Student Loan Forgiveness | Hacker News Reader

Student Loan Forgiveness

cato.org

6 pointsRickJWagner6 comments

If this forgiveness stands, future borrowers will take out even more debt, believing that future presidents will likely cancel some of it. They will probably be right.

This moral hazard increases the cost of the loan program; more and more is paid out, and less and less is re‐ paid.

The moral hazard of believing education should be free at the point of usage!

My dad fought in World War 2 along with 2 older brothers. They benefited from the GI Bill and went to college and ended up with good careers. We call them the greatest generation but the thing that made them the greatest was the investments the government made into them. His 2 younger brothers did not go college and they had much less lifetime income and died earlier than the older 3.

Government ought to invest in people. It benefits the nation to have an educated populace that is not saddled with debt upon graduation.

Agree...but any program to subsidize education should be done in a well-understood, predictable manner. It is deeply unjust and arbitrary for the government to retroactively hand out money to some people based on decisions they made long ago with different assumptions. Those people who chose a cheaper college for financial reasons; or who sacrificed their social life to work their way through college; or who paid off their loans early...would now be suckers for having made decisions that seemed financially responsible at the time.

I don’t understand the sentiment. I paid off my student loans and I hope others get forgiveness. I don’t see how their gain is my loss. I am happy when bad situations get rectified even when I don’t benefit.

Because you could have waited on paying off your loans, and under Biden's plan you would have got $20K handed to you. In that case, the decision to pay off your loans would have carried an opportunity cost of $20K to you.

"I hope others get forgiveness." Loan forgiveness does not mean the debt magically disappears; it means somebody else is paying it. That "somebody else" is a taxpayer, who might be a plumber or Walmart clerk who never went to college. "Their gain" really is somebody else's loss, who likely makes less money than the beneficiary of loan forgiveness.

I believe your view is wrong. That plumber you talk about benefits from an educated society. We all benefit from this. Was it unfair to polio victims that future generations benefited from the polio vaccine? It’s ok when bad policies get fixed even though some are alive that were harmed by the bad policy.

Of course the debt doesn’t magically disappear. It’s an investment into the nation to have an educated country. That investment pays dividends. It’s better to spend the money on this investment than bombs, militarized police, and a host of other programs.

I think people should be held responsible for their loans.

I also think adults who take advantage of children’s ignorance should be held responsible.

For me, having signed on for a bunch of loans, on the magnitude of thousands of dollars, at the age of eighteen, when I had never held more than $20 cash in my life let alone a checking, savings, loan or credit account, well it seems like there should have been mechanisms in place to intervene. Does that mean I deserve loan forgiveness? I don’t know. I’d probably prefer to keep my debts and see the people who profited off of me locked up. But I hope painting a picture of individual situations gives us a better vantage point for judging not what people should do, in an idealized world of uniform opportunity, but how real people become stuck in situations they never understood or knew they had a choice about.

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