It takes a pillage

Among the most guileful, if transparently self-serving, arguments I’ve heard in favor of spreading student debt to every taxpayer – from a youngster whose degree was fully financed by parents – is that wiping the student slate clean would benefit everyone because of the important contributions student debt ‘victims’ could make if they no longer had to worry about the burden of holding up their end of freely signed contracts.

Freedom from the indentured servitude they accepted would enable them to more quickly apply their elite credentials and superior expertise, contributing to the welfare of society. Translated, this means they can get on with their lives: Borrow money to start a business, buy a house, start a family, afford a planet saving electric car, contribute to the most enlightened charities, vote for more spending… The simplest formulation is, “If we get to be looters, we will become better makers quicker than anyone else. And everyone gets a share!” (Apologies to Milo Minderbinder.)

I do not know how Equity of the implied redistribution is assured, and I assume Equity is very important. Maybe a new Federal Department?

This same ingenue has been heard to argue that we needn’t worry about government spending in any case, because we are on the brink of marvelous technological advances which make the at least half trillion dollar cost of spreading student debt to everyone else look like spare change.

This explosive growth of wealth theory is interesting enough for another long post, but I do have some questions to mention here.

In the context of the student loan pillaging, the minimum increase in general wealth would have to be substantially more than half a trillion. For example, we need to account for all the small businesses that wouldn’t be started because some taxpayers won’t be able to afford it; or a down payment on a house. Etc..

So, if the starting point is north of half a trillion dollars, what is the limit to spending we should consider? Is there any? Are we into full MMT? How much debt will be erased by this unprecedented expansion of wealth?

It seems to me we should minimally aspire to eliminating the national debt, and establishing true trust funds for social entitlement programs. Including a contingency fund for things like reparations. Again, what’s the limit on current spending if we assume such miraculous future growth?

This news is so good, and so imminent (arguably it must occur withing the span of a single generation) that I have to wonder why we just don’t wait for it to happen. And THEN pay off the student loans. Or, better, let the people who incurred the debt pay it off with their new found wealth.

OK. I conflated arguments which appear not strictly meant to be taken together. But there is a direct line between freeing the potential of these embryonic John Galts and economic nirvana. Expecting consistency in such ideas isn’t unreasonable. If we’re going to accept “the elite will contribute more than it costs” argument, it’s fair to ask how much faith we can put in the overall economic acumen of the bright young people who are proposing it. Who are preparing to become stewards of the economy.

The bottom line is that looting of taxpayers on behalf of students will damage the economy. Even if you accept the “benefits everyone” argument, those benefits are not immediate. Let’s just let the people who benefited from the loans they took (because they thought they would benefit financially) pay them off. As a bonus, not paying them off via taxation preemptively reduces the national debt by at least half a trillion dollars.

However, perhaps you find economic arguments insufficient. And you consider the question of fairness to those who responsibly discharged their student debt to be irrelevant… Let’s take a look at legal objections and precedent.

A major argument for proponents is that a Presidential executive order is legal under the 2003 HEROES Act. Randi Winegarten certainly doesn’t see any legal barrier:

If you can take the word of a person responsible for closing classrooms that she’s concerned about “our students” you might consider that what she means by “our” is ownership, not stewardship. She does not mean students under care and protection, she means revenue bots.

IAC, she’s wrong, no matter how manic.

Let’s see what Congress intended and examine the law itself (links omitted):
Congressional Records Prove Biden’s Student Loan Cancellations Are Illegal

The HEROES Act of 2003 was sponsored by Republican John Kline of Minnesota, who had served 25 years as a U.S. Marine. When he introduced the bill in the House of Representatives, he declared that it would help “the troops who protect and defend the United States.”

At that time, many college students and recent grads who were members of the National Guard and Reserves were being deployed to carry out Operation Iraqi Freedom and anti-terror operations in response to the slaughter of 2,977 people on 9/11.

Stating that the bill was “simple in its purpose” and “specific in its intent,” Kline explained that it will “assist students who are being called up to active duty or active service” and those who are impacted by “a war, military contingency operation or a national emergency.” He also emphasized that the bill would do this “without affecting the integrity” of student loan programs.

Demonstrating just how simple and specific the bill was, the official legislative record shows that the House of Representatives passed it by a vote of 421–1 with only “forty minutes of debate.” The Senate then passed it “without amendment by unanimous consent.” If all 100 senators were present, this is a margin of 521 to 1.

The Penn Wharton Budget Model estimates that Biden’s student loan cancellations and payment reductions will cost $605 billion to more than $1 trillion over the next 10 years. This amounts to an average cost of roughly $4,700 to $7,700 for every household in the United States.

