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It’s Not That Complicated. Cancelling Student Debt Is Good.

The argument that we shouldn’t cancel student debt because it’s unfair to those who have paid off their loans doesn’t hold up. Don’t overthink it: we should cancel all student debt and make public universities, community colleges, and vocation schools tuition-free.

No one should have to think about whether or how they’ll be able to pay back their debts before pursuing an education. And it’s extraordinarily unjust that anyone forgoes the experience completely because of these worries. (Unsplash)

During the 2020 Democratic presidential primary, Bernie Sanders proposed cancelling all student loan debt. The underlying principle was clear. Bernie doesn’t think that student loan debt should exist because he doesn’t think that higher education should be a commodity. No one should be saddled with debt for a service that should be paid for by progressive taxation and made free at the point of service.

New York senator Chuck Schumer is no one’s idea of a Berniecrat, so it’s no surprise that he isn’t on board with Sanders’s idea, but he did recently propose that when Joe Biden takes office he should wipe out the first $50,000 of student debt for every borrower by executive order. By the time the president-elect himself chimed in with a version of the plan, it was watered down so much further that it read like a cranky leftist’s parody of what a centrist president would do. “Up to” $10,000 are canceled under the Biden plan, but — wait for it — only “private, nonfederal” student loans. Oh, and the whole thing’s going to be means-tested.

Yet even this considerably-less-than-half-measure was enough for the resurgence of the argument that sparing graduates currently hobbled by student loan debt would be unfair to those who had to go through the same ordeal in the past. Let’s break that down.

Fairness and Restitution

The first thing to notice about this objection is that it would apply to any reform that makes people’s lives better in the present. If we passed Medicare for All, no one from that point forward would have to pay for private health insurance premiums, co-pays, or deductibles again. Would this be unjust to everyone who had to pay through the nose for all of these things in the past?

Or think about all the states that have legalized recreational marijuana. Is this unfair to all the people in those states who had to pay fines or serve time in prison for possession in the past?

It would certainly be unfair to keep people who hadn’t finished their sentences yet in prison after legalization. (This would be the equivalent of ending tuition without providing relief for people who were still struggling to pay off their loans.) But even there it’s important to make a basic distinction. The unfairness of keeping people in prison for what was now legal would be a reason to free the prisoners. It wouldn’t be a reason to keep marijuana illegal going forward.

If a monster lives at the edge of town and makes a regular practice of eating bits and pieces of passersby, and after this goes on for years before the town finally brings in a monster hunter to put an end to it, do the people walking around with missing fingers because of past monster attacks have a legitimate complaint? In one sense they do, and in another they don’t. It was unfair to these past victims that it took the town so long to bring in the monster hunter. It’s not unfair that they’re finally taking care of the problem.

Money can’t make up for missing fingers, but it might still be reasonable to financially compensate the past victims of the negligence of the local government. But what if we sharpen the example and have the monster kill its victims instead of just eating the occasional finger? There’s no way to make restitution to the dead, but it would be (ahem) monstrous to treat that as a reason to let the monster continue to eat people now.

After any reform is passed that ends an injustice, an abstract moral case can always be made for some form of reparations for past victims of that injustice. In some cases, it might make sense to actually do this. In others, it might be impractical or even impossible. But whether it’s reasonable or possible to compensate people who have suffered in the past, that’s never a reason not to end an injustice in the present.

Cancel it All

Thinking about what’s wrong with the “unfairness” argument can help us understand what’s wrong with the two other most common arguments against student loan cancellation — that cancelling the debt would be “regressive” and that it would create a “moral hazard” going forward.

The “regressiveness” objection is that the population of borrowers is richer on average than the larger population of non-borrowers. This is true as far as it goes. While the least privileged students often have to take on enormous debt and have more trouble than other borrowers paying it back, it’s also true that most poor people don’t even try to go to college because they know that it’s too expensive.

There’s also some truth to the “moral hazard” concern. A student loan jubilee now would give students in the future that have to take out loans to finance their educations some reason to be hopeful that their own burdens will be relieved later. Cancelling current loans without doing anything about the underlying problem perpetuates the cycle of students taking out loans and struggling to ever pay them back.

But neither of those give us a good reason not to cancel current debt. Instead, they give us an excellent reason to create a fair system of higher education going forward — meaning that we should make public higher education, community colleges, and vocation schools tuition-free (and nationalize elite private universities while we’re at it). No one should have to think about whether or how they’ll be able to pay back their debts before pursuing an education. And it’s extraordinarily unjust that anyone forgoes the experience completely because of these worries. We need to cancel every penny of current debt and eliminate tuition so no one ever has to take out another loan again.

It might not be politically possible to carry out all aspects of this program in the next few years. If the GOP controls the Senate, Joe Biden will have an ironclad excuse not to try to eliminate tuition across the board — or even to try to carry out his campaign promise to eliminate it for students at two-year colleges. But none of that adds up to a reason not to carry out the part of this agenda that Biden himself admits can be handled by executive order.

If he cancels the first $10,000, he’ll have forfeited his excuse for leaving the rest in place. He needs to cancel it all.