[Zettel Feedback] Student Loan Forgiveness is Regressive
Student Loan Forgiveness is Regressive
Subatomic: Knock on effects of across-the-board loan forgiveness.
Surprising second order effects (Trophic cascade []) of student loan forgiveness. More children of families in the middle and upper tiers of society go to university and take out loans to pay for it. These families can handle the loan burden. They tend to get larger loans to pay for education. That education lands them high paying jobs where they can afford to pay back the loan. Loan forgiveness favors these upper income people to a larger extent and with a larger amount of money than those less fortunate. This increases rather than decreases the economic gap between social classes.
- B-The Other []
Across-the-board forgiveness is therefore a costly and ineffective way to reduce economic gaps by race or socioeconomic status. 1
…Accounting correctly for both human capital and effect of subsidies in student lending plans, almost a third of all student debt is owed by the wealthiest 20 percent of households and only 8 percent by the bottom 20 percent. Across-the-board student loan forgiveness is regressive measured by income, family affluence, educational attainment—and also wealth.1
Student Loan Forgiveness is Regressive by Alex Tabarrok January 20, 2022 at 7:29 am
I must keep doing my best even though I'm a failure. My peak cognition is behind me. One day soon I will read my last book, write my last note, eat my last meal, and kiss my sweetie for the last time.
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