The Student Loan Debt Fiasco
2022-09-06 · Guest: Elizabeth Nolan Brown (Reason magazine) · 52:46
Biden executive action on student loan debt forgiveness
Bob Zadek and Elizabeth Nolan Brown discuss President Biden’s executive action to forgive student loan debt, examining its questionable legal basis under the 2003 HEROES Act. They explore the economic consequences, including potential inflation and tuition hikes, as well as the moral and political implications of what they characterize as a middle-class bailout.
Topics: Student loan forgiveness, HEROES Act, executive overreach, inflation, higher education costs, wealth transfer, Biden administration, Supreme Court
Speakers: Bob Zadek, Elizabeth Nolan Brown
Introduction [00:00]
Bob Zadek: Hello, everyone. This is Bob Zadek, welcoming you to our country’s longest-running libertarian broadcast, heard every Sunday morning at 8:00 AM Pacific on AM radio and live-streamed nationally through my host, 860 AM The Answer. All shows are available, together with 800 hours of prior shows, on The Bob Zadek Show podcast. Please visit bobzadek.com for prior shows, guest and resource material, and a curated book list of other podcasts which you might also find of interest.
Our goal here at The Bob Zadek Show is to distinguish every show by our selection of specific content of interest to anyone curious about the social, political, and economic environment we share, and by our selection of the most perfect guest to present that content in an informative, accessible, and entertaining manner. Today’s guest and topic reflects that goal.
This past week, President Biden—oh, how I hate to say that phrase—President Biden took very meaningful executive action. In fact, it has been observed that this executive act was more economically consequential than any other executive act taken by any other president in our 240-year history. It is a big deal. And President Biden did it, took this action, this executive act. What does that mean? It means no input from Congress, no input from anybody. He just did it, probably signed it in his basement where he signs most executive actions.
Well, what did this executive act do? President Biden unilaterally took the step of forgiving student loan debt owed by millions upon millions upon millions of students who incurred this debt with the legal obligation, of course, of paying it back and fully understanding, or they should have fully understood, what they were signing when they signed it. Irrespective of that, that debt is now forgiven. Why was it forgiven? Because President Biden promised he would do it, as if that is justification in and of itself. He took this action because he had promised. The effect on our economy, the effect on our collective morality, the effect on the individuals whose debt is forgiven, and the effect upon the individuals whose debt was not forgiven is profound and uncharted.
To help us understand what will be those hard-to-anticipate—we only can let our fears take control and imagine the worst—to help us understand what this means to us and why we care, I’m delighted to welcome back to the show Elizabeth Nolan Brown. Elizabeth is over at Reason magazine, which is owned by the Reason Foundation. Reason magazine, by the way, is the only paper magazine I still continue to get. And I’m pacing around in front of my house looking for the mailman when I think it’s about due to come. It’s a wonderful magazine. I commend it to everybody, not because it reinforces your belief system, but perhaps because it challenges your belief system. It is a great read, and Elizabeth’s column is often found in the magazine. She’s been at Reason since 2014, and she has emphasized politics, policy, and legal issues surrounding sex, speech, tech, justice, reproductive freedom, and women’s rights. Oh my goodness, Liz, I’m exhausted even saying it, how do you even—let alone have you do it. So welcome, Elizabeth Nolan Brown. Liz has just written a piece on President Biden’s executive action. She dug into all of the issues we’re about to discuss. She is the perfect guest for a topic at the perfect time. Liz, thank you so much for joining us again and welcome back to the show.
Elizabeth Nolan Brown: Yeah, I’m happy to be back. Thanks for having me.
The Legal Basis for Forgiveness [06:00]
Bob Zadek: Now, Liz, the executive action. So we are told, if you just read the headline, that President Biden took executive action in forgiving student debt. But even executive action must have some authorization from Congress. Now, it’s a strained authorization as we will learn. So let’s start with where in the world did President Biden get the congressional power to take the action that he took? Then we will go from that, once we are understanding how he thinks he can do it, what it means, as I said, to all of the various types of individuals who are in one way or another affected by the action. So first, how did he find the basis? And Liz, help us understand why Nancy Pelosi a year ago concluded that Biden didn’t have any such basis.
