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Notes -
The student loan subject, but in the opposite direction. I find it absolutely infuriating, I think people that want me to pay their willingly incurred debts are greedy and untrustworthy. I wrote more about why I think it's [so wrong here] (https://old.reddit.com/r/TheMotte/comments/kcsx2u/culture_war_roundup_for_the_week_of_december_14/gg9ijd4/):
On student debt forgiveness, I'm seeing the emergence of a new framing that seems almost completely nonsensical to me. In a recent Voxsplainer, this quote is included from a policy person:
“What’s attractive about student debt cancellation in this moment is that in addition to righting a policy wrong — which is the decision to make the cost of college an individual burden when I would say it’s a public good — is that it can help stimulate the economy at a moment when we need economic stimulus. And it has significant racial equity implications as well,” said Suzanne Kahn, director of education, jobs, and power at the Roosevelt Institute and an advocate for complete federal student debt cancellation. It’s also something Biden could try to do independently of Congress, which is attractive since stimulus talks have stalled out.
I want to emphasize the use of "public good" there - this doesn't mean something that's good for the public, this is a specific economic term used deliberately. The meaning is:
In economics, a public good (also referred to as a social good or collective good) is a good that is both non-excludable and non-rivalrous.
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Non-rivalrous: accessible by all whilst one's usage of the product does not affect the availability for subsequent use.[8]
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Non-excludability: that is, it is impossible to exclude any individuals from consuming the good.
This is not at all what university educations look like. Not only are degrees both rivalrous and excludable, they're also positional goods that convey signaling benefit to their recipients. To make them non-rivalrous and non-excludable would substantially remove their value to the individuals receiving them. We can imagine a world that looks like that, where Harvard offers all of its classes online to anyone that would like to take them and anyone that signs up and passes receives that Harvard degree, but that looks nothing like the world we actually live in.
From my perspective, student loan forgiveness would be one of the worst policies in American history. It would:
Reward irresponsible people that had no plan to pay debts freely entered into.
Reward universities that conferred expensive degrees that don't have an actual return on the investment.
Reify moral hazard and perverse incentives related to the above.
Continue to inflate college costs due to the expectation that no one actually has to pay for anything.
Further the class/social war by explicitly choosing to extract from non-university labor to reward the formally educated.
Almost all of the upsides seem to me to be incredibly short term and ignore normal human reactions. To me, the justifications all look like sophistry in service of smash-and-grab politics.
They're just using "public good" as an applause light, more in the plain meaning of "something good for the public" than the economic term, although they are attempt to borrow the legitimacy of the economic term.
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