Guys there is a bigger agenda at work here. Student loan forgiveness is about making college free.
Of course it is, and that's one reason why I think it would be a good idea for Republicans to get ahead of this issue while we still have time.
Massive student loan debt is a very real, very serious issue that affects the entire American economy. No one who seriously looks at the data can draw different conclusions. We can definitely debate the reasons for it, etc., but it exists, and there's no denying that it exists.
The market has no solutions for this problem because, unlike other loans or business ventures, there is no safety valve for insolvency (bankruptcy). The ethics of bankruptcy can be debated, but bankruptcy does provide a tool in desperate times to financially "restart" from bad investments, bad decisions, etc. But for student loans, it's not like you can structure an LLC and make only business assets at risk if your small business fails. They simply don't go away except in some very specific situations.
And federal student loans also don't have the market-based risk prevention on the front end that would be able to make lending decisions based on credit risk and ability to repay. This, of course, is why they cannot currently be included in bankruptcy, as that restriction is intended as a backstop to offset the lack of underwriting prior to loan origination.
Some of that "offset" on the back end is likely based on the accounting rules of the Congressional Budget Office that don't allow for a fully accurate assessment of risk. It looks better on paper than any objective person would expect it to be in reality. So the effect on the budget is masked.
So we have government-originated loans that have no risk assessment on the front end and illusory risk mitigation on the backend. This is just about as far away from the free market as one can get.
Maybe there is a greater role for taxation to play in higher education funding. That's a separate discussion. But student loans as they currently exist constitute disastrous policy. And even Trump's proposed reforms are barely more than treating cancer with essential oils.
The "conservative" case for addressing the student loan crisis is that we need decisive action to get rid of the problem that terrible (albeit possibly well-intentioned) government intervention created. If conservatives don't address the problem in the very near future, we may risk allowing the problem to become so bad that even full-blown socialism would seem appealing to the average American, if only to get relief from this crisis.
