Student Loan Forgiveness: Don’t Confuse Policy With Politics

Student loan debt. Federal Reserve Bank of St. Louis. Public Domain.
Student loan debt. Federal Reserve Bank of St. Louis. Public Domain.

A mismatch between the title and sub-title to Matt Lewis’s April 18 column at The Daily Beast — “Canceling Student Loan Debt Only Leaves a Broken System in Place,” and “Democrats are delusional if they think student loan debt forgiveness is going to save them and Biden at the ballot box” — perfectly illustrates the fallacy of mistaking bad policy for bad politics.

In the body of the column, Lewis makes a couple of reasonable policy arguments against student debt forgiveness: It benefits the rich more than the poor, and it perpetuates a “higher education bubble” in which students pay far too much for schooling given the economic benefits they can expect to get out of a degree.

Lewis veers onto the shoulder and triggers the rumble strip, though, when he tries to jump from those policy arguments to the claim that a move by President Joe Biden to forgive student debt would hurt rather than help Democrats in the November midterms.

His case, in summary: A lot of people without student debt will resent subsidizing forgiveness, and will blame it on Democrats. “[T]here are around 43 million people who stand to be ‘winners’ from this policy, [but it] likely pisses off more people than it pleases.”

I’m a soft “no” on student loan forgiveness — I favor simply making student debt eligible for discharge in bankruptcy like other debt — but on the politics, Lewis is all wet.

First of all, his number for “winners” is low.

Suppose there are 43 million student debtors who will be pleased with forgiveness.

Suppose that each of them has only one living parent, who will likely be pleased to see a child out of crushing debt.

Suppose that only 10 million of the 40 million have spouses or voting age children who don’t have student debt but will be happy that the household is benefiting.

That’s at least 96 million people — 15 million more people than voted for Joe Biden for president in 2020.

It’s an average of more than 220,000 people per US House district. By my quick count, only 14 of 2020’s 435 congressional election winners enjoyed a margin of victory greater than that 220,000. In close races, even a fraction of those “winners” can make a big difference.

Now to the other side of the ledger: The people student loan forgiveness “pisses off.”

There’s an old saying about government programs — benefits are concentrated,  costs are diffuse. Ditto gratitude for those benefits and resentment of those costs. That’s why we have, for example, corporate welfare. Corporations lobby constantly. Taxpayers care a little for about a minute.

In this case, the “winners” will be more motivated than the “losers” in terms of  their votes (and their enthusiasm TO vote).

The “winners” got a big favor. The “losers” may eventually see, and might even notice, a small tax increase.

Student loan forgiveness may not “save” the Democrats from losing the House and Senate this November, but it certainly won’t hurt them at the ballot box. And that really has nothing to do with whether forgiveness is sound policy.

Thomas L. Knapp (Twitter: @thomaslknapp) is director and senior news analyst at the William Lloyd Garrison Center for Libertarian Advocacy Journalism ( He lives and works in north central Florida.