Everyone Arguing About Student Debt Forgiveness Is Wrong
Today, in Paul Millerd's Substack, he asserted something that resonated so strongly with me that it gave me instant clarity as to this feeling I've been having this week that there's something wrong with the U.S. student debt forgiveness debate.
Enter Paul:
"I think one of the saddest things to observe with this kind of debate is how quickly people accept the current frames of for/against the current action, anchored in takes like 'this costs too much,' 'the system is rigged,' or 'this is unfair.'
What you rarely hear is 'we need to unleash more human creativity into the world.'
The default path stories of work have convinced far too many people that the point of life is to suffer, pay your dues, and work continuously. All that matters is having a job. We look at massive debt for higher education as a fact of life and place all responsibility on the individual."
- They volunteer not for the benefit of helping others but because it looks good on a college application.
- They study for the purpose of getting a high grade on a test and not for the inherent satisfaction and growth that comes with gaining new knowledge.
- They are forced to visit guidance counselors who only give them information on what colleges to go to, and what majors to pursue, rather than helping actual, you know, guide them toward a career path that would actually be fulfilling for them and valuable to society.
- They are shamed by teachers, friends, and sometimes parents, by the mere suggestion of wanting to pursue a path in life that does not include a college degree.
- For years, kids are ceaselessly peppered with questions, such as, "What are you going to do when you grow up?", "What are you going to study in college?", and "What college do you want to go to?" To the point that they feel like they have no choice but to go to college, cost be damned. Most adults don't know what the hell they're doing - how can we expect kids to have their life so perfectly planned out by the time they're 18?
1. The left/right, either/or argument for or against debt forgiveness is a distraction from the most important questions.
Paul is absolutely correct. Instead of both sides screaming, "this isn't fair!" why can't we discuss how much human potential can be unleashed when people aren't shackled to jobs they hate just to pay student debt that seems to always increase and never decrease?
What happens when people are free to create new products, new services, and new opportunities to help their families, customers, and communities?
2. Student debt forgiveness is not fair. Student debt is also not fair.
Alright, since everyone is arguing about fairness, I'll bite.
All of it is unfair.
The entire system of funding education with public debt was a fucked up idea from day one. The suggestion is that higher education is a public good, but the public should not have to pay for it. As a society, we value education for the first 17 years of a human's life enough to pay for it with massive amounts of public funds. We can argue if that's right or wrong, but that's the current system.
If we asked families to pay for public education - kindergarten, grade school, middle school, and high school - with education debt that they'll be shackled to for decades (possibly until death), there would a violent revolution in the United States.
Why should higher education be different?
So now we have a fucked up system that requires a fucked up solution so the inherent unfairness of one side (debt holders) is now shared by everyone.
This is what happens when you have a terrible system from day one and you let it fester and get worse for decades.
The bottom line is the federal government never should have been, and needs to immediately cease, being involved in funding higher education.
3. People who argue, "Why should I pay for your education with my taxes?" are virtually guaranteed to not pay an extra penny for anyone's student debt forgiveness.
Just as almost no one pays extra when the government runs a higher and higher deficit most years, or when it loses money on investments it makes in businesses and infrastructure, funds overseas wars it can't afford, or when it forgives other types of loans (as has been widely discussed regarding forgiven PPP loans for republicans).
When was the last time the government effectively raised taxes on anyone except top earners? It's political suicide. So, no one is going to pay more for this forgiveness. It's just going to get added to the debt like everything else.
4. No one is talking about the ramifications of how society, and sometimes parents, brainwash children into believing they will live a life of destitution unless they receive a university degree.
As if the only path to financial soundness and, by implication, life-long happiness, is a $200,000 piece of paper.
Kids' lives are geared entirely toward higher education and little else:
5. People who argue that student debt holders should "just pay it off" do not understand that student debt is fundamentally not like any other kind of debt.
I discuss this at length here: https://notepd.com/idea/10-reasons-why-student-debt-is-a-complete-scam-uckkb
6. The only escape from this ridiculous conundrum is to create your own path.
@JamesAltucher noted this solution in his list about student debt earlier this week: The best approach is to choose yourself and provide value through a business (or multiple businesses) of your own creation.
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