0:00

I’m Matt Bellamy founding partner of Puck news and I’m covering the inside conversation about money and power in Hollywood, with my new show, the town I’m going to take you inside Hollywood with exclusive inside on what people in Show, Business are actually talking about multiple times a week.

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I’ll talk to some of the smartest people I know journalists insiders, all of whom can break down the hottest topics and entertainment.

Tell you what’s really going on.

Listen now, Today’s episode is about student debt forgiveness the big bold beloved despised, possibly midterm clinching and possibly illegal new policy from the B Administration which will forgive up to twenty thousand dollars of student loans for all.

0:46

But the richest student debtors So one thing that I try to do in most of these episodes is to try to find ways to express complicated ideas in a simple way.

And I want to begin today’s episode with a bit of a confession, not quite an apology, but a confession, which is that I don’t think I know how to do that with this issue.

1:11

I am incredibly torn about the substance and the wisdom of this policy of student loan forgiveness and Trying to hold several thoughts in my head at the same time.

Thought number one, is that the level of student debt in America represents a massive and possibly inherently immoral policy mistake.

1:32

And that there’s a strong moral case to be made that we should reduce outstanding student debt to help people who went to college, who did the right thing move on with their lives thought.

Number two, is that lots of Americans are suffering from lots of problems.

And maybe it’s kind of nakedly transactional for Democrats to craft a debt relief.

1:48

If plan for student loan holders, who represent just one seventh of the country that is mostly middle-class, or on their way to becoming middle class, this is not a policy that does the most for those with the least.

I thought, number three though, is that politics is transactional Biden promised to do something like this Democrats elected him and now he’s doing what he promised.

2:11

Thought number four is that, yes, he is upholding a promise but he’s not fixing a system student.

Debt is a chronic problem, a chronic problem.

Devising, a one-off solution to an acknowledged.

Chronic problem is kind of weird, like when someone has a back problem, you devise a course of treatment, you don’t write a one-week prescription for painkillers and say, good luck to you.

2:29

Thought number five, is that maybe it’s okay to have a one-off prescription in this case, because student debt was, in fact, statistically an unusually big problem for members of my generation Millennials and younger members of Generation X, who graduated, into an economy in the late 2000s.

2:48

Early 2010’s that was really, really sick that had very little demand that had high unemployment and that happens to be when student debt on an annual basis, peaked, it’s actually been declining since 2011.

So maybe the one-off nature of this policy is totally moral.

3:04

And then thought number six is that maybe I don’t have any standing to deeply criticized this policy and maybe it’s fundamentally immoral for me who has no student debt to criticize a policy that brings everyone else’s student debt figure closer to mine.

Last year, I called this policy student debt.

3:22

Forgiveness.

A b-minus idea in a C+ world.

I think that’s still pretty much, right.

Joining me today in my state of tortured.

Ambivalence is Atlantic writer Jerusalem, Dempsey’s together.

We walk through the best case for, and against this policy, we discuss and occasionally debate the economics, the morality and the politics of student loan.

3:45

Forgiveness, if you have any feedback for this episode or ideas for future episodes, please email me at plain English and Spotify.com.

I’m Derek Thompson.

This is plain English.

4:21

Juice them dim says, welcome back to the podcast.

Hi Derrick.

Thanks for having me since Joe Biden announced his plan to forgive up to twenty thousand dollars of student loans.

For tens of millions of households.

I’ve been pretty overwhelmed by the chaos of the debate over this law and before sitting down and do this podcast.

4:37

I wanted to figure out, like, why is this debate in particular, so overwhelming?

And nonsensical.

And I think it’s because there isn’t just one debate happening here.

There’s at least five different debates.

About this policy that are pretending to be talking to each other.

4:54

You’ve got people debating economic Justice, racial, Injustice Politics, the consumer economy, inflation education financing.

So what I thought we would do here is rather then have a scrum where we pretend to talk about all these things at once we break them down, into their constituent categories, and talk about them one by one.

5:13

So, let’s start first with student loan.

Forgiveness, and the case, for economic Justice.

Now here, I’ve heard two broad classes of arguments.

On the one hand, I hear people who say look student, debt is morally indecent.

No other country has saddled a generation of college graduates with debt like this for committing, the sin of getting a college education.

5:34

But then there’s another group that says, well, you know, debt is a contract.