The Biden administration claims that the HEROES Acts of 2003 gives them that power, but Congressional records prove just the opposite is true. These include the introduction of the law, the debate of the law, the votes on the law, and the text of the law.

Moreover, the Supreme Court has repeatedly affirmed that unless Congress clearly delegates such powers to the president, these types of actions are illegal.

There’s more. Even Nancy Pelosi knew it would be illegal before she stopped knowing it

A Legal Reckoning on Student-Loan Forgiveness

If the Court cannot stop the president from raiding the Treasury to buy votes and reward friends on the most implausible of legal pretexts, what is it for? A majority of the Court appears to recognize that the HEROES Act does not grant the power in question — a reality that even Nancy Pelosi acknowledged until it became clear that Biden intended to act when he could not get such a plan through Congress.

The statute says that the secretary of education can “waive or modify any statutory or regulatory provision applicable to the student financial assistance programs” when “necessary in connection with a war or other military operation or national emergency.” Chief Justice John Roberts set the tone for the argument by noting that Justice Antonin Scalia once observed that “modified in our view connotes moderate change. He said it might be good English to say that the French Revolution modified the status of the French nobility, but only because there’s a figure of speech called understatement and a literary device known as sarcasm.” Moreover, the chief justice observed that, even if terms such as “waive or modify” could be construed to encompass the outright cancellation of student debt, the Court’s “major question doctrine” requires more — namely, a citation to “clear congressional authorization” of the specific action taken by the administration. No one can plausibly claim that the HEROES Act even anticipated, much less green-lighted, half a trillion dollars in relief to a favored class of debtors without additional congressional input.

The entire idea was a Democrat political ploy prior to the mid-terms.

No, the HEROES Act Doesn’t Let Biden Forgive Student Loans

Biden has justified spending such an incredible amount without first obtaining congressional approval by invoking the HEROES Act, a 9/11-era law designed to allow the federal government to provide student debt relief to soldiers who were forced to withdraw from college to enter active duty. Under the HEROES Act, the Secretary of Education is granted the authority to waive “any statutory or regulatory provision” relating to student loan repayment or assistance programs during a time of “a war or other military operation or national emergency.”

The legal ground justifying Biden’s student loan relief plan has always been shaky—and obviously politically motivated. As higher education expert Mark Kantrowitz told CNBC earlier this month, “If it was an emergency, why wait three years to provide the forgiveness? Why present it in a political framework, as fulfilling a campaign promise?”

Finally, let’s not forget who promoted this problem. Student indebtedness owes most of its problematic nature to debt encouraging Federal programs and the use of that easy money to fund the explosion of a diversity/inclusion/equity (DIE. AKA DEI) Administrative cadre in our universities. WE HAVE TO DO SOMETHING is a quintessential example of government causing a problem for which the ‘fix’ is more government intervention.

Damn the law. Full speed ahead.

Update 03/04/20 10am – removed duplicate paragraph

American school children and Russian cows

If You Send Your Kid to Private School, You Are a Bad Person

I am not an education policy wonk: I’m just judgmental. But it seems to me that if every single parent sent every single child to public school, public schools would improve. This would not happen immediately. It could take generations. Your children and grandchildren might get mediocre educations in the meantime, but it will be worth it, for the eventual common good.

When Allison Benedikt says “worth it,” she is insisting that you consider all other children more important than your own child. Those of a totalitarian disposition might consider this idea worthy of debate, but, short of government forcing it, no one could consider it practical. Even president Obama has rejected Benedikt’s dictum.

One wonders how Progressives like Ms Benedikt reconcile their relentless public school focus on self-esteem training with their opinion that the collective is more important than you are. You’re special because your parents decided to sacrifice your education to the common good? You’re just as important as everyone else who can’t read or write?

It reminds me of an old Russian joke about a peasant with one cow who hates his neighbor because the neighbor has two cows. A genie offers to grant the envious farmer a single wish. “Kill one of my neighbor’s cows!” he demands.

Ms Benedikt is not arguing on behalf of children, or the “common good.” She’s arguing on behalf of public employee unions and big government, so ignore this report from Harvard: Students Learn Less in States with Stronger Teachers’ Unions

For Ms Benedikt that’s not a bug. It’s a feature. Of course, she would probably object that that’s an example what she wants to change. However, she also probably would object to education system reforms like those in Wisconsin and Michigan.

And, by the way, somebody should tell Ms Benedikt that calling president Obama a “bad person” is racist.

Detroit Charter Schools 47, Detroit Public Schools 0

A Stanford University study suggests attending Charter Schools in Detroit results in significantly better educational achievement than attending government schools. Stanford University study finds charter pupils gain an extra three months of learning

Detroit school children are learning at a rate of an extra three months in school a year when in charter public schools compared to similar counterparts in conventional Detroit Public Schools, according to the findings of a Center for Research on Education Outcomes (CREDO) study done by Stanford University on students in the Detroit area.

