It's hard for some supporters of student loan forgiveness to understand the antipathy toward the idea. But I think a lot of it is this: America has developed into a class society divided between college-educated and non-college classes, and student loans felt like an equalizer.
In other words, I think many people look at the college-educated class, who earn more then them, get more respect, have nicer jobs, have more job security, suffer less employment in recessions, etc., and think "well at least I don't have to pay off a bunch of student loans."
That's not to say I agree with this attitude or that I feel this feeling myself. I don't. I'm just trying to explain it.
What we actually need to do is compress this class society back into a middle-class one, raise wages, improve job security, reduce unemployment, etc.
What we actually need to do is compress this class society back into a middle-class one, raise wages, improve job security, reduce unemployment, etc.
But even if a big structural transformation of our class society were on the table right now politically, I think a lot of people just don't imagine it happening. So in the meantime, cancelling student debt in isolation just feels like one more free win for the college class.
Personally, I think student debt forgiveness is a good idea, because giant piles of loans hold back the potential of many of our most productive workers, who would otherwise be starting business, switching to better jobs, moving, etc.
But that's a very economist-y view.
But that's a very economist-y view.
Most people out there in the world have distributional preferences -- they don't care so much about whether our society produces higher GDP with less search frictions and blah blah blah, they mostly care about where they fit into that society.
And currently, the non-college class has spent 40 years watching the college class go from strength to strength -- the lords of human capital, the favored children of the New Economy.
Now student debt forgiveness would be one more win for the golden kids.
Now student debt forgiveness would be one more win for the golden kids.
Of course, to an economist, any win, even for the golden kids, is a win for society. And if student debt is holding our economy back, just get rid of it!
And in fact I think this is the right and obvious thing to do. Duh! More GDP!!
And in fact I think this is the right and obvious thing to do. Duh! More GDP!!
But I've encountered a lot of people pushing back very hard against student debt cancellation, and I'm trying to think about where they're coming from, and I think for a large fraction of them, it's this feeling that cancellation compounds an entrenched form of inequality.
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