This was a contract that was taken on knowingly and it happens to be held the student debt by Americans who overall are roughly middle class or have average to above average.

5:52

So wonder do you think one side has the clear Advantage here?

Yeah, I think that both those arguments certainly are being made a lot and I think they’re both kind of wrong and where they’re coming from.

Because I don’t think it’s useful to kind of talk about, you know, the moral valence of debt in the abstract and like whether or not it’s fair or whatever, I think the question is, does this debt allow people to make their lives better or not?

6:17

Right.

So, you know, I took out I think Roughly 30,000 dollars in student loans, to go to undergrad.

That’s all federal debt and my parents not have the money to pay directly for my tuition.

And so I was able to go to school and then I was able to get a job that was good enough to pay pay down that debt.

6:34

And so for me, the BET really pays off, right?

And then there are some people for whom that doesn’t happen.

They either they don’t get a job that helps them do so.

Maybe they don’t finish college and so they don’t get the benefits of an increased wage premium that comes with a college education.

A lot of the time.

So you know I think the The question here is like, not odious debt in the abstract, is that good or bad?

6:54

But like, there’s a reason we’re talking about student loan debt.

And we’re not talking about forgiving, a bunch of bills Mortgage Debt, right?

Because as broadly accepted within the United States that taking on Mortgage Debt is, of course a great bet.

You’re getting to leverage a ton of money that you don’t actually have in order to make a to pay for something you definitely need regardless you have to have shelter and so people don’t talk about forgiving Mortgage Debt in the same way.

7:16

So I think the big question here is just what is this bet actually paying off for most people?

Could someone make the argument that we already do, use federal policy to preference Mortgage Debt?

Because we have a mortgage interest deduction in the federal tax code.

7:34

But on the other hand with student debt, we don’t have similar privileges in the tax code.

We don’t allow student debt to be written off in bankruptcy that while it’s useful to build human capital and move people hopefully between Classes, it’s not treated the same way that other debt is treated and that maybe this policy is a way to rectify.

8:00

That historical Injustice that finally.

Now we are treating student debt a little bit more nicely.

Like we treat other debt.

Yeah, this is one of the weird things with policy debates when people talk about like kind of balancing.

Instead of, like fixing the actual problem, like, yea student debt, should be able to discharge your bankruptcy, and like, we shouldn’t just like, try to make student debt a little bit better in Um, random way you should just fix the actual problem we’ve identified, which is that if you are bankrupt, you definitionally didn’t probably get a good even, get the good benefits that come with a college wage premium that.

8:31

You’re clearly not living the economically, productive life that you were promised after you went to school and so you should just allow people to discharge the debt during bankruptcy.

I think it’s very odd and I think is like a kind of a larger problem.

We have within within politics is when people feel like the actual problem is too difficult to solve or there’s like some political barrier in the way of solving that problem they kind of like nibble around.

8:50

Edges in weird ways and order to kind of direct attack the problem and often, it’s to satisfy some constituency or because they actually do feel bad about the problem that exists but in doing so, they end up pursuing policy.

Aims at don’t actually address the core harm that’s being perpetrated on a population.

9:08

One of the reasons that I struggle with this policy so much and why, as I mentioned at the open, I feel like it’s a c-plus policy for a C+ world is that I think there is a accurate.

Gnosis here, that the way that we Finance public education in this country is really messed up, and that there’s simply too much student debt.

9:28

And that there are reasons why there’s too much student debt.

We don’t have enough local state, financing of public institutions and that as a result that Decline and local and state financing is put on the backs of families.

And students, I think it’s a really useful diagnosis.

What’s weird about this prescription is that we’ve identified a chronic problem for Americans.

9:50

And as a prescription applied, a one-off means-tested cash transfer.

We don’t do this with other problems in America at least typically are ideally like if we say, you know, raising a child in America is too expensive.

10:06

We have to find some way to reduce the cost of raising a child in America.

It’s very strange to say, as a result, what we’re going to do is give 10,000 dollars to every family that happens to have a child between the ages of 5 and 15 today.

And is under 250,000 dollars and next year, we’re just going to stop the policy entirely.

10:25

It’s just a one-year policy, okay?

Well people are still going to have children next year and the year after that.

And the year after that, and in the exact same way, people are going to still go to college next year and the year after that, and the year, after that, and we’re not doing anything with this policy for them either.

I think you’ve actually identified a pattern since we kind of did do this.

