org, (and most of us can see plainly with our own eyes) the super-rich have become obscenely rich in recent decades even as the wealth and incomes of the middle class have stagnated. And this shift has been hugely abetted – particularly since the Reagan years of the 1980’s – by repeated Republican tax cuts on the wealthy and profitable corporations. Indeed, the policies of the Trump years acted to send this phenomenon into a kind of hyperdrive, even as it caused the federal debt to soar.
A similar phenomenon has taken hold across the country in state government as well. Here in North Carolina, analysts at the N.C. Budget & Tax Center even coined a name for the phenomenon; they dubbed it the “Great Tax Shift.”
But, of course, the idea of the wealthy and politically powerful using the tools of government to line their already overstuffed pockets can take many forms.
Take the fossil fuels industry. According to the International Monetary Fund, worldwide subsidies for coal, oil, and natural gas reached $5.9 trillion in 2020. That’s roughly $11 million per minute. This for an industry in which the combined profits of the largest companies in the first quarter of this year topped $100 billion.
Where is the conservative gnashing of teeth about taxpayers having to foot that mountainous bill?
The bottom line: As with so many other areas of modern public policy, the central lesson of the national student loan debt mess lies not in a discussion of the cleanup, but in an honest assessment of the root causes. And if and when that discussion occurs, let’s hope elected leaders are forced to own up to how cheapskate budgeting and inadequate regulation have transformed higher education from what it ought to be – a universally accessible public good that is, as the North Carolina constitution puts it, “as free as practicable” – into a costly and wealth-sapping luxury and a magnet for predatory businesses.