Power and control are root causes of economic oblivion. From MN Gordon at economicprism.com:
A recent White House fact sheet declares that President Biden has delivered on promises to cancel $10,000 of student debt for low- to middle-income borrowers. Who’s he really delivering for?
Without question, the student debt crisis is a disgrace. There are roughly 45 million student loan borrowers who owe on the order of $1.6 trillion. Most of this debt is from federal student loans.
Thus, the federal government is responsible for this mess. It supplied the credit. In turn, massive amounts of federal student loans inflated a higher education bubble and an industry of entitled, fake intellectuals.
The business model generally requires signing credulous 18-year-olds up for massive amounts of government backed student loans. These young adults have been told since before they could count that college was the magical path to a bright future. But as tuition costs ran higher, propelled by more and more student loans, the value proposition no longer penciled out.
To be clear, cancelling student debt rewards a corrupted education industry much more than it rewards overindebted students. It allows colleges and universities to perpetuate an inflated product.
Rather than cancelling student debt Biden should cut off government sponsored student loans. Scuttle the gravy train that supplies universities with undeserved wealth.
Now what would happen to all these high paid professors and fancy country club style college campuses without all this government sponsored debt? For starters, tuition prices would fall. Professor salaries would also fall. And college campuses would adjust to their more modest means.
Would the product – the education – be inferior? Not for the technical disciplines that matter.
Smaller budgets, however, would help trim the fat, and eliminate many of the nonsense quack ‘studies’ courses. These courses have little redeeming value and only exist because they’re funded by an abundance of federal student loans.