10:40

The child tax credit.

We topped it off for like nine months only for 12 months only and We couldn’t pass a set of childcare so your child tax credits.

If you’re entirely right?

Maybe we do just keep identifying chronic problems and applying a cute one off Solutions but to that point maybe just talk about the degree to which this is a very contained problem or excuse me, I should say it contains solution, it really doesn’t do anything for the broader issue of Education.

11:11

Financing.

Yeah, I mean I think that the core issue of college costs being too onerous for folks and then the other Or issue of our people who are graduating from college getting good enough jobs, or actually quite separate from the question of people who currently have debt.

11:29

How do you help those people out?

But we’ve conflated all three conversations together, right?

Like forgiving student loan debt, doesn’t really do anything for people who are having trouble finding good jobs, good paying jobs it doesn’t do anything really for people who are, you know, kind of scared.

It gets sticker shock from the price of College, college, tuition right now and maybe they don’t go to school.

11:50

That would be For them, earlier, labor market outcomes or the fact that we’re not really sure it a lot of places.

Why?

Exactly?

We are seeing such ballooning College costs.

There’s like so many different theories out there right now, but we’re not actually, really sure what the diagnosis is on why that’s happening.

And so, all of these different things are all being kind of put together under the same blanket of quote, higher education affordability and then that blanket, it kind of being addressed on this one off.

12:16

College debt.

Forgiveness.

I mean, there’s one part of this policy of course that We have yet to mention around income-driven repayment which does try to deal with this problem in perpetuity so income-driven repayment.

Basically what it tries to do is it caps, the monthly payment that someone has to make on their college debt at a reasonable level of their discretionary income.

12:36

And you know Biden with this new plan has said essentially that it’s even more generous like even a smaller percentage of your discretionary income from 10% to 5%.

Now your discretionary income can now be Can on when you’re making income-driven repayment payments.

12:54

And so, you know, that’s something that does try to address the problem in perpetuity.

I mean, they’re people have pointed out some issues with this, but I think it is actually attempted to do something about the fundamental issue of the debt burden that people have to carry on.

But again, you’re right does not address the core.

13:09

The core problems of higher education, financing, I think you’re totally right and I’m really glad that you schooled me there in terms of bringing up.

The fact that the child tax credit is a perfect example of how we identify a long term.

Problem and apply short-term solution.

I suppose, the distinction is that right now?

If you look at the terms, the debate, it’s the left or liberals, who are saying, this is a really good policy by Joe Biden and the right saying, it’s a bad policy.

13:31

Where’s the child tax credit?

It was the left.

That was saying, we need to extend the child tax credit, and make it permanent because this is a permanent problem.

People will keep having children and children will be too expensive, given all of these certain inputs for raising a child in America today, whereas, I don’t see enough as much energy right now, in terms of turning this one off solution into a My solution.

13:51

It doesn’t even seem to be that much energy in terms of getting buying to do something.

Blatantly political, like announcing Some Kind of Blue Ribbon commission to say.

We’re going to look into the inputs.

In terms of why education inflation is so incredibly high and we’re going to really figure this out in a bipartisan Manner and come up with all sorts of solutions that can bring pull down tuition inflation over time.

14:11

It does just weirdly seem like a one-off thing you mentioned, education financing.

So let’s talk about that.

Specifically, as you said the ten to twenty thousand dollars of forgiveness is not the only part of the policy that matters.

There is also the fact that student loans are now eligible for this new income based repayment plan.

14:28

Do you worry that the income-based repayment plan, plus the ten to twenty thousand dollars of student loan forgiveness are going to send a signal to colleges that say, keep raising prices.

We’re not going to do anything about those tuition prices.

14:46

That’s the federal government.

We’re not going to do anything about these tuition prices, but we are going On the backend, give your students a bunch of money or limit the pain of holding debt and so you can raise prices as much as you want.

And we’re not going to do anything about it.

15:01

Do you do you feel like it maybe sense colleges and universities that pernicious signal?

Yeah, so policy wonk Matt bruenig makes this argument in a blog post.

So folks who are interested in the in how this will play out, can go read that.

But I think generally kind of the logic of this, right?

15:18

Is if you know, going Into college that all that’s going to happen.

When you take out debt, is that 5% of your discretionary income, will be removed from your, from your paycheck, every month.

And at the same time to that after 10 years, you know?

