|
Eakinomics: Student Loans (Again)
The worst kept non-secret in domestic policy is progressives’ desire
for the president to forgive every cent of student loan debt owed to
the federal government. Eakinomics is exhausted by the illogic of
this proposal and is walking around with a student-loan blood
pressure of roughly 200/110. So, it is probably not a good idea to
get into forgiveness again, but here we go.
There is in the student loan world the notion of a borrower defense
to repayment (“BDR”) claim, in which a borrower requests the
discharge of his or her loans based on alleged misconduct by the
school the borrower attended. Since 2019, the Department of Education
(ED) has been the defendant in a class
action lawsuit brought to force ED to process BDR claims
because it had ceased consideration of BDR claims altogether.
That’s right. The Department of Education had simply stopped doing
its job. The plaintiffs sued to force ED to do its job. That’s it.
Now it gets interesting. As is not uncommon, ED decided to settle the
suit and end litigation. But rather than settle by meeting the
plaintiffs’ request, it went way, way, way further. It decided to
presumptively assume that anyone
who attended 153 colleges implicated in the suit had been subject to misconduct
and will have their loans forgiven. Everyone.
Sometimes an act serves its purpose. Occasionally, you get a
“two-fer” that satisfies two goals simultaneously. But very rarely
does one see the infamous policy trifecta. But here it is. First, ED still doesn’t have
to do its job. Never did it, never will. Just fabulous.
Second, it provides loan forgiveness of at least $6 billion – and who
knows how many more attendees will come out of the woodwork? – via
the legal settlement and without a stroke of the president’s pen. It
will take more
to satisfy the progressive left, but $6 billion is still real money
in some circles.
Finally, it just happens that all 153 colleges are for-profit
institutions. The left’s enmity of the for-profit sector is
legendary. It must be terribly satisfying to have them legally
labeled as presumptively guilty of misconduct.
One can only pray that at some point in the future the same amount of
energy and creativity is devoted to actually fixing the student loan
program as has been expended to help borrowers abuse it.
|
No comments:
Post a Comment