Why I'll repay student loans even if Biden cancels them | Mullane
If President Biden cancels the nation’s $1.75 trillion college student loan debt, there’s one guy who’ll still pay it back ― me.
It’s not that I couldn’t use $20k, which is the balance on my wife’s grad degree. We have a shabby kitchen last redone during the first Reagan Administration, and I could stock a slideshow with pics of all the low-end, high mileage clunkers I’ve driven over the last 20 years. When a neighbor’s teenage daughter accidentally backed into one of my rust buckets last summer, all I could do was laugh and say, “You put a scratch in one of my dents.”
But I digress.
I’ll repay the federal loans because that was the deal we made with Uncle Sugar. We knew the terms and understood the risk, at 6.8 percent interest.
In my house, we piled student loan debt on top of mortgage and other debt due to the battering we took during the Great Recession in 2008. Mrs. Mullane lost her job, and my employer gave me a 10 percent haircut on my salary. Our finances were tighter than a Kardashian’s red carpet getup.
My wife decided to switch careers and teach, but the job she wanted required a masters. The program was outrageously overpriced, as is all college tuition. There was no guarantee she’d get the job, and if she didn't, we’d be stuck with debt we could barely service. Every financial scenario said, “Don’t do it.”
But we’ve been in tighter spots. Plus, we’re melting pot Americans with an abiding faith in the promise of this great country, which rewards optimism, ambition and hard work. So we threw a Hail Mary and got the win. Hail Marys and a belief that things will work out have always done us right.
Today we’re fine. We can repay the debt, take vacations and drive better cars. The open secret is so can the people who hold most of that $1.7 trillion in student loans.
It’s remarkable that the college debt crisis gets so much press, given that just 13 percent of the country owes on student loans. Gallup, the polling outfit, reports that in four surveys on the “most important problems facing the country,” only one respondent said college debt.
That guy is probably a CEO making good money.
MullaneWeedishness in Bellmawr N.J.
I say that because the University of Chicago studied who’d benefit most from loan forgiveness and, surprise, it’s affluent, college-educated professionals, who owe almost 60 percent of all U.S. college loan debt. They took the bigger loans, got the better paid jobs and can afford to repay the dough they borrowed from the federal treasury.
The report concludes: “We find that (college loan) forgiveness policies are highly regressive, with the vast majority of benefits accruing to high-income individuals.”
By “regressive,” they mean it will hurt lower income Americans, say, the people who tend the CEO's lawn, detail her Tesla, manicure her nails, haul away her trash, and daycare her kids. The affluent professional class, with c-suite career aspirations, offload their college debt onto the worker bees that their corporations employ on the shop floor. The bees pay for it in higher taxes and chronic inflation.
That’s the bigger reason I’ll repay. College debt forgiveness, even if Biden settles on just $10k per loan, sticks it to every non-college worker. Though I have a college degree (a Temple Owl) the working class and blue-collar middle class are the people I know and love best. They’re my friends, my in-laws, my family. My oldest kid is an electrician.
College debt forgivenessWhite House considering an income cap for student debt forgiveness plan
During the Great Recession, the political class spent $700 billion of our dough bailing out bankers (remember TARP?) who were losing their French-cuffed shirts on their reckless, corrupt investments. But there were no bailouts for Levittowners losing their homes to foreclosure from banker-induced recessionary job losses. I went to the county sheriff's auctions. People cried. I wrote about it.
Critics (like me) repeated a line back then: Corporations privatize their profits and socialize their losses.
That’s the practical effect of Biden’s college loan forgiveness, given its biggest beneficiaries. Affluent college graduates privatize the profits of their well-paid careers, obtained through government loans, leveraged to acquire their college credentials. But they socialize their chunk of the $1.75 trillion to Levittown, Pa. and Willingboro, N.J. and places like them.
I don't oppose all college debt forgiveness. The terminally sick, disabled vets, the working poor. I’d be happy to discharge their student loans. Also, I'd forgive the loans of working stiffs who, sold a "pursue your passion" bill of goods on college, borrowed $40k, $50k, $60k for a degree that, taken to the job market, rewards them with $15 an hour in retail.
Discharge that kind of predatory debt back to the colleges and universities responsible. If we can confiscate the yachts and property of foreign oligarchs profiting from war, we can raid the billions held in endowments by universities profiting from the sale of worthless degrees.
Should Biden zero out student loan balances, I'll just pay it into my kids' IRAs, which they've had since last year. Like the Trump/Biden COVID stim checks, it's not my money, it's theirs. If they continue to save and invest, in 40 years they'll have a million bucks, maybe $2 million, and have the option of early retirement.
Do they teach that kind of math in college? Probably not.
Columnist JD Mullane can be reached at 215-949-5745 or at jmullane@couriertimes.com. Follow him on Twitter @jdmullane.
This article originally appeared on Bucks County Courier Times: Why I'll repay student loans even if Biden cancels them | Mullane