15:35

It’s you’re not paying anymore, it’s over.

If you know that it doesn’t really matter to you, right?

Like how much money you’re taking out in debt because you’re paying the same amount of money regardless.

And so, the concern here, right?

Is that what you kind of articulated here?

Is that like because students will become more insensitive To the the amount of money they’re expected to take out in debt.

15:55

Then colleges can say, okay, I’m actually going to charge you the full amount student that I previously was giving some sort of discount to or trying to reduce tuition for instead.

I’m going to charge you the full amount because they know the federal government’s going to just give me that much give you that money, and then the college can turn around and create their own kind of income-driven repayment program where they can essentially give you some of that money that the federal government gave them.

16:15

And so that sounds really convoluted.

But essentially what happens is that all that money at the federal government, Has loaned out, just go straight to college coffers and individual students are often not really paying attention to what’s happening, but it allows colleges to continuously raise tuition.

16:31

And it contributes to, of course like ballooning College costs.

And then their beneficiaries of this essentially end up being these colleges and universities and not actually addressing the core problem of college cost.

So I don’t look like a reasonable, you know, there’s a reasonable argument there.

16:46

There are caps on how much money you can take out for student debt.

Based on a variety of things including your like, your parents income and stuff like that, for federal student debt.

So it’s not like infinite.

You catch like take out like invite amounts of money from federal government and also like people do experience sticker shock with prices.

17:02

We do know this from like economic research that people often don’t realize that the about the money they’re paying is not usually the sticker price on College websites.

And so like the idea that the college website would now say like a hundred thousand dollars a year for tuition is not like something that colleges could just do without any sort of cost to the types of students that would be willing to come there.

17:19

And the positions of students would Make and of course, people have just have a general dislike comfort with carrying large debt burdens even if the income driven, repayment thing becomes really common to use.

And so I think there are a lot of reasons to think this won’t be as like as insane.

But I do think it is a real problem.

17:35

And I think that one thing that I’ve heard is that perhaps this will force policy makers to really take.

Seriously the funder, underlying issue of college costs.

Ballooning on the sticker price is ballooning because they’ll be afraid of kind of getting ripped off by.

17:50

ABS in universities here.

So I’m not sure how much stock I put that but people are saying so it’s sort of some people call this like the acceleration estar argument you make the problem of tuitions.

So I bleeding Lee obvious that politicians have no choice but to get together and set up that blue ribbon commission and do something like price controls and college campuses.

18:10

You know, I could say the problem is already pretty.

I bleeding the obvious.

We just gave 15 thousand dollars a way to tens of millions of people, because student debt is so terrible.

But, you know, I think in you did a great job explaining in that policy.

And I just want to be clear about what the outcome of this policy is, if the federal government is encouraged to continue to subsidize universities and colleges, without any kind of price sensitivity, on the part of students, what it means, fundamentally, especially in a high inflation and high interest rate environment.

18:39

Is that you have taxpayers funding governments to pay universities to hire more administrators now, look, I am not against College.

L I think college administrators can be absolutely essential and do some wonderful jobs, but the way this system is going to work out the way it’s going to cash out.

18:59

If the worst happens, if these incentives are followed to their logical conclusion, is that more tax dollars are going to the federal government to hire more and more and more College bureaucrats.

And that’s just doesn’t seem to me like the absolute best use of money in a world where we have very serious problems and where we are somewhat constrained.

19:20

And because interest rates are much higher today and will continue to be higher than they were for much.

The 2000, the 2010s, this is not a world without trade-offs anymore, so let’s actually go to the economic question here.

There’s a consumer economic argument that says that student debt and student loans have for many, many years been holding back.

19:41

The US economy that has kept people from buying houses.

It’s kept people from buying cars.

It’s kept people from taking the job that they really want because they were taking the That was paying them, the most money rather than the one that was the best expression of their skills.

How do you feel narrowly about the argument that relieving student debt?

20:00

Could unleash the consumer economy in these ways and in particular, helped the cause of housing affordability.

Yeah.

I mean, this is something that gets cited, a lot around how canceling student loan debt could boost home ownership and on the margins, right?

Like it makes a lot of sense the argument, right?

20:17

Like, this is a group of people that likely has reasonably High Income jobs.

Like one of the things that might be holding them back from getting a mortgage is that they have this high debt burden that they have to service.

And, of course, just a general, like, you give people money, they have more money, they’ll spend it on other things.