Elizabeth Nolan Brown: Yeah, it’s sort of nuts how he decided to do this. You know, typically, obviously, this would be something that would have to be undertaken by Congress since Congress is the body with the authority to control federal spending. But Biden invoked this 2003 bill, which was very much a post-9/11 sort of a bill, called the Higher Education Relief Opportunities for Students Act. And it was signed by George W. Bush, and it said that it permits the Secretary of Education to waive or modify federal student financial assistance program requirements to help students and their families or academic institutions affected by war, other military operations, or national emergency. So essentially, it was supposed to help people who were, you know, fighting the Bush-era war on terror. But now, a national emergency, Biden is counting the COVID-19 pandemic as a national emergency. So he’s saying that this bill gives him the right to—gives the administrative branch the right to get rid of financial aid obligations—or student loan obligations.
Bob Zadek: Now, Liz, I want to just stop there for a moment. I try very hard to turn off my lawyer persona, but sometimes I don’t have enough self-control. Now, the phrase you read was “war,” “other military action,” or—read the phrase again.
Elizabeth Nolan Brown: “War, other military operation, or national emergency.”
Bob Zadek: Okay. Now, as the Supreme Court has reminded us countless times, that when interpreting a statute such as that, when there’s A, B, comma, or C, C must have something to do with A or B as a matter of interpretation. That is unchallengeable. That is how the Supreme Court tells us to interpret a statute. So the two words before it relate to military action of one form or another. And then “or,” Supreme Court will tell—will presumably tell us again, we hope, that COVID is not like a war or military action. And therefore, he doesn’t get to do that. But it doesn’t stop Biden. Remember when Biden took steps involving moratorium on eviction? He knew, he acknowledged, “This is not going to succeed, but it’ll succeed for a few months till it goes to the court. So I’m going to plow through, do it anyway.” And Biden is presumably—doesn’t care if this is reversed later. He then can say, “I got my ticket punched. I did what I promised to the progressive left, so don’t yell at me, yell at the Supreme Court and let’s pack it and get rid of them.” I just wanted to make that point, sneak in a bit of statutory interpretation. Now, please continue with your explaining to us what Biden has done.
Elizabeth Nolan Brown: Yeah, definitely. No, and I think, you know, it really speaks to also how executive power—when we’re expanding executive power, people think like, “Oh, it’ll just be used in this particular circumstance though,” but how much that’s—that’s not the case, you know, how much people will stretch whatever sort of expansions of executive power that Congress grants them to do all sorts of even more expansive things, which is, you know, what we’re seeing here. I know that I mean, I am not a legal expert, especially not in this—in this realm, but I know that sort of opinions are mixed on whether this will—from what I’ve seen, opinions are mixed on whether this will hold up or not. My colleague Damon Root wrote about it and he says—
Bob Zadek: He wrote a wonderful piece. He wrote a wonderful piece, also in Reason. There’s another point I want to just sneak in if I may. Clearly, when that statute was written in 2003, Congress clearly intended that the war or the other military action would have caused the problem that the President was going to relieve. Now, COVID did not cause students to incur debt. It didn’t cause any of that. It may have somewhat, but it’s not clear, affected their ability to pay it back. But he could—he could postpone it and say, “Okay, we’ll give you a moratorium and then catch up later,” which is what they did with—with mortgage payments and it’s what they did with rent payments. But Biden took two events that really had not much to do with each other and hooked them together. And in reading the piece and in reading your article, I asked myself, what if there was a flood? Or what if there was something, a national emergency like a drought? Would that be the basis, according to Biden’s interpretation of that statute, to forgive forever student debt? The most rhetorical of questions, no one can answer it, Liz, I dare say not even you and not even me. I wanted to throw that out there, but please continue with your explaining to us what Biden has done.
Elizabeth Nolan Brown: I mean, I think that that pretty much sums up his justification for it, which is just a very, like you said, a very stretching interpretation of a law that was written for totally different circumstances and just sort of hoping that it will pass muster or that if it doesn’t pass legal muster in the long run, that it will at least, yes, pass legal muster long enough for it to affect the maybe the midterm elections coming up or even just, you know, it could stretch out for years in court and he’ll still get to sort of coast on like, “Well, I tried to do this good thing and other people blocked me.”
