Posted on 08/29/2022 8:39:40 PM PDT by jfd1776
The news of the week concerns the Biden-Regime’s $10,000/student (or in some cases, $20,000/student) loan write-off, being portrayed as a debt forgiveness.
It’s not.
Today, let’s consider some of the basics that the debate has forgotten – basics that involve not only the schools, the banks, and the students, but the taxpayers, the economy, and civilization itself.
Advance warning: this is going to be a long one; it's a big topic.
MORAL HAZARD
Think of the famous concept of the “butterfly effect” – the idea that every action might be a cause of other, possibly unanticipated results down the line. When a pundit or economist refers to “moral hazard,” he means that the proposal on the table will likely cause even poorer choices in the future, leading to even more destructive results.
- If the problem at hand is caused by people taking on loans they can’t or won’t repay, then forgiving them will cause more people in the future to do the same.
- If it is caused by banks (or in this case, government) foolishly extending unsecured credit beyond any anticipation of full repayment, then those banks (or in this case, government) will continue to do so, jeopardizing our very economy system.
- If it is caused by colleges and universities already setting the costs of tuition, books, and room and board too high for people to afford, then this “forgiveness” encourages these colleges and universities to continue to set these costs irrationally high in the future.
In short, the moral hazard argument is that the proposal on the table not only doesn’t solve the real underlying problem, it’s worse than that: by rewarding bad behavior, the alleged solution will actually cause the underlying problem to worsen.
(Excerpt) Read more at illinoisreview.com ...
lets start a gofundme to pay off student loans
and see how many LEFTY loudmouths pony up
short version
its unconstitutional
This is a perfect example of how stupid the Biden occupation is. They are bribing people who already will vote for them, most college students today are indoctrinated leftists. So basically all they are doing is ticking off democrap voters who never went to college or are in debt for things other than school. Thanks Joe!
“...the alleged solution will actually cause the underlying problem to worsen.”
That is the democrat way.
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