And therefore, one of the things they might spend it on includes house.

20:35

And so, you know, that’s an argument for like just giving people money and like maybe they would increase their, their home ownership rate, we would increase that u.s. is home ownership rate.

Making her a couple things weird about this, like one, like the problem with the housing market right now is that an insufficient?

Amount of demand.

20:52

I mean at least in general like not talking specifically right now but like in general the issue is not that like people.

There are a lot of people who are trying to buy homes.

The issue is as we talked about in this podcast before, Derek, it’s a supply-side problem.

It’s an issue of how much housing availability.

There is where people need it and that the type of housing that’s available actually meets.

21:10

Their needs are there, you know, smaller single family homes are there, you know, homes that have you know, enough bedrooms for their kids and near their jobs that they need to work in.

So like This is this is the real problem with housing affordability and there’s some evidence that in if you don’t actually deal with that, just increasing demand, it does increase potentially the homeownership rate, but it also could raise prices because you are increasing demand for a good.

21:37

While the number of goods is actually pretty stagnant, so that’s kind of a problem there too.

But I think like most broadly here, like, I don’t know which way this plays out like perhaps it increases the homeownership rate, some small amount, But I think the question here is just is this the policy that someone would pursue, if they were actually concerned about whether or not people were able to afford homes.

21:59

If they were concerned about whether people are able to buy the kinds of goods, they wanted whether it’s housing or something else.

I think the answer there is that transparently know there’s one of those arguments it’s like come about because you know someone’s able to run some sort of study and found.

There’s like some small increase in home ownership among people who did not carry student loan debt and people who didn’t care to student loan debt.

22:17

And so, it is not the case at all.

All that if you talk to like housing Economist or housing policy makers, that on the top 10 list of things that they want to have happen in order to increase the homeownership rate, that student loan debt makes an appearance.

So I think that’s one of the one of the weirdest arguments, I hear a lot.

22:38

This leads to the question about inflation.

There was a huge huge debate among Centrist and conservative and liberal economists, about whether or not this policy would increase inflation at a time when we are clearly trying to pull inflation down.

So, on the one hand, there are people who say that there’s already a student loan moratorium, so this doesn’t radically change the status quo, there are tens of millions of people that aren’t paying interest on their student loans and have not been since March 2020 and they will simply Continue to not pay as much on their student loans, after this amount is Forgiven and I suppose that in a few months that moratorium is going to end on the other hand, I didn’t really see.

23:19

I’ve been surprised by the number of liberals who reject the idea entirely that this will affect inflation because right now, you have the Federal Reserve very busy, trying to depress, the purchasing power of Americans, but it seems to me and tell me if you think this is wrong.

23:35

But it seems to me that one of the reasons too.

Forgive student loans is to raise the purchasing power of student debtors.

So why do we think that raising the purchasing power of tens of millions of people won’t raise the overall purchasing power of Americans that a time were trying to destroy demand rather than create it.

23:54

So I don’t think it’s catastrophic, I’m not one of these people who’s like, oh my God, were pouring gasoline on the fire of hyperinflation America.

Like this is the path to Weimer not that at all, not that at all.

But like, at the margin, I don’t understand how this Reduce inflation.

24:09

And so it seems very likely to me to, at least buffer a little bit, the inflationary winds that were trying to cool.

Yeah, so I’ve done a few arguments made by the pro student debt.

Cancellation, folks.

I think it’s one of those anti student cancellation arguments, that’s also quite bizarre that there’s so much energy on it because I agree that like, you know, the net effect of this has to be so marginal.

24:34

Even though the claims that people are making on the side of this will increase inflation or just Very, very small and the reason is because this is not a policy where people are being handed like ten thousand dollars one thousand dollars.

What’s happening is that people are getting know what like a bill is disappearing future.

Imagine someone said like, your cell phone bill is disappearing for the future.

24:51

Like yes, maybe you feel like 75 100 dollars like richer each month, but like for the population of people that were talking about here, that’s not something, we’re all of a sudden, like, you know, your behavior might is that changed drastically.

And you’re gonna be buying a bunch of stuff, like, right now, like heading to your Amazon and and clearing out your shopping.

25:07

Immediately, this is the kind of thing where it’s not really clear to me.

How people end up fully behaving, obviously, they do have their on the margins, their purchasing power is increased.