Economic Consequences and Inflation [13:30]
Bob Zadek: Now, the—as you have indicated in your piece, obviously, forgiving debt has profound economic effect on the country. We’ll drill down, Liz, as you did in your piece, and try to pick out discrete segments of our economy who are affected more than others, one way or the other, and where the executive action is more unfair to them than to others, as you have in your piece. But first, in the broad sense, what’s the economic effect of this forgiveness? After all, Biden is not writing a check. He’s not increasing anybody’s taxes—or is he? We’ll get to that. So tell us about in the broad sense, the economic effect, both in terms of what it is and how much it is, by President Biden taking this executive action without the input from Congress.
Elizabeth Nolan Brown: Right. Well, so he’s, you know, he’s going to wipe out between $10,000 and up to $10,000 for some people and up to $20,000 for other people, people who are making under $125,000 per year. So this could result in millions of people having their student loans wiped out to the tune of hundreds of billions of dollars. And the economic effect of this, like you said, it’s not like they’re, you know, the government isn’t directly cutting a check, but the government won’t be getting this money, or a lot of the money which was lent by federal lenders. And I think the biggest worry though is that it’s going to be inflationary. One, you’re giving people, you know, people will have more money in their pockets and so that could lead to more spending and we could—it could raise inflation at a time when we’re already dealing with a lot of inflation problems. And second, that it’s going to be specifically inflationary towards education prices. Because, you know, if—one of the biggest problems with why tuition has gotten so expensive is because colleges realize they’re not actually competing in a free market system. You know, so much of this is subsidized by federal loans—by student loans that are backed by the federal government that they can just raise prices and raise prices and people will keep paying them because they’re like, “Ah, I got loan money.” So that’s already a big problem and, you know, this could mean that it’s going to have even more—give them even more incentive to raise prices and think whatever, because people are going to think now, “Well, okay, whatever, if I—if I take out these bigger student loans, then I will probably just get them written off too.” And then colleges can just raise the—their education prices even higher.
Bob Zadek: Let me just—to add to what you have said, you had pointed out that colleges will just raise tuition. Of course, that’s not you getting into a—depression fantasy. The history has been that there is a direct—nobody can challenge it—direct relationship between availability of student loans and the cost of college. And many economists, most economists, have observed that there are two segments of our economy where inflation is greater than in the overall economy. And that is healthcare and college tuition. What does healthcare and college tuition have in common? What they have in common is the customer never knows nor cares how much something costs because someone else is paying. When you don’t have a customer causing pressure on the seller, whether it’s a doctor or a university, when you don’t have a customer bargaining for lower price, the price just goes up. Anybody would do that if the buyer doesn’t care. So the effect of the availability of student loans is that students are spending somebody else’s money, like when we go to the doctor because we’re spending the insurance company’s money. So once students—
Elizabeth Nolan Brown: No, I was just going to agree with you and say, right. I mean, it’s already hard enough, I think, for young people, 18-year-olds, however old they are when they’re starting college, to—to sort of imagine the idea of paying back a loan. I mean, it’s all just nebulous. It’s like, “Ah, well, I’ll take out this money and I’ll have to pay it back,” but they don’t, you know, maybe think so much about interest or maybe they overestimate their future earnings. They just—it’s already hard enough, I think, for young people to really imagine what it’s going to mean to pay back a large loan. And now, if you add in on top of that them thinking like, “Well, I probably won’t even have to pay it back because, you know, the government’s going to keep forgiving loans or they’re just going to start subsidizing this,” then yes, you’re—it’s going to encourage students to take out even larger and larger loans, which is just going to allow the universities to keep hiking their prices up.
Bob Zadek: Okay, so we see, as you have explained to us, that it creates—it exacerbates the incentive of universities to be desensitized to the price of their product because nobody cares. So why not charge more? So we have identified already a few minutes into the show, one nationwide, unhealthy, adverse effect of this simple act of President Biden without input from anybody very much, extinguishing an unpredictable—we don’t know how big it’s going to be—portion of student debt.