It isn’t perfect, of course,

“While on average the Detroit charter students have higher learning gains than their traditional school counterparts, when we look at the school results, only about half of the Detroit charter schools perform significantly better than their local alternative,” said Dev Davis, research manager for CREDO at Stanford University.

It isn’t certain what a comparison of the Bell curves for non-Charter vs Charter schools’ performance in Detroit would be from that statement, but here is a crude example which I think satisfies all the criteria Ms Davis specifies. Blue is the Detroit Public School System, green is the Detriot Charter schools.

Which curve would you prefer for your child?

Ms Davis seems to be soft pedaling the Charter story, at least for the Detroit study. I find it interesting that she does not mention a number important to this study; How many Charters are doing worse? CREDO generally does look at that:

A Credo study in 2009 of charter schools in 16 American states found almost half of the schools were no better than public schools; 17 per cent performed significantly better, while 37 per cent performed worse.

In fact, the CREDO report states that 47% of Charter schools in Detroit perform “better than their market,” and “Slightly more than half of Detroit charter schools were not significantly different from their market.” So none are performing worse than government schools.

That’s not the end of Charter advantages, though. I am fairly certain that no weight was given to the reduction in anti-capitalist, blame America first propaganda to which students are exposed. And, while I’ll agree that some Charters probably surpass even government schools in such polemics, at least the parents are choosing the slant they want. I would also contend that the improved educational outcomes are positively correlated with less time spent on social justice indoctrination and more on math and reading.

"…labor cartels with no interest in their customers"

That’s what I said Monday.

Today, Investors Business Daily asks, “Why Are Tuitions So High?”

An IBD analysis of data from the National Center for Education Statistics shows that from 1989-2009 the number of administrative personnel at four- and two-year institutions grew 84%, from about 543,000 to over 1 million.

By contrast, the number of faculty increased 75%, from 824,000 to 1.4 million, while student enrollment grew 51%, from 13.5 million to 20.4 million.

RTWT You’ll soon see that it is the confluence of Federal interference in K-12, Federal regulation of higher education, Federal student loans and Pell grants, and teacher’s unions political clout which are responsible for the perfect storm of rising costs.

Higher Education Bubble Rent Seekers

It’s not the students. It’s the ADMINISTRATORS.

A Senate bill that would encourage the growth of alternative training programs for teachers and principals, some of which would not be based at colleges or universities but would have the authority to give certificates considered the equivalent of master’s degrees, has come under fire from higher education organizations that argue Congress should focus on higher education institutions in efforts to improve teacher quality…

“While our organizations support the reform of educator preparation programs, we have several concerns about this legislation, and we ask you not to support it,” they wrote in the letter, which was signed by the American Council on Education, the National Association of Independent Colleges and Universities, and the American Association of Colleges for Teacher Education, among others.

“[H]igher education organizations” = arrogant closed shop public employee unions pretending to be professional associations. AKA labor cartels with no interest in their customers.

Of “higher education organizations that argue Congress should focus on higher education institutions” one can only ask, “Where have you been and what have you been doing to improve teacher quality while Congress was solely focused on your votes institutions, whose costs have risen vastly more (439% from ’82 to ’07) than any other segment of the economy? Why is the biggest category to increase in your bloated spending that of administration? Why are you still propagating useless ‘diversity’ and ‘feminism’ studies? What does the term “intellectual diversity” mean to you?”

The education monopoly

Ken Shelton, Middle Schools Computer teacher: “…the ultimate goal is to educate the children…”

In contrast to Mr. Shelton, the goal of a teachers union is to perpetuate the teachers union and the political objectives of its leaders, and the goal of the typical school board is to be re-elected. That is, the major players are players of politics. They do not care about winning a game called education. The worst part of this is that these education-indifferent interests are allies in lobbying. The general government is the entity they strive to “educate.” This system does not prioritize children’s education as even secondary.

The vast majority of those who do consider children to be the point of the whole exercise are neither union activists nor school board members. They are teachers. Not all teachers admire education over self-interested politics, but all the ones who should be paid to teach do.

The unions have devolved into a means of protecting bad teachers and paying them the same salary as great teachers. This is an example of a union secondary objective.

Good teachers are not paid enough. Great teachers are woefully underpaid. They teach anyway, even now. How many more good and great teachers might there be if we were able to value teaching skill, passion for educating children and results? I think at least enough to replace the bad teachers at no net present cost. And it would be far cheaper in the longer term.

Average teachers are probably overpaid, and bad teachers should be served with restraining orders keeping them 1,000 feet from students and any educational dollars.

Does our system allow that to be recognized? No. Here are some teachers speaking about why that is.