So like you, we would expect potentially that they would maybe increase more.

But also the population, whose marginal propensity to consume like it’s lower than average.

25:26

Then by that, it means like the marginal dollar that a population gets.

When it’s relatively High income, they are more likely to save it and spend it when compared to people who are poor obviously because if you’re poor, you have a bunch of needs that are not being met.

Currently, but for the population of one of the arguments that the anti student debt, cancellation crowd is made, is that this is not a population that really needs the money and that indicates to me that this is also not a population that’s going to like, go out and need to spend a bunch of money right away either.

25:51

And I, you know, so and I and also the same time, like I think that it makes sense that given that this population is had, you know, a moratorium on payments for a long time.

They’ve kind of normalized to the level of income.

That includes not paying their student.

26:07

Off.

So like, you know, maybe sure this does some little bit on inflation, but it’s as many people have have talked about for the last year or whatever.

The, the focus on inflation is not going to be whether or not like student debt gets cancer or not.

It’s going to be on a lot of other factors that have to do with Supply chains have to offend policy that have to do with other fiscal expansion or contractionary policy is like, it’s just not to me like something that would be focusing on and the fact it’s gotten so much air time.

26:32

As is bizarre.

Yeah, it’s interesting.

I feel I feel like you’re just screwing with me a text.

You’re really, really smart way.

I mean, I try to, I try to like, put both arguments, I’m hearing on the table that the student loan moratorium is already happening and this doesn’t really change the status quo that much.

So why would it have a huge inflationary effect?

26:50

But I do think that you’re right, that thinking about this is a cash transfer is is a little bit strange, because it’s like, it’s almost like an amortized cash transfer into the future, right?

It’s like saying to someone, you’re not going to have to pay your mortgage for 12 months. 12 years from now, right?

27:07

If I said giving someone a bunch of money, that’s not actually going to make contact with their lives as a Sara Lee for many years and as a result is very likely to affect consumer demand in the next month.

I think you’re, I think you’re probably right.

That that’s the right way to think about it and behavioral Economist out there.

27:24

If you guys are take issue with what I’ve just said, because there’s some research.

Please please reach out.

No, I think you’re totally right.

I mean, I I I read I follow a lot of economists who have been analyzing the inflation.

Area effects of this policy and you know the argument that set best with me was this idea that look a lot of people were arguing in 2021 that on the margin.

27:50

One reason to support student loan forgiveness was that we needed a little bit of a bit of a kick in the butt in terms of demand and so this couldn’t hurt.

Not only is it helping people who’ve been overly burdened by bad federal education policy but also we could always use a little bit more.

28:07

Man.

But right now we’re in a situation where we clearly could not necessarily use a little bit more demand.

In fact, we’re actively trying to destroy it and so shouldn’t the argument flip but what you’re saying?

And actually I actually changed my opinion here.

I think you’re right, you’re saying is that I’ll get it might have been wrong from the beginning.

It might have been wrong from beginning that that this policy was going to have almost any effect on sort of month-to-month immediate month-to-month mm.

28:29

And I think it’s probably true.

Let’s go into politics because the political dimension of this I think is very interesting.

I first want to talk about this from the perspective of erratic capital D, Democratic politics.

So on the one hand, only 13% of the country currently carries federal student debt.

28:45

On the other hand that 13% is about 40 million Americans who are disproportionately college-educated like almost by definition.

This is these are student loans, and therefore leading Democratic because college educated Americans have been listing toward the Democratic party for the last few years.

There’s a midterm election, a couple months from now and these 40 million Americans who are overall leading Democratic have just gotten.

29:07

Aliens and billions of dollars going forward over the next few years.

What else should we be thinking about when considering the sort of political strategy behind this policy?

Yeah, I think this is actually the most interesting part of the debate because I think that often people are discussing policy, if there’s like, is this good or bad, thumbs up, thumbs down and there’s not a lot of discussion about agenda-setting and how it happens.

29:31

Like, how is this policy something that we’re talking about?

Why is it gotten to the for when there’s, you know, ostensibly there’s a Million different policy that could have gotten this much attention.

How did this get this much purchase?

I think it isn’t is really interesting.

I think largely, of course, you know, they has to do with the Growing Power of college educated voters.

29:49

It’s not just something within the Democratic party but it is larger than Democratic party that we’re seeing college.

Education explain a lot of who chooses to vote for Democrats and, you know, there’s even been explicit stuff.