The Fairness Factor [20:00]
Bob Zadek: Now, what about the effect upon the rest of student debtors who don’t qualify, either because they don’t qualify for the $125,000 income—but I’m going to come back to that concept of $125,000 of income because it isn’t clear, haven’t read the executive order yet, but it isn’t clear to me how you measure that. Is it taxable income? That is, assuming you have what used to be called a trust fund baby who is living off a portfolio of several million dollars of city, state, and local bonds, which means $100 million—a million dollars of income is not taxable. So that individual’s net income, if it’s taxable income, is zero. Or is it something else? If it’s something else, what do you do with deductions? So all of that is lots of luck, guys. But I just wanted to mention that in passing because I think it’s—you can’t tell. So what about the effect on the rest of student debtors who didn’t receive the money? But I dare say, putting aside the fact that the student debtors who received the 10 grand are 10 grand to the good, but are they really better off? What has happened to the life lessons they are being taught, even though they get relief of 10 grand? They are not emotionally, morally unaffected by this gift. What do you—what do you imagine, what do you feel, because you have studied this, is the collective—is the likely collective effect upon the recipients of having incurred a debt that maybe they shouldn’t have, maybe they should have, but incurring a debt and then being told, having nothing to do with merit, they don’t have to pay it back?
Elizabeth Nolan Brown: You know, I—well, first, I just want to be clear that I don’t think that it’s like people who have student loan debts are necessarily irresponsible or anything like that. I mean, I had student loans, I had student loan debt. I don’t anymore because actually my—my husband helped me pay it off a few years ago. We were actually just talking today like, we finally paid it all off in 2019. It’s like, Biden’s plan backdates it, so if you made your final payments even in 2020, you can get a reimbursement even. So we were joking like, “Oh, we should have, you know, should have just waited until 2020. If we’d waited a little longer, we’d be $10,000 richer.” I’m joking, but you know, it’s—it is that sort of attitude. It makes people, you know—I am more worried on the effect though it’s going to have on future borrowers. You know, I—people are struggling a lot. I think that I don’t blame anyone who’s going to be like, “Yes, this is great.” I mean, this is going to—this is obviously going to help a lot of people out. But I think that it creates, like, really bad incentives for the future, either for people who got their loans discharged or people who haven’t even taken any loans out. It just says to them like, “Yes, go ahead, borrow what you want because you’re probably just going to have it covered.” Because I mean, already you see that after Biden announced this, so many people on the left have been like, “Well, this doesn’t go far enough.” And there’s a lot of people promising that it’s going to go further eventually. So I think that it’s very—I mean, unfortunately, very rational for people to look at this and say like, “Oh, this is actually only the beginning. I will probably have more of my debt written off, or if I borrow more now, I will probably have it written off in the future.”
Bob Zadek: I think back to the decade-plus years ago, the financial crisis of approximately 2008. And the word that became an obscenity, the word that gave birth to the Tea Party, is “bailout.” Do you remember the bailout of General Motors? The country was collectively enraged at the very concept that the government, in the most extreme sense of the word, picks winners and losers, in this case bailed out General Motors, bailed out the large banks, bailed out the large brokerage houses, bailed out, bailed out, bailed out. People were getting their muskets out of the barn every time the word was mentioned. How is this nothing other than a bailout?
Elizabeth Nolan Brown: Oh, definitely. And you know, it’s funny because when me and some of my colleagues have been writing about this or talking about it on the internet, a lot of people are like, “Oh, well, so you’re mad that like they’re helping individual students, like where were you when they bailed out big businesses?” We’re like, “We were complaining about that too. Like, we were also against that.” Um, yeah, but no, I mean, it’s definitely the same concept. And I think it’s also—it’s notable that this is essentially a middle-class entitlement that he’s starting. You know, I mean, that’s—that’s I think another reason why it seems so—morally wrong really is because this isn’t—this isn’t a—this isn’t aid that’s going to the poorest people. This isn’t aid going to people who couldn’t even, you know, go to college. This is aid going to people who—who actually have gone to college and are making up to $125,000 a year. It’s just—it’s very silly to say that someone who is making $125,000 a year can’t afford a few hundred dollars a month in student loan payments. And or, you know, like I have a—someone I know whose wife is a doctor and she is under the threshold right now, but she is going to, in like six months, has already has this job lined up where she’s going to be making a lot of money. And it’s like, so you’ve got those people too, the people who maybe right now are under this threshold and are going to be making way over it very soon. Like, they also could afford to pay back their student loans. So it just—it feels like we’re, yes, we’re taking money from, you know, from to give to people who don’t need it.
Bob Zadek: So it certainly is a wealth transfer to the middle class or upper-middle class, for sure. The demographics show that, that is not really disputed. The other—the other half of that, the word “transfer,” the word “transfer” means “from” “to.” That’s what a transfer is. It is—to the “to” part of the word “transfer” is upper-middle class or middle-class people, hardly in need of debt relief. What about the “from”? What does—and of course it’s early in the game, but from your reading, what do the economists and those who study this stuff tell us about who’s going to bear the brunt of the “from”? From whom is the transfer made? We know the “to” part of it. Tell us what you believe to be the “from” part of that transfer.
