As part of her presidential bid, Elizabeth Warren is pushing for a student loan forgiveness program along with Bernie’s free college plan.
Naturally conservatives are going to hate this idea, partly because it’s a massive government expense and partly because it’s profoundly unfair. I’m inclined to agree with both of those arguments. In regards to the cost, I think the economics 101 answer to rising college cost is to build more state colleges (increase supply) rather putting the government on the hook to pay outrageous tuitions. And in regards to the fairness, someone who took a huge risk taking out $80k in student loans and someone who took a lesser paying career path to avoid that risk would be in the same financial position after the former’s loans are wiped out, except now that person has a higher earning potential. Sure it would boost the economy, but there are other places we could pump a trillion dollars other than upper middle class college grads who may or may not have made good decisions in the first place.
I think worrying about fairness is generally a waste of time, but considering the price tag, I’m having a hard time seeing how this is a good idea.