I’ve seen like a, you know, Democratic party, communication and staff are tweeted like of course, this is that we’re giving money to our base.

30:06

So it’s just little things like Like clearly.

I’m like, you know, that doesn’t have to be bad.

Like, people want to reward photos to go for them.

Like that’s what you do.

When you get into office, people vote for you into office and then you provide them, the these services and the policies that they asked you to provide.

And that’s not necessarily bad.

I think it just helps explain it.

30:22

The second thing of course is that you know, the Great Recession, I think was a unique phenomenon, right?

And it’s really become like a really big political sticking point for people, which is that, you know, if you graduated college during the Great Recession, like you just got the worst luck imaginable.

30:38

I mean, it was a really bad time to be joining the workforce.

This group of people is now kind of in their Prime entering their Prime like home buying years.

Is it could be blessed, you know, older Millennials who have a lot more voting power now and are a lot more relevant to Democratic Party politics and trust.

30:54

But then before, when they were much younger and this is the group that was, you know, ignored during Occupy Wall Street, that’s where they are now.

Now, they’re much older.

Now, they’re now they’re really relevant to the interest in Democratic party and I think that like the question of like how this plays out Really hard to tell.

I think you see a lot of polls that indicate that people are in favor of this move by Joe Biden, especially younger folks are in favor of this new by Joe Biden.

31:17

I think that it’s really hard to tell.

Because often, when people get asked questions, they interpret them, kind of broadly.

And I think that the one way is that, you know, people here, like, oh, should student debt, be forgiven, and they can kind of hear, like shouldn’t College be affordable for people.

I shouldn’t the American dream.

Be accessible to individuals.

31:32

And also often.

A lot of these polls don’t actually explain the Con arguments, you can get a majority on basically anything to say it.

If you don’t explain to them, the reverse harm of that policy.

And so I do think this is like, probably not popular.

31:48

I don’t think it’s like massively popular or anything like that, but I think probably not popular amongst a group of people that is a democratic party’s base, but I also think that, you know, I think that people are tend to really blow off the unfairness argument because they don’t think it has Merit.

And I’m not someone who thinks we should evaluate policies based on whether someone in the past, did not have access to that benefit or not.

32:07

Generally people get kind of mad when like, you know, something that seems like they worked really hard to avoid whether or not it’s true that it’s based on hard work, but they feel like it’s, they work hard to avoid it is now being given to someone else.

I think it’s just something that’s kind of, like a fact about human nature.

I think there are probably a good amount of people who, who get annoyed by stuff like that.

32:24

But I guess the fundamental question and day is, like, our people voting on student debt relief.

You know, are they voting on this question of whether or not Joe Biden for gave ten or twenty thousand dollars in student debt?

All of evidence indicates that stuff around the economy and increasingly abortion are things that are driving a lot of what’s going on and within the electorate coming up in the midterms.

32:43

It does not really make sense to this would be a big factor but I think the smartest argument in favor of Joe Biden doing this for political perspective has been the idea that you know it helps because General sense that Joe Biden’s getting stuff, done, we have passed, build back better.

32:58

We have infrastructure funding, we have now a promise that he made on the campaign Trail to forgive some student debt.

I mean these are things where you kind of have a general sense that like This is a president Who’s acting in a way that is in favor of my Coalition.

Even if the specific policy itself is not super relevant, there’s one more piece of politics is really interesting to me, which is the way that this policy was created, this is not a law.

33:22

This is not a piece of legislation.

This is a decision by the executive branch and Building Wealth for low-income Americans bringing down the cost of Education, which is the biggest goal here.

That is complicated.

That is Is a long long process.

33:38

On the other hand, canceling student loan debt is a pretty easy change.

It’s a pretty easy thing to do and so Biden could do it, but I wonder if it seems easy now, but it won’t actually be easy to be operationalized because the courts might strike it down.

34:01

Something like this hasn’t really been tried before.

So what is your outlook for the degree to Which this policy even survives the next few months of legal challenges.

Yeah.

So one of the big Arguments for why it was important to focus on this policy.

34:17

It was that, you know, I on a Presley said that it would, it would take just a stroke of a pen to get it done.

This is nothing that has to go through Congress, can be done by the executive, the legal theory that this comes from is from a, I believe that the Yale law graduate who co-founded the debt Collective, which is a non-profit fighting to reduce debt.

