Student Debt

 Whispers are that Biden is going to move on easing or cancelling student debts.

I'm ambivalent.

On the one hand, the nature of student debt is that it is both large and falls on the young disproportionately. So you have people who are making less money than they eventually will - because they have degrees - who are leveraged. 

It's also a clear demographic that Democrats need to win elections, but one that has a spotty history of actually turning up to vote. At this point, Biden and Democrats have trapped themselves because they've paused student debt payments. If they resume before the midterms, younger voters might stay home. So from a demographic stand point, you want to reward your voters.

On the other, they hired the money, didn't they? While student debt is a huge number for the population, it averages around $30,000 per person. So the individual benefits are going to be smaller than people think, but there's another problem. Inflation. A primary policy goal must be to corral inflation before it becomes a spiral. Stimulating the economy is the last thing we need to do right now. Inflation hurts everyone at the current rates, including those who will get debt relief. 

There's at least some pushback from those who didn't take student loans and those who paid theirs off. Some of this is tied to just being selfish, which is a pre-existing condition for being a Republican anyway. Still, there could be a political cost to a student debt "jubilee."

Personally, I think Biden should cancel the interest on the debt with a promise to consider debt forgiveness once inflation is under control. The lack of interest will help, and get debtors out from compounding the principle. The promise for future debt relief might incentivize younger voters to get out and vote, unless they are being petulant little shits for not getting everything they want NOW.

As I said, I'm ambivalent. I think Biden has trapped himself by pausing debts. He can't un-pause them before the midterms, but forgiving them has a greater cost than people will admit - both politically and macroeconomically.