Tag: student loans

bookmark_borderOveranalyzing the pro-Palestine posters in Malden

Posted on by Marissa

Lately, I have been seeing various pro-Palestine posters and stickers taped to stop signs and streetlights around my town. One such example is the below poster, which was displayed at the pond near my house:

The first thing that stood out to me upon reading the poster was that the pro-Palestine groups or individuals who put this up poster chose, in arguing against using tax dollars to fund Israel’s weapons, to list different expenses that the tax dollars could be spent on instead, rather than arguing that the tax dollars simply be returned to the people from whom they were taken.

I guess there is nothing wrong with providing households with public housing or solar electricity, as long as the selection process is fair. Same with elementary school teachers and N95 masks.

But I’m puzzled that the flyer mentions specifically that 326 children could be provided with healthcare. Why isn’t providing adults with health services considered a worthy goal? Health services are something that apply to all ages equally, after all.

And advocating that tax money be used to cancel the student loan debt of 24 people is even more problematic. Canceling student loan debt is discriminatory and unfair. People made sacrifices to save up for college under the assumption that if they didn’t, they would have to take out loans and pay the money back. When loan debt is canceled, people who saved up are stuck having paid for college, while those who chose not to save are rewarded by having college made free. You simply cannot make a product free after some people have already paid for it, because that makes the product free for some people and not others. I would much rather see tax money spent on weapons for Israel, or almost anything for that matter, than this. 

As I alluded to earlier, the best argument against spending $939,024 on Israel’s weapons is the fact that the government could instead simply return this money to taxpayers, or even better, not collect it in the first place. This solution is the simplest and fairest one. Allowing people to keep more of their own money benefits everyone, not just politically favored demographic categories. Why doesn’t the poster advocate for this instead?

Probably because benefiting politically favored demographic categories is exactly what the left values. 

To end this post on a somewhat happy note, it seems that another Malden resident isn’t a fan of the pro-Palestine posters either. This is what happened to an identical poster on a nearby light post:

bookmark_borderWhy student loan forgiveness is unjust

Posted on by Marissa

In the debate about student loan forgiveness, people often point out that many people opposed to loan forgiveness had their college education paid for by their parents, Therefore, the implication is, the opposition to loan forgiveness is illegitimate, because opponents are so “privileged” that they never had to take out loans themselves.

Nothing could be further from the truth. The fact that some parents saved up to pay for their children’s college education demonstrates exactly why student loan forgiveness is unjust.

Student loan forgiveness is unjust not because it is essentially a government-funded bailout of the rich, as many conservatives argue. It is not unjust because it subsidizes colleges, thereby allowing them to continue increasing their prices (although this is probably true). It is not unjust because it forces people who chose blue-collar careers to subsidize people who chose to study less practical subjects such as gender studies (although this is probably true, too). It’s not even unjust because it goes against the principle of personal responsibility by letting people off the hook for the financial ramifications of their decisions (although this is true as well).

Student loan forgiveness is unjust because it changes the rules after people have already made decisions based on the old rules.

Before student loan forgiveness was introduced as a possibility, it was assumed that if someone goes to college, they must pay for it. This is, after all, the way that things work with any product or service. If a person chooses to purchase a product or service, then the person must pay what the product or service costs. For some products and services, including college, there is the option to pay the cost now, as well as the option to pay the cost later, usually with interest added (also known as taking out a loan). Given that they would need to pay the cost at some point regardless, my parents chose to save up money so that they could pay at the beginning, rather than taking out a loan and facing the likelihood of having to pay interest.

But then, thanks to Joe Biden, the rules changed so that people who chose the second option (taking out a loan) are now being told that they don’t have to pay at all! (Technically, they have to pay $10,000 less as opposed to nothing at all, but the same principle applies). This means that my parents, after having already made the decision to pay at the beginning to avoid being charged interest, are now being told that if they had chosen the second option instead, they would be charged a smaller, not a larger, total amount of money. But it is too late for my parents to change their decision, because they have already paid. And there is no way for them to get their money back, because instead of treating people equally, the Biden administration is bestowing the $10,000 discount upon only those people who chose the second payment option (taking out a loan). 

