I TOLD YOU IT WAS A REGRESSIVE TRANSFER.

Populist politicians are catching on that a blanket forgiveness of student loans is a giveway to rich people.

[Florida governor Ron] DeSantis is right about how grotesque it is to make waiters and construction workers foot the bill for high-income professionals, who are going to make millions of dollars over the course of their lifetimes. Most student loan debt is graduate-level debt because that’s where colleges gouge people the most, fueled by a steady stream of easy money from the government over the last several decades. The industries with the greatest price increases over the last half-century are healthcare and education for a reason. The government always makes things worse.

What I really like about DeSantis’ reaction, though, is that he goes further than some other Republicans are willing to go, which has been a staple of his leadership. The right move here is not to tell those who fell prey to predatory student loans to pound sand. Yes, there’s ultimately a level of personal responsibility involved, but we can’t ignore the role the universities have played in this.

Those who benefited from these loans should have a part in footing the bill. That means universities that raked in gobs of cash to pay diversity officers hundreds of thousands of dollars a year should be holding the bag for those who can’t afford to pay their loans. The idea that we are going to make truck drivers pay the student loans of somebody with an MBA, while universities sit on hundreds of billions of dollars in tax-free endowments is insane. Any government program to relieve student debt should be completely dependent on taxing those endowments.

That’s where Republicans need to go when arguing against what the Democrats are doing. Counter their ridiculous vote-buying scheme by making changes to the student loan process, while also putting the universities on the hook for their predatory behavior. That will go much further than a temporary payoff that does nothing to solve the problem.

Stephen Moore dials the populism up.

Who would ever pay off a student loan ever again after this blanket forgiveness program?

Who would benefit? The most recent Federal Reserve Survey of Consumer Finances found that only 22% of families had student loan debt and that "student debt has consistently been disproportionately held by higher-income families." So this is a giveaway to the financially successful students and families paid for by middle-class workers, millions of whom didn’t go to elite universities in the first place.

Once student loans move to “free college” for everyone, university tuitions, which are already soaring at two to three times the inflation rate, would race further ahead of all other consumer prices. When I attended the University of Illinois in the early 1980s, the tuition was $1,000 a semester. Now, it’s closer to $12,000 a semester. Where’d all the money go?

The Biden administration has misdiagnosed the fundamental problem here. To wit: Colleges and universities have become fat, flabby, and inefficient money burners with no accountability. No oversight. No getting rid of bad teachers and professors. No looking under the hood to see where extraneous costs could be axed.

He also notes that those university endowments ought to serve as reserve margins for bad debts.  The first time all student loan debts get expunged, nobody, willing to pay back or not, will bother to repay.  If the big ticket universities are hedge funds with classrooms, well, recall that "hedge" is against downside risk, too.

It's gotten to the point that the house organ for woke business as usual in higher education recognizes they have a problem.

“Free” is the operative word as the Biden administration slouches towards student loan forgiveness. Prodded by progressives like Elizabeth Warren (fulminating again last week in The New York Times and pressing the president for “meaningful student debt cancellation, no payments have been made on student loans since March 2020. The Department of Education has attempted to justify extensions by saying they “provide additional time for borrowers to plan for the resumption of payments, reducing the risk of delinquency and defaults after restart.” But I don’t know anyone who really believes this.

In March, Biden’s chief of staff bragged that his boss was “the only president in history where no one’s paid on their student loans for the entirety of his presidency.” So it’s much more likely that six successive extensions (and the push afoot for a seventh to the end of the year or beyond, which the private loan platform SoFi has already factored into its projections) have established a culture of nonpayment that will make the $100 billion (and counting) cost of the COVID loan pause look like a down payment.

You know they're serious when an academician accuses Fauxahontas of "fulminating" and refers to a "culture of nonpayment." Ordinarily, that's what those mean Republicans do.

But the Jarrett regency and the so-called progressives in Congress have handed Republicans an issue that will appeal to, oh, people who worked their way through college, or served a hitch and used the G.I. Bill benefits at a state university, or went into a trade instead.

In the wake of the 2007–08 financial crisis and $500 billion of federal money to rescue an alphabet soup of financial institutions, President Obama took office and announced a $75 billion plan to help homeowners avoid foreclosure. Channeling the righteous anger of rich white men everywhere—and, appropriately, on the floor of the Chicago Mercantile Exchange—CNBC talking head Rick Santelli launched into a rant against “promoting bad behavior” and “subsidizing losers’ mortgages.”

His big idea: a tea party for traders to dump their derivatives in the Chicago River. Thanks to Fox News, this tempest in a teapot blew up into the anti-Obama Tea Party movement that nearly blocked health-care reform, gave us Ted Cruz reading Green Eggs and Ham, and—with a heaping spoonful of ethno-nationalism—Trump’s MAGA movement, where resentment will reign for a thousand years.

So if your salary is paid in part or in full by the $150 billion in college grants and loans doled out each year by the federal government, consider this question: Whom is loan forgiveness bailing out? First, only 15 percent of American adults have outstanding student loans. Among them are some college dropouts and graduates of schools that provided no value (for-profit and nonprofit). But that’s a small percentage of outstanding student loan debt.

The vast majority are college graduates and especially students who borrowed to attend graduate and professional schools, where six-figure debt is not uncommon. According to Brookings, “the beneficiaries of student loan forgiveness would be higher income, better educated, and whiter than beneficiaries of [any] other transfer program.”

How does America feel about bailing out a group with a median income of $76,400? My guess is even less sympathetic than Rick Santelli’s “loser” homeowners, especially as reports emerge of borrowers taking advantage of the loan moratorium to invest in crypto.

The table has been laid for another tea party. Last month, Americans for Tax Reform, a group led by Tea Party activist Grover Norquist, made the argument against the continuing moratorium in a letter to the U.S. secretary of education: “A moratorium on student loan payments is unfair to blue-collared Americans who did not rack up tens of thousands of dollars of debt and those who proactively paid off their debt. Many Americans pursued other opportunities instead of going into debt for an expensive four-year degree, such as less expensive schooling, serving in the military to receive education assistance, or working long hours to put themselves through school.”

Exactly. And people in the Jarrett regency are noticing.  "The White House is weighing up the possibility of using income caps to exclude high earners in its eligibility criteria for student-loan relief."  That means-testing might be modified, in order that people who borrow against their future earning power get to use their future earning power to pay off their loans.  "The people added that the White House is also considering excluding relief for loans that were taken out for professional degrees like medicine and law, and could limit the aid to undergraduate loans."

It looks like reports of a Republican panic over a blanket regressive transfer are premature.

Swift, executive action is one way to win back votes at a time when his party needs them most, but it’s also a risk, as executive orders are prone to legal challenges and political exploitation if, for instance, the presidents party has messaging problems.

We’ll see if the Biden administration has the guts to make a move.

The messaging problems confronting the Jarrett regency are self-inflicted.