So many events unfolded while this semi-humble blogger was on respite… so many currents events that attracted a little more of my attention… from various legislative priorities, to the death of those such as the iconic Olivia Newton John (“Grease” is still the word), to House Speaker Nancy Pelosi’s significant trip to Taiwan. Please, no disdain nor hurrah for the Speaker’s travels. As one who has actively studied State Dept. and academic analyses in the past year regarding Taiwan independence and its history with China, this is a most nuanced issue. It’s a hollow argument to suggest said act was all good or all bad; it’s complicated. But alas, that seems what 21st Century political activity has oft succumbed to — this notion that an act or stance is all good or all bad. We are thus oft hollow. Oft unknowingly so.
One of issues, no less, that arose while away is Pres. Joe Biden’s decision for the government to repay a nominal portion of outstanding student loans. Thanks to the many who have already, preemptively dialogued with me… some in celebration… some in disgust… and some still a little more balanced — thankful for the aid in their personal predicament but aware of the greater economic effect.
It’s been fascinating to watch play out…
Via Executive Order (meaning no congressional involvement), Pres. Biden announced a plan where individuals making less than $125,000 annually — or households under $250,000 — are eligible for $10,000 in federal loan forgiveness. (Those with outstanding Pell Grants would qualify for more.)
Biden authorized such based on the 2003 Heroes Act, a law which gives the Secretary of the Dept. of Education the authority to waive debt obligations amid a war or national emergency. That law was crafted to care for veterans fighting in Iraq and Afghanistan after 9/11.
Regardless then of legal precedent in addition to individual choice, responsibility and current ability to repay — and also infusing more money into an already inflated economy — this was a unilateral decision. Just last year, Speaker Pelosi, who shares the President’s party, said that Biden lacked the power to make such a decision unilaterally. “It would take an act of Congress, not an executive order, to cancel student loan debt,” said the Speaker.
Hearing the reaction of many, most in support base their advocacy on either (a) their trust of Pres. Biden and his party or (b) how it affects them individually. Most base their disapproval based on (a) their distrust of Pres. Biden and his party or (b) their greater understanding of economics. It is the most expensive Executive Order ever, with estimates from the mid-hundred billions to $1 trillion, according to the Penn Wharton Budget Model, a nonpartisan, widely regarded analysis. To be clear, debt cancellation is not free; the federal government has to pay that money. Taxpayers fund the federal government, and those taxpayers include the millions of men and women who made the decision to attend a trade school, no school or less expensive school, knowing the potential cost to be incurred.
The other reality is that the bottom line issue, in my opinion, is the exponentially increasing cost of a college education; it’s an unsustainable financial burden for future generations. However, this Executive Order, as multiple prominent Democrats and Republicans concede, does not address that issue. The bottom line problem will remain the bottom line problem.
So why? Why do it? Why craft this Executive Action now?
I’ve heard all sorts of reasons. And let me be bluntly honest with you. I don’t know…
A promise? A bribe? Win more to a side?
Midterms? More?
With multiple holes in the reasoning, let us again respectfully ask: why do it now? Some warn it will continue to increase inflation, as the plan equates to even more money chasing still too few goods. Let me suggest, however, that such an impact is difficult to precisely predict; inflation depends more on how consumers change their spending habits as a result, and student loan repayment has been suspended for some time.
So again, let me claim not to know the convincing rationale. I’m grateful several of my friends will find some relief. I’m also sarcastically snickering that several other of my friends making $100K plus will now have their leftover loans paid off by you and me. The bottom line seems the decision makes ambiguous, inconsistent sense.
I will thus add that one of my benchmark standards of living is to act in a way above or beyond reproach. In other words, prudent behavior means acting in a way that criticism isn’t so obviously called for. One might disagree with our decision-making — they may, in fact, do so adamantly — which party loyalists do with regularity — but they understand the decision-making; there is no inconsistency in the logic. This Executive Order — like it or not, benefitting from it or not — doesn’t stand up to said benchmark.
It makes me think of the incredibly brave Rosa Parks — brave in so many contagious, historical ways. Said Parks, “If you want to be respected for your actions, then your behavior must be above reproach. If our lives demonstrate that we are peaceful, humble, and trusted, this is recognized by others.” And we wonder why our government, on all sides of the aisle, struggles with being respected and trusted. Maybe we should learn anew what it means to be above or beyond reproach.
Respectfully…
AR