34:37

Odin’s student debt also, medical debt, other stuff like that, and basically, it’s like an argument that gets made up in 2017 and I mean I don’t say made up in like a pejorative sense.

I mean, like legal theory that gets developed and it’s quite novel in 2017 by this by this person at the deck Collective and you know it’s not been tested in any way.

34:55

Right.

There’s been some counter argument by lawyers.

I’m not a lawyer.

I’m not really qualified to evaluate the validity of these things but there are quite a few love Fester’s.

Who are very skeptical?

That this is something that will be upheld by the courts especially now that we have a very conservative Court, if it doesn’t seem particularly interested in granting, the executive branch a ton of power to be Innovative.

35:14

I mean, we’ve seen recent rulings and just other, you know, comments they’ve made in dicta that indicate that they are really suspect of the federal government kind of following the sort of legislating process.

Whereas there’s like, a really broad power granted to the federal government by Congress, or than, you know, agencies can kind of just go in and like, do a bunch of policy making that they feel should be left up to Congress.

35:37

That doesn’t scream, Court feels.

That should be left up to Congress.

And so I think that it’s one of those things where it’s not clear, what happens is really novel place.

But I mean, I don’t think Democrats are in a really good position with the courts to, to bank on that they’re going to allow them to do this, kind of Novel Behavior.

35:54

I think it is hard because, you know, at the same time, the court has allowed tons of debt to get effectively canceled by pausing.

The Bottom by pausing, the by allowing present Donald Trump and Joe Biden as well to pause the Student debt payments that hasn’t been challenged.

36:09

And I think one of the really big questions here is like, who even has standing to challenge whether or not the courts can whether or not the executive branch can cancel student debt.

So there’s a lot of really weird legal things going on right now.

It’s not really clear how it’s going to shake out.

36:25

If it does end up going to the Supreme Court, I am not very optimistic this stands.

But yeah.

So we talked about this policy from a bunch of different angles.

We’ve talked about, its economic effects.

We’ve talked about its morality.

We’ve talked about Its effect on the future of Education, financing.

And we’ve talked about its political Dimension.

36:42

I want to close by giving you the stage to tell me what you think, the best case for this policy is and what the best case against this policy is the best argument for is that like the government can do something easily and quickly to alleviate a financial burden on a population of people many of whom would be very helped by that.

37:02

I think the case against is that there’s a there’s a million things that you can be doing and that the government can be doing to help people.

And I am very skeptical about the amount of time and attention that has been taken up by this policy.

And a lot of the arguments in response to my skepticism have been kind of just like, oh but it’s so easy to do.

37:20

It’s a stroke of a pen and that kind of ignores that the reason why there is even this novel legal theory that allows the federal government to consider debt cancellation is because a ton of time and energy and attention were given to this issue to begin with.

And so I think I threw out this podcast, I sound like pretty ambivalent about this.

37:36

That’s because I am pretty.

I’ve learned about this.

I’m pretty ambivalent, because I don’t think that this is something where, if I would order my top 100 policies for the federal government spent time on that, this would place anywhere in there, and I think it’s also true for a majority of Americans.

You know, I talked to gallop earlier this year and they asked this question about, you know, what is the most important problem facing the nation?

37:58

And, you know, this poster told me that they are unable to report the percentage of Americans who have mentioned student debt, or cancellation because it hasn’t garnered enough.

Choose to do.

So.

And that in four, poles, that this guy had conducted in the last year in 2022, which is already hot button.

38:14

Issue.

Only one respondent has ever mentioned.

This is the most important problem facing the nation.

And now, the government does a bunch of stuff that is not the most important problem, not trying to say that this is something where the government should act completely in.

And, you know, ordinary created couldn’t order list of all of the all of the policies that matter.

38:30

But I do think that we should be skeptical in general about the agenda-setting power that we as college graduates have.

And whether we’re using that to To benefit the progressive policies.

We say we are really important or if we’re doing it, you know, just fully out of self-interest which you know, that seems to be what’s going on here.

38:46

Here’s some gems.

This you could read her at the Atlantic.

Thank you so much.

Yeah.

Thanks for having me.

I’m Jerry Thompson.

That was plain English.

Thanks very much to our producer, Devon man.

See if you have any questions comments ideas for future episodes.

Please shoot us an email at plain English at Spotify.com.

39:04

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39:23

Thanks very much.