The Great Education Wealth Transfer
It may come as a surprise, but leftists’ push for “free” education is just an elaborate plan to line their own pockets.
Whether it’s a giveaway or a debt forgiven, something that’s free releases the one holding an obligation from responsibility in contrast to ownership. And that, ladies and gentlemen, is the appeal of socialism as repackaged and sold to today’s generation — the release from responsibility.
The University of Chicago’s Becker Friedman Institute of Economics has just published a study that reveals the beneficiaries of this massive entitlement initiative are not the poor. The authors observe that “high earners took larger loans,” meaning that Joe Biden’s trillion-dollar loan “forgiveness would benefit the top decile as much as the bottom three deciles combined.” As for race? “Blacks and Hispanics would also benefit substantially less than balances suggest.”
The study goes on to expose more flaws: “Much of the public discourse misses the fact that significant targeted debt forgiveness already exists. … Importantly for most borrowers, Income-Driven Repayment (IDR) plans offer substantial loan forgiveness to low-income borrowers. … IDR plans link payments to income, so borrowers with persistently low incomes will only reimburse a fraction of their debt before it is forgiven.”
That’s right. Programs already exist to assist low-income individuals who cannot pay their college debt, yet those who take out big loans are the ones who’ll benefit the most from the Biden-Harris plan. In his 2020 presidential campaign, President Biden committed to $10,000 in debt forgiveness per student. Now, with both chambers of Congress in the hands of Democrats, the push is to increase that to $50,000 per student.
Funny enough, data show that as financial relief and aid to students increases, so do the tuition costs. That bears repeating. As access to funding becomes easier, so do the rising costs of tuition at for-profit institutions. Shocking, we know.
Both Harvard University and the National Bureau of Economic Research have published research replicating the science that, to quote the Harvard paper, “aid-eligible institutions capture part of federal aid by increasing tuition above the cost of education.” Put simply, to get more funding, prices are raised.
So, why don’t we just give away money for college so there’s no debt to anyone?
In the junior college or technical college space, this argument has more standing as individuals are trained for entry-level work or seek skills training for a specific trade or vocation. According to a McKinsey study, nearly half of graduates from four-year institutions are working in jobs that do not require a four-year degree, yet Bernie Sanders, Elizabeth Warren, and the rest of the Democrat Party are still demanding a College for All plan featuring a massive price tag.
What did the father of socialism, Karl Marx, say about free tuition? Writing for the Australian Financial Review, Bruce Chapman quoted the Communist: “If in some states … higher education institutions are also ‘free,’ that only means in fact defraying the cost of education of the upper classes from the general tax receipts.” Again, the benefit of “free” doesn’t reach the stated group of lower-income citizens.
Democrats see the transfer of wealth and the growth of government as a solution to any problem, making Americans more and more dependent upon the government — and more likely to vote Democrat. But the problem with excessively priced tuition is not solved by forgiving debt through the transfer of wealth or making these tuitions “free.” If funds are given for education, they should be given based on income and provided directly to families, who can then select the institution of choice from kindergarten through college.
Just imagine being free to make an educational choice that fits your child, your college student, or you as an adult learner. Now that’s free.
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