Why Canceling Student Debt Now Is Stupid And Wrong

Stop throwing money at the problem

Image from Canva

Why don't people socialize anymore?

We’ve become a nation of early birds and fewer people are partying now.

Restaurants are squeezing more people into the mid-afternoon lull, according to Yelp and the WSJ. And the number of people dining between 2 p.m. and 5 p.m. has doubled from 5% in 2019 to 10%.

Why? I think it’s because everyone is too busy wageslaving to pay off insurmountable student debt to bother making friends or doing literally anything but work.

• 45 million student loan holders

• 160 million workers

• 28% of the workforce taking a $200-300/month haircut

• Economy goes into rapid decline due to depressed consumer spending

So, the looming decision that President Biden still (and might?) cancel $20,000 in student debt. It sounds great, especially for millions of borrowers like myself. But let’s be real: it's just a desperate attempt to snag some votes.

Here’s why canceling student debt is a really dumb idea.

The University System is a Profit Center, Not a Center of Higher Learning

The student loan payment pause is helping me and others out, but it does nothing to fix the broken system that got us here in the first place.

College is the biggest scam on the planet.

Higher education is worse than Scientology. It’s a complete grift.

Everyone knows this and we’re doing nothing to fix it.

Universities have been raising tuition at an astonishing rate, far outpacing inflation. And for what? The quality of education has not gone up one bit; in fact, according to a study published by Washington University, around 53% of recent college graduates are unemployed or underemployed.

College is a racket—a con. LSU has a lazy river on campus. A LAZY RIVER. And they’re charging students $60,000 yearly for the privilege of going there.

Facebook

The problem is that forgiving student debt encourages universities to further increase prices since students will take out bigger loans knowing there is a precedent for debt forgiveness.

Universities, wasteful degrees, inflated costs and shit job employers who think you need college accreditation for everything are the real problem.

To clarify, I don’t think colleges should put someone in massive debt — but going at this from the debt forgiveness angle only puts a bandage on the problem. In five years, we’ll look back at this and say, “what the hell were we thinking?”

The Many Problems With Biden’s Plan

I get it. Biden promised ad nauseam to cancel student debt.

He had to do it.

But right now was not the time. It was the worst time.

There’s still a looming economic crisis where any move to cancel debts or print money could exacerbate the problem. The dollar is losing value and governments will pay roughly $2.2 trillion in overall debt interest this year.

Here are the many other problems with his plan:

• College graduates are some of the most privileged people in society, meaning this money could have been better distributed among the middle and lower classes. For instance, we could have made Community College free for any US Citizen.

• Biden’s plan does not reflect earnings potential, meaning white-collar professionals like law and business graduates with high future salaries will benefit from this most.

• Middle-Class American taxpayers will foot the majority of this bill through inflation and taxes.

• The overall amount of outstanding federal student loan debt will return to $1.6 trillion (its current level) within five years, highlighting that the real problem isn’t fixed.

• The Supreme Court will likely keep fighting Biden on this.

The Biden plan is myopic and will do more harm than good in the long run.

None of this is well thought out.

What Needs to Be Done to Solve This Problem

The problem with this forgiveness is… what about next year?

What about Seniors in high school this year? Do they get forgiven?

Why wouldn’t I tell my 14-year-old sister to take out at least 10k in loans if she goes to college? All of this is a slippery slope leading to more money getting wasted on the post-secondary education system scam, which, as we established, is a bloated broken mess.

The way to REALLY fix this problem is by changing the system from within.

We need to send our kids to community colleges or trade schools or have them take a year off to work and save up money.

We need to support Google accreditation and other ways of learning that don’t involve putting yourself in massive debt.

We need to revamp the entire system so it’s not so reliant on predatory loans — in fact, I’m going off on a limb here: I don’t think lenders ought to be giving unsecured loans to children with no income or credit and above all, I don’t think the US government ought to be a lender at all due to the moral hazard it creates.

I hope some kind of financial burden can be alleviated from my generation because I’m sick and tired of seeing fucking bank bailouts.

But student loan forgiveness is not the panacea long-term fix its lauded as. College is a broken system and we need to stop throwing money at the problem.

---

This installment of Yard Couch is free for everyone. I send this email bi-weekly. If you like my work please consider joining 4,000+ other people and subscribing!