Elizabeth Nolan Brown: I mean, this is where it gets a little tricky because this, like you said earlier, this isn’t a direct tax on anyone. So it’s, you know, and they’re saying, “Well, this is money that—that the government is owed but it, you know, it’s just writing it off.” So it’s not like the government is spending this money, it’s just not—it’s just letting these debts go. But, you know, that effectively means that it’s not getting a lot of money that it relied on. So it’s going to have to make up that money somewhere, which seems like it’s—and from what we know, it’s not going to make up that money by cutting spending elsewhere. So it does seem like it will cause eventual rising in taxes. And—and you know, so they say like, “Oh, this won’t actually, you know, this isn’t actually taking from taxpayers because it isn’t directly doing that.” But, you know, federal—federal money has to come from somewhere. It is obviously going to lead to, you know, needing to make that money up.
Existing Legal Remedies [31:00]
Bob Zadek: Now, in this—in this conversation about debt forgiveness, what isn’t mentioned, and it just—because people just don’t know about it, is that I would imagine the typical student which has debt, probably student loan debt is the major debt they owe. They probably don’t owe much other, maybe some credit card debt, but it’s student loan debt. A student which owes student loan debt can always file for a bankruptcy case. Now, that’s not so drastic. It’s a proceeding in bankruptcy court. Basically, you file some papers, you pay a lawyer about $1,000, maybe less, and you can get that avoided if you can’t afford the $1,000. And as a result of that, your debt is forgiven. But there’s a catch. Congress years ago was worried about doctors incurring—who are not going to be poor—incurring hundreds of thousands of dollars of student loan debt. In other words, you go to medical school on somebody else’s money, and then a doctor has a medical degree, has a medical license, owes 300 grand or more, is about to go into practice, files a bankruptcy. That doctor has been supported by his wife for four years while in medical school, has no assets, goes into bankruptcy, discharges the student—the medical debt and now gets earnings of a doctor. That offended Congress. So Congress said you can’t just discharge your student loan debt. You have to make a good faith showing that you tried to pay it back and you can’t. That seems kind of reasonable. So that if you’re disabled and you can’t get a job, or you had an illness and you can’t get a job, or nobody wants to hire you and a judge said, “Okay, you tried.” Now, that’s a standard I can live with. And that already exists. So before we focus too much on the student, they don’t need $10,000 of debt forgiveness. They could get the entire debt forgiven under existing law without Biden’s help, thank you very much. Without Biden’s help, but they have to show they tried to pay it back. I kind of like that standard. Let them show they did their best, and if they still can’t pay it back, they shouldn’t be saddled with this debt for the rest of their lives. That works for me. But nobody in no discussion was that mentioned, that as given that the student doesn’t have the money to pay it back, there are adequate remedies without Biden’s political gift.
Elizabeth Nolan Brown: Yeah, I mean, and there are also just all sorts of ways to have your student loan deferred, and there are graduated income payment plans. I mean, I for many years was on—was paying very, very minimum payments every month because I was making very little when I first started out. And you can—you can go on there and say, you know, I think I was paying $68 a month. And I know, like, you know, and then as I—as I made more money, I eventually started paying more. But there are all sorts of ways you can go on there and you can have the interest sort of suspended during that time period. You can have—you can get hardship deferrals if you’re out of work or if you’re just making very low income. You can have them deferred and they will say, you know, we’ll just put everything including interest on pause and, you know, you can come back and pay them. So yes, it’s also there are, in addition to what you said about bankruptcy, there’s also just they’re very flexible in the way you pay them back. It’s not like, you know, they’re like you—you get out of college and you have to—you have to start immediately paying this back at this much per month. I mean, a lot of these loans, there’s—there’s very much ways that you can take your time paying them back and they’re very forgiving about it.
