This is the new flavor of the political week right? We aren't talking about Roe V Wade and even though Trump's house getting searched is still in the news cycle, the new thing that everyone is arguing about is student loan forgiveness.
The gloves are well and truly off too as the media doesn't miss a beat in trying to drag down any political enemy and make them seem out of touch so that anything that they have to say regarding the topic will be negated later.
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Insider is 90% biased to the left. Everyone knows this. They used to be called Business Insider but that was failing and they needed to branch out. It was right around 2015/2016 that being in the politics game became profitable so they, like so many others, transitioned into that industry. The good news is that this industry became swamped with op-eds and now it is dying. I'm not going to complain about that because most of the political articles that you see these days are filled with half-truths or even will highlight something that was stated in a matter-of-fact way and try to make it seem elite-ist or out of touch with the common man.
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Sen. Rubio is a conservative Senator from Florida. He seems to be a mostly likeable guy and he has tried his hand at moving up the political ladder at least once only to get crushed in the primaries. He still maintains a nationwide PR campaign and I think people are at least familiar with who he is.
Recently he said that student loan forgiveness was "unfair" to the 85% of people in the country that don't have student loans and also claimed that the executive order in unconstitutional. Since these words are coming from a conservative's mouth, outlets like Insider go on the offensive to include an obscure fact about Rubio that he elected to offer in a press-conference after being badgered by reporters.
When asked how it is that he paid of his own student loans, which were over $100,000 he said that he "wrote a book that paid for them" and then went on to talk about if it hadn't been for the success of that book, he very well could still be paying for those loans today. There are two things here to keep in mind. Rubio was not at a press-conference about student loans when this question was being asked of him and he has never been terribly outspoken about how he feels about this recent change in the US, but he was merely answering the question of how he paid his own student loans in a very matter-of-fact way.
Insider tries to paint him as a privileged person who thinks that all people in student loan debt should just "write a book" and they too can be student loan debt free! I'm sure some of Insider's audience are dumb enough to actually think that is what Rubio is saying even though he never at any point suggested that someone should do that. It is quite obvious to anyone that writing a book is by no means a guaranteed payoff. In fact, it is almost always the other way around.
Rubio is being targeted during all the discussion that is going on during these times solely because of the fact that he is a conservative. I don't see any liberals being targeted in the news cycle for how they paid off their student loans. It's probably there somewhere but since a large portion of the legacy media is left-leaning, they don't talk about the people on their side.
I think that if anyone were to look at this article which is complete with unflattering images of Rubio looing aloof, they can realize very quickly that this is a hit piece against the man and once again, most people won't even make it past the headline and read that Rubio was merely directly asking a question that was asked of him. He wasn't gloating or attempting to advise anyone to just "write a book" and then they can stop being poor.
How long will this carry on? I've seen attempts at hit pieces on Ben Shapiro that were even funnier because the records they had on his student loans was actually a different person. They probably knew it was a different person when they printed it. This is all because of the fact that their readers aren't going to read the retractions or correction, just the original article. This just goes to prove that most of the news that we see these days are not meant to inform anyone of anything. They are designed to make very manipulatable people feel a certain way. Sadly, I think this tactic works on a lot of people.
“most of the news that we see these days are not meant to inform anyone of anything.”
This says it all. So I was interested in the details of how student debt works. I already know how debt works, so student debt is not much different. So I googled it, and most of the information was from the major media networks. I skipped all of them. And I sifted through Brookings and Rand Corporation (think tanks)...to improve my understanding of all of this.
I don't mind Biden forgiving some student debt. Nations sometimes do this to avoid depressions. But what I do mind is how the government plans on paying for it (more debt), if they fixed the underline problem (they didn’t) and is it going to help Americans decrease their debt to income ratio which is incredibly important for financial stability (no, it is not).
The government is going to be paying for this with debt. They drop the income that they would receive from student borrowers, and they have to compensate for that lack of income with more debt (issued bonds and cashed in by the Federal Reserve), because they need to continue to pay for programs, Medicare, Medicaid, defense, Social Security, etc… so we will all have to pay for this in debt service payments.
Did they fix the underlying problem? No, the Department of Education nor Congress have cut the amount of money to universities to retire outdated and obsolete education programs and amenities which contributes a great deal to education inflation...which prices out a lot of students. Demand pull inflation, or in the education field, it's called the Bennett Hypothesis.
And last but not least, will this put Americans in a better financial position by lowering their debt to income ratio for their household? Federal reserve data suggests no. Even though debt has become cheaper over the past 40 years, the past year excluded, Americans debt to income ratio has increased from 40% in 1980 to 160% today. Free money, whether it's cash or credit, without education and stipulations attached to it, does not improve Americans financial position. So most of those borrowers that received debt relief, will just spend the balance up to their debt to income ratio prior to the debt relief...buying a house, a new car, more stuff on a credit card, essentially swapping one debt for another. The savings rate over the past 3 years is a testament to that phenomena.
And since spending money adds to inflation, this debt relief is going to help push inflation higher.
This may or may not have been a good political move, but it was a pretty fucking stupid economic one for American households, federal debt, and the status of our world reserve currency.
All that said...media doesn't cover any of these economic consequences.
Good post buddy.
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An amazing and informative response. Thank you for that.
I think that for anyone that doesn't have their political bias blinders on (which unfortunately a lot of people do) this move to "eliminate debt" is purely a political move to try to win over young voters in November. It could end up working to some degree to score some votes, but younger voters are notorious for not showing up in very good numbers anyway. There could be a backlash from people who paid their student loans already and now feel as though they are being required to pay for other people's as well. This demographic likely votes in much greater numbers so this is a double-edged and dangerous sword for them to wield for purely political vote-buying methods. It could backfire is what I am trying to say even though the media is working overtime to try to paint it in a positive light.
Simple economic understanding would tell a person right away that there is no such thing as "debt elimination" but rather, just a transfer of the debt to another entity. It is alarming to me the amount of people that think that there is just a magic wand that "poof!" the debt just goes away! That's dream-land stuff man.
Unless it is a conservative website, nobody is even mentioning the stuff you posted above and they never will because if they did post objectively people would look at this and realize that it is not a good idea at all.
Anyway, the original point of the article I wrote was to highlight that the leftist media is already using this to target higher profile conservatives even though if they were to look at Democrats, they would find out that exactly the same thing that happened with Rubio, happened with people that have a (D) next to their name as well.
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I agree…Rubio, Republicans and Democrats…write books, give luncheon speeches, etc…to accumulate wealth and pay off debt. I'm under the firm belief that people are people, no matter what their political affiliation is, politics seems to muddy the water of that reality, but people are the same. Philosophies may differ a little bit, but whenever it's faced with reality, pretty much everybody's on the same page, even if they don't say so on TV :)
I also agree about voting demographics, as people get older, they vote more. The federal budget is a classic example of this, that's why Social Security and Medicare persist…don't piss off the older voters :)
Yep, debt isn't eliminated, it is either transformed into less income (accounts receivable), lower asset prices (debt asset values), or other types of debt (debt swaps). I like Warren Buffett’s philosophy on free money…”nothing sedates rationality like large doses of effortless money.” This debt relief is not going to help Americans. And the politics of this is just going to make it worse.
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