Needless to say, had my parents known that they would receive a $10,000 discount if they had simply not paid and taken out a loan instead, they would have chosen this option. Choosing the first option (paying at the beginning) required my parents to save up money, and they made sacrifices in order to do this, such as working full time and foregoing other purchases. If they could have saved up less money with zero negative financial ramifications, my parents would have been able to take more vacations, make improvements to their home, or buy additional clothes and toys, to give just a few examples. It is patently unjust that parents who chose the vacations or the home improvements (or perhaps who chose not to work at all) instead of saving up money are now going to be rewarded for their choices with a $10,000 discount, while my parents are stuck having paid the full price with no way to get any of their money back. 

In conclusion, there is definitely a need to make college less expensive. But the problem with student loan forgiveness is that it makes college less expensive retroactively, after some people have already paid the full amount. Student loan forgiveness makes it so that one of two payment options comes with a discount… and people are not told this at the time when they must make a decision, but only after the decision has already been made. In other words, student loan forgiveness changes the rules after people have already made decisions based on the existing rules. This is what makes it unjust. When loans are forgiven, a situation is created in which people like my parents, who made sacrifices to save up money, turn out to have saved up that money for nothing. If people with student debt are going to get $10,000 of their debt forgiven, then people who have already paid must receive a $10,000 refund.

bookmark_borderCancelling student loans is unfair and unjust

Posted on by Marissa

As the country considers various options for helping the economy recover from the coronavirus pandemic, several lawmakers are pushing for forgiveness of student loans.

For example, Representatives Ayanna Pressley and Ilhan Omar introduced a bill in March to cancel up to $30,000 in student debt per person. Senate Democrats have pushed unsuccessfully for student debt forgiveness to be included in both the CARES Act and the HEROES Act. The group Student Debt Crisis has gathered 1.2 million signatures in support of urging Congress to forgive student loans. Bernie Sanders promised to eliminate all student debt during his presidential campaign, and Joe Biden is proposing forgiving student debt for low-income people, teachers, public service workers, and graduates of public and historically black schools.

Student debt forgiveness is now being viewed as a racial justice issue as well. “Black student borrowers borrow and default more than anyone else because of our inability to build generational wealth,” Pressley said to Yahoo Finance.

Pressley also tweeted, “Cancel rent. Cancel mortgage. Cancel student debt.”

Cancelling debt is fundamentally unfair. There are some people who make tremendous sacrifices to pay for college so that they won’t have to take out loans. Some people work throughout their time in college in order to pay tuition. Some people go without in order to save up for college, and some parents start saving for college when their child is born. Have any of the proponents of student loan forgiveness ever considered how those who saved up for college would feel upon learning that all of their sacrifices were for nothing? That they could have spent their money on other things and gotten a college education for free if they had only waited? Forgiving student loans is essentially making college free… but only for people who borrowed money. People who already paid would be stuck having already paid. A plan to cancel student loans would only be fair if anyone who paid for college got his or her money back as well.

But one also needs to consider that cancelling student loans is unfair to people who chose not to go to college, or chose to go to a less expensive college, because of the cost. Imagine having made the decision years ago to forgo college, or to go to a less prestigious college, only to learn that you could actually have gone to an expensive, prestigious college for free. Additionally, forgiving student loans is arguably unfair to people who earned merit scholarships. Imagine getting to attend college for free (or at a substantial discount) as a reward for your intelligence, talent, and academic achievements, only to find out that people without the same achievements also get to attend college for free, simply because they chose to borrow money.