Bob Zadek: And the federal government, because we—most of us will remember that there was a time that at one time student loans didn’t involve the government at all. They were private loans like a car loan or a house loan. You went to a bank and you got a student loan. And then the government got involved, and first they, to encourage banks from making loans to students, they—the federal government historically first got involved, it said, “We’ll guarantee the student loan.” So banks, you do the lending, you do the administration. If you don’t get paid back, we’ll pay it back. Then, I believe it was during the Obama administration, that Obama concluded that was a rip-off because the banks were making federally guaranteed loans and charging interest and they were taking no risk. And Obama said the banks are getting too rich on us. So the federal government took over the entire student loan program. To use a word they don’t like to use, we nationalized or socialized the private business of student loans. We nationalized it. And now we have the system we have today where students get unlimited money without regard to ability to pay, for unlimited amounts, to spend irresponsibly so long as they give money to a school. It doesn’t have to be of any value. The student is not required, as we all know, to show that he is using borrowed money—or she is using borrowed money—to acquire an income-producing skill. So it’s a good investment. Commercial lenders make loans to businesses because they’re going to use the borrowed money to generate revenue, and the revenue will be the source of repayment. But for the government to say it is so important for a student to learn medieval history—it is so important to us that we will underwrite the whole process and free everybody from any economic consideration. We call that—and our friends at Reason call it—it is called a public good. We have kind of decided without a vote that it is just plain good for the country for somebody to study ethnic studies or medieval history. I don’t question whether that’s good or bad or not. That’s an individual decision. But I do question whether we collectively as a country benefit from underwriting it. And there’s been no consideration of is this student using the borrowed money in a way that benefits all of us, because after all, we’re footing the bill.
Elizabeth Nolan Brown: Right. And also people often will borrow money to go to school for a few years and then not end up even getting a degree in their field and—and end up doing something totally different. So I think, yeah, it incentivizes taking classes, doing things in particular majors or even just going to school in general when people aren’t really going to end up using that and then just saying like, “Oh well, it’s—it’s covered.”
Political and Legal Outlook [38:00]
Bob Zadek: Now, what—it’s very early in the game, and you must spend lots of time with your buddies at Reason speculating on what’s likely to happen, what’s likely to happen to the economy. You’re using a crystal ball, of course you could be wrong. Who do you think will end up being the winners and losers from this executive action? And I’ll remind our listeners, this executive action, if you measure it by economic effect, it’s the largest, most profound executive action ever taken by any president. It was taken by a president where both houses of Congress are exactly evenly divided, the country is evenly divided, there is no mandate to do it. And by the way, there is no reason for executive action as opposed to the more small-D democratic action is Biden submitting legislation and asking for legislation and let the cowards in the Senate and House debate it and vote. There’s no rush. Nothing is going to happen by Labor Day where the world will take a dramatic turn for the worse. So what do you and your colleagues see as winners and losers? What’s going to happen from this bill? You’re free, it’s an opinion show, so the beauty of it is you can let your imagination fly and let it soar. And what do you imagine might—could be the consequences of this mammoth executive action?
Elizabeth Nolan Brown: I mean, my—I don’t think my imagination is that—imaginative, I guess I’ll say, because it seems just pretty simple that Democrats are going to benefit from this. The Biden administration is going to benefit from it. They are going to get political—they are going to score political points because they’re essentially buying goodwill, buying votes by, you know, writing off people’s debts. And I think that the people that are going to be harmed by it are—are students and, you know, future students and just our education system in general. As we’ve talked about a lot, you know, it’s just—it’s creating very bad incentives for—for our education system that’s just going to keep perpetuating higher and higher costs and ultimately, you know, make everything more expensive in the long run. And then we’re just going to keep subsidizing it and it’s just going to be creating a vicious sort of feedback loop.
Bob Zadek: And then what happens is, of course, as we have seen so often, the $10,000 becomes a starting point. And once the country shows it can absorb this, that it’s not going to punish Congress or punish the White House or punish anybody for this action that very few people can defend other than politically. If you put aside the possible and dare I say likely political benefit for certain demographic and maybe at a cost of losing other demographics, but that’s for the politicians to sort out. The effect is these become entitlements. And let’s remember that we still have student loan deferral. There’s a—there’s a COVID-originated deferment of student loan repayment, which I think is deferred until—this is from memory, Liz—December 31st, I think, something like that. And what—and does anybody think that Biden has the political will not to say, “Okay, that’s the drop-dead date, now you start making repayment”?
