There have been many half-baked attacks on President Joe Biden’s recently announced initiative to forgive some of the crippling mountain of student loan debt plaguing Americans of all ages.
It is claimed that this will somehow aggravate the inflation plaguing the global economy.
But as expert after expert has patiently explained, the program just isn’t big enough to have such an impact. As Nobel Prize-winning economist Paul Krugman observed of the United States: “We’re talking tens of billions a year in a $25 trillion economy. It’s basically a rounding error.
And then there’s the offensive claim that many of the people who will benefit don’t deserve it. Always sure to offend Texas Senator Ted “Cancun-is-the-place-to-be-during-a-crippling-ice-storm” Cruz, alleged the plan was to help “lazy baristas smoke of the jar”. ) who lost seven years in college.
Meanwhile, U.S. Representative from North Carolina Virginia Foxx, the top Republican on the House Education Committee, echoed that claim by effectively portraying Biden’s plan as a giveaway to the bad guys. payers and an effort by Biden to “appease his radical progressive base.”
But, of course, such loose, “get off my lawn” edges ignore the fact that the cost of college has tripled over the past 40 years, while federal Pell grants for young people of modest means have remained flat. .
And speaking of secondment, it’s worth noting that Foxx attended UNC-Chapel Hill when in-state tuition averaged $175 a year and American worker productivity was only a fraction of current levels.
Moreover, as Holly McCall of the Tennessee Lookout observed, these attacks also ignore the fact that by the end of 2020, almost a quarter of total student loan debt, or about $336 billion, was owed. by Americans aged 50 and over. .
And let’s also not forget that a huge chunk of the debt is attributable to the scam of for-profit schools, like Trump University, which lured students into expensive loans with false promises of lucrative careers. – a phenomenon that lawmakers like Foxx have encouraged with lax oversight and a failure to adequately fund legitimate colleges and universities.
But if there was a contest to identify the most offensive of all the many right-wing complaints about Biden’s relief plan, the winner must be the claim that canceling student debt constitutes a transfer that unfairly shifts liability onto innocent taxpayers.
Foxx has been a particularly enthusiastic provider of this particular assertion.
Even a moment’s thought should have alerted the conservative political operatives who concocted this argument, however, that this is probably not a road that Foxx, Cruz or their ideological allies want to take very far, lest they end up quickly reminded of some inconvenient truths.
Take, for example, the massive transfer of wealth that has plagued the US economy over the past few decades. As analysts from the Institute for Policy Studies describe in painful detail on the Inequality.org website – and most of us can see it clearly with our own eyes – the super-rich have become incredibly wealthy over the decades, even as the wealth and income of the middle class has stagnated.
And that change has been greatly encouraged — especially since the Reagan years of the 1980s — by repeated Republican tax cuts on wealthy, profitable corporations. Indeed, the policies of the Trump years acted to send this phenomenon into a sort of hyperdrive, even as it sent the federal debt skyrocketing.
A similar phenomenon has also taken hold across the country in state government. Here in North Carolina, analysts at the NC Budget & Tax Center have even invented a name for the phenomenon; they dubbed it the “great tax shift.”
But, of course, the idea that the rich and politically powerful are using the tools of government to line their already deep pockets can take many forms.
Take the fossil fuel industry. According to the International Monetary Fund, global subsidies for coal, oil and natural gas reached $5.9 trillion in 2020. That’s about $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 Tory gnashing of teeth about taxpayers having to pay this mountainous bill?
The Bottom Line: As in many other areas of modern public policy, the central lesson of the national student debt mess lies not in a discussion of cleaning up, but in an honest assessment of the root causes. And if and when that discussion takes place, hopefully elected leaders will be forced to admit how stellar budgeting and inadequate regulation have transformed higher education from what it should be – a universally accessible public good that is , as the North Carolina Constitution says. , “as free as possible” – into an expensive, wealth-sapping luxury and a magnet for predatory corporations.
Rob Schofield is director of NC Policy Watch, the news and commentary arm of the progressive North Carolina Justice Center.