Forgiving debt is unfair and unjust because it provides a benefit to some people while denying that benefit to other people who are equally deserving.

bookmark_borderStudent loans and bad analogies

Posted on by Marissa

Another post that I began a long time ago but did not have time to finish until now…

A while ago, former speaker of the house Newt Gingrich tweeted, “If leftists want to forgive student debt shouldn’t they also propose giving back the money to everyone who worked hard and paid off their student loans?”

I agree with this sentiment 100%. Forgiving debt, as appealing as it may sound given the exorbitant cost of college and the crushing loans people incur in order to pay for it, poses significant fairness issues.

In regards to paying for college (or any expensive item, for that matter), there are essentially three different options:

  1. Someone could save up money and pay for college without taking out any loans.
  2. Someone could take out loans to pay for college.
  3. Someone could simply decide not to go to college.

Forgiving loans gives a benefit to people in category #2, but not to people in category #1 or category #3. It essentially gives free money to those who chose to pay for college through loans, while giving nothing to people who saved up for college or who opted out of college entirely.

In other words, forgiving loans is deciding to make something free after some people have already paid for it. If you are going to do this, fairness requires that you also refund the money for those who have already paid.

Various people in the twitterverse came up with snide responses to Newt’s tweet that on the surface sound witty and clever but actually don’t make sense.

First of al, several people personally attacked Gingrich for his sex life and the fact that he went through a divorce (imagine what the reaction on Twitter would be if someone attacked a female politician with this type of criticism), something that is not appropriate and has nothing to do with the issue of student loan forgiveness.

“Child labor laws… seems like a good idea, but have you thought about how frustrated all the kids who already lost limbs in the mill will feel??” tweeted @SamAdlerBell.

“Guys, look. We can cure cancer but what about everyone who already died from it? IDK seems unfair,” tweeted @sssh_sstrn

These analogies do not make sense. This is because saving up to pay for college – unlike losing a limb at work or dying of cancer – is something a person chooses to do.

For everyone in category #1 above, the option of borrowing money was available to them; they simply choose not to because, based on the rules in existence at the time, paying upfront made more financial sense. The decision to pay upfront for college is based on the presumption that if one took out loans, one would then be in debt and would eventually have to pay back the loans with interest, which would mean paying more in total. If people knew that student loans were going to be forgiven, no one in their right mind would pay for college; everyone would simply take out loans knowing that the loans would be forgiven and college would effectively be free. In other words, changing the rules so that loans are  forgiven makes it so that taking out loans actually would have made more financial sense, but there was no way for people to know this at the time. It is not OK to change rules after people have already made decisions based on the old rules.

My parents are an example of this. Ever since I was born, they gradually saved up money for college. Both of them worked at middle-class jobs and saved money every month. They were not poor, but they were not rich either. If the government announced that student debt was going to be forgiven, my parents and I would have legitimate reason to be upset. If they had known that there was no need to save for college, my parents would have had that much more discretionary income to spend. My family would have taken more vacations or bought a larger house or more clothes or toys. Perhaps one of my parents would have chosen not to work.

This simply does not apply to the situations claimed to be analogous by the people on Twitter. After workplace safety laws are passed, no worker thinks, “I wouldn’t have chosen to lose my limb had I known these workplace safety laws were going to be passed.” That would make absolutely no sense. Losing one’s limb is an accident; it is not something anyone chooses to do. Similarly, no one chooses to have cancer. So the anti-Newt tweeters are missing the point: student loan forgiveness is problematic because it changes the rules after people have already made decisions based on the old rules. The other situations have nothing to do with this.

Another Twitter user named @dave_petr wrote about his desire for future generations to have it better than he did and asserted that “selfless sacrifice is kinder.” But there is nothing kind about bestowing a benefit on some people while leaving out others who are equally deserving. People who have scrimped and saved to pay for college deserve kindness as well. They do not deserve to see other people receive the thing that they have scrimped and saved for, for free.

Either choose an amount of money (perhaps the cost of a typical college education, or the average amount of student debt per person) and give everyone that amount of money, or do nothing. Giving free money to some people and not others is unfair and morally wrong.