Elizabeth Nolan Brown: Right. It’s once these things get, yes, once these things get to become expectations, it’s very hard to get rid of them. As we’ve seen with like the housing moratorium during the pandemic and yeah, now the deferment on student loan repayment. It’s once it’s there, it’s very easy to keep saying, “Well, we’ll just extend it, we’ll just extend it, we’ll just extend it,” and it’s very hard to—to yeah, to get rid of it entirely. So I think you’re right that this is going to be something we end up with.
Bob Zadek: And as we—as we speculate on what will be the aftermath of this executive action, let’s also include the strong likelihood that an—a court, an appellate court, will find it unconstitutional. What will the result of that be? Biden gets to say, “I did my best. I kept my promise. So don’t yell at me. Remember, guys,” as Biden speaking as a Democrat will say, “remember, we warned you about the Supreme Court.” And the Supreme Court will be, if ultimately it finds its way to the Supreme Court—it doesn’t stop in an appellate court—if it finds its way to the Supreme Court, once again, the Supreme Court will be demonized and politicized. Because I think it’s likely, as I kind of read the tea leaves, this doesn’t pass. I think your colleague Damon Root is correct. It—it has a very questionable life in the courts. But it doesn’t have to. And I dare say Biden is probably neutral on how much he cares. He’s gotten what he wanted. He’s kept—he’s kept like Evita, he’s kept his promise, although I don’t see—um, so he’s kept his promise, it’s off his plate, and he now has the Supreme Court to demonize. And when I mentioned Damon Root, I just want to mention to our listeners that Damon is a—writes on legal issues and constitutional issues for Reason magazine. He is one of Liz’s colleagues over at Reason. And he has just published a piece on this very issue, again, a compelling read.
So what—I know you don’t—you’re not a political—you don’t wallow as I don’t in the day-to-day politics, but who are the demographics who are likely to change their vote? The first part of my question is obvious, the second is the more subtle. Who is likely to change their vote in support of Biden because of this? And who is likely to change their vote from independent to against Biden because of this action?
Elizabeth Nolan Brown: I don’t think that there’s probably very many people likely to change their vote against Biden because of it. I think that most people who were already going to be, you know, who are opposed to this action were already going to be against Biden. So I think that again speaks to why this is good politically for him, because there might be some people who are just sort of centrists or sort of apolitical who are on the fence who would think, “Oh, like Biden’s going to forgive my student loans. Okay, that’s,” you know, people if they’re voting from self-interest, it’s like, “Hey, why not?” So I think, yeah, it’s got—it’s got more definitely more of an advantage to—to him than not, or to the Democrats than not. Hopefully, Biden’s not going to run again, but—
Bob Zadek: There is probably one large demographic that might be in play as a result, and that’s working-class Hispanics who are not—while you can’t generalize about an entire segment of the population, but when you do these studies, you count the heads and you count the numbers. And the number we discussed earlier, working-class high school-educated workers will statistically bear a large brunt of this wealth transfer from them to the middle class and upper-middle class. That’s going to include the demographic class that is very much in play, which is the—the Hispanic working class, especially immigrants. And I think they will find this whole step to be quite offensive. But we’ll see, we’ll see. We have only a couple of months to wait.
So Liz, as we—as we wind down and regretfully, as always, run out of time on our show, tell us what projects you’re working on at Reason magazine and how our audience can follow your work.
Elizabeth Nolan Brown: I write a morning newsletter, a weekday morning newsletter for Reason called the Reason Roundup. So you can—you can find that on reason.com, subscribe. It just sort of covers whatever is happening in the news from a libertarian perspective. I also tend to write longer pieces for us. I’m working on one right now in defense of algorithms. So you can find my work on reason.com and you can find me on the internet on Twitter and Instagram at ENBrown. Also, also I should say I co-run a libertarian feminist group too called Feminists for Liberty, and you can find us at feministsforliberty.com.
Bob Zadek: Feministsforliberty.com. And you’re—you’re shilling for the algebra lobby in defense of algorithms.
Elizabeth Nolan Brown: I am, I am shilling for big math.
Bob Zadek: So Liz, thank you so much for your time and for your wisdom on—and on the student loan executive order and for calling our attention to both student loan problem with sexuality and feminism in America. You appeared on my show a year or so ago on that topic. And for all the work you do at Reason magazine. And most importantly, thank you to my listeners for giving me an hour of your time today. I hope you have found it to be worthwhile. Thank you so much to Liz, thank you so much to my listeners. I’ll be back again next week. Thanks so much.
Elizabeth Nolan Brown: Thank you.