I don’t know if I should comment on this week’s MoveOn.org email or allow it to speak for itself.
Forgiving the student loan debt of all Americans will have an immediate stimulative effect on our economy. With the stroke of the President’s pen, millions of Americans would suddenly have hundreds, or in some cases, thousands of extra dollars in their pockets each and every month to spend on ailing sectors of the economy.
As consumer spending increases, businesses will begin to hire, jobs will be created, and a new era of innovation, entrepreneurship, and prosperity will be ushered in for all. A rising tide does, in fact, lift all boats—forgiving student loan debt, rather than tax cuts for corporations, millionaires and billionaires, has a MUCH greater chance of helping to raise that tide in a MUCH shorter time-frame.
The future economic success of this country is wholly dependent upon a well-educated, prosperous middle class. Instead of saddling entire generations with debt from which there is no escape, let’s empower the American people to grow this economy on their own!
All of the bailouts, such as TARP, were a mistake. They were foisted onto the American people because the affected institutions were “too big to fail.” MoveOn.org is essentially saying what was good for the goose should be good for the gander. What a slippery slope!
There’s not much difference between bailing out financial institutions and college students who borrowed a lot of money to finance their education. In the former case, the banks and mortgage companies knew they were taking huge risks with exotic products like “securitized mortgage backed securities.” In the latter, students entered into a legal contract agreeing to repay a loan. It’s a tough sell to claim ‘poor me’ regardless of one’s size when you know the risks and engage anyhow.
Our economic and political system is supposed to allow a person to own and control what they can create and earn. When government decides for us that we have to pay for the mistakes or, in this case, the voluntary choices of another, there is justifiable resentment. Why work hard if the fruits of one’s labor will go to someone else? If we take the incentives out of our economic system, it will break. Government is supposed to protect the rights and property of its citizens, not take them away.
It’s also hard not to be a bit cynical about this demand. Remember the federal takeover of student loan program as a part of the health care bill in 2009? How easy it would be for the federal government to erase almost one trillion dollars ($1,000,000,000,000; the words don’t do the number justice) from its balance sheet. We already see too much fiscal irresponsibility for political gain. Do you think students will back a candidate or a party willing to negate their financial liability?
The financial bailouts of 2008 created the outrage that evolved into the Tea Party. The calls for government to continue the fiscal insanity of more spending when we’re broke keep it going.
As if this demand wasn’t outrageous enough, don’t get me started about the unconstitutionality of doing this “with the stroke of the President’s pen.”