I have an economics teacher that made this claim in class yesterday. I wanted to know other people’s thoughts about it.
I am presumably a lot less qualified to speak on matters of economics than an economics teacher (assuming they became one through a background or qualification in economics), I’m also not even from the US. That disclosure aside, given you put this question to the masses and to the world here’s my take.
I can’t figure out how your teacher could have come to this conclusion with intellectual honesty. If my amateur’s understanding is correct, this forgiveness program is achieved by the US government paying for the loans, so it’s difficult to say on a basic level how any theft can have occurred. This is especially plain given the program is limited specifically to loans issued by US government in the first place as Federal student loans. If I loan you money and then tell you not to worry about paying it back after all because I’ve decided to forgive the loan I can’t find a way to frame that as theft. Who’s been stolen from?
If I really stretch I could see people who paid their own loans in full before this happened feeling like it was pretty unfair, but they weren’t stolent from, just unlucky in timing. Some people will say of taxes generally, that they feel like the money taken from them by the government in taxes is theft, but in that case this specific instance of government expenditure is no more theft then the latest batch of F35 fighter jets bought by the military or the wages paid to the local garbage collector to take out your garbage or any government spending at all, since that money all comes from taxes. Maybe your teacher is trying to tie the potential economic costs of the policy in to a narrative of stealing from US taxpayers. Maybe the costs of the program could theoretically mean taxes have to be raised at some point, but again though, you *already " have to pay taxes and how much, more taxes or less, is up to the administration in charge at any given time based on what they think is necessary. This is how the US or any country has a government at all which is generally considered necessary by most. When the government operates and uses taxes to do so, the citizens essentially pay for a service, that service involves the government making decisions on your behalf on what to do with the taxes you paid them. If most of the taxpayers don’t like the decisions and think they were bad choices they change their government and lobby representatives, it doesn’t make the decisions themselves theft if you just don’t like them.
That’s about all I can think of in the absence of your teacher’s justification, for how the loan forgiveness can be called theft, trying to be as fair as possible to those potential reasons, I still can’t find a way to make the statement true.
No, if you forgive the student loans so that the graduates can contribute back with their knowledge to society.
My thought is that you should find a different class with a different teacher.
6 posts and 0 comments? My guess is, I can type in here absolutely anything, and you won’t reply. You’re asking questions, but do you even want to hear the answers?
Go ahead and stop guessing. I don’t owe anyone a response. I asked a question and I wanted to hear people’s answers. But you didn’t even do that so why SHOULD I reply? If I want too, I will.
Thanks for the answer. 👍
All property is a social construct and is defined by law. So if the law says debt is no longer valid, then the loan agreements cease to be property and there is no stealing it.
That’s like saying if there was no law against theft I could drive away with your car, and that’s not stealing. I don’t think your argument is very convincing.
If the law said my car is no longer my property, then driving away with it would cease to be stealing, correct. What is property without legal, government-backed title? There’s no way to formulate a definition, because without government and laws property has no meaning.
Property has existed before laws existed to enforce it. It was enforced with violence. Stealing is still stealing even if there’s no law against it.
And if there was a disagreement about whose property was who’s? With no laws to settle it, it would just be determined by who grabs said property and runs off with it first. That’s indistinguishable from a free-for-all.
No.
Stealing is usually defined as taking something that exists in a way that denies the original owner its use and grants the illegitimate owner its use.
This is how loans work in fractional reserve banking: loan provider has assets of $1 million, they loan out $10 million, having wholesale created the additional $9 million. If those loans are forgiven, but the original assets did not change, what has been stolen?
A fictitious amount of theoretical money.
If I make up an image, and you copy that image, but I get to keep the original, is that theft? No. Obviously not. Made up money is no different.
You can’t just destroy money. With fractional reserve banking any bank can create money, but they can’t destroy it. Only the Fed can “destroy” money by buying bonds back and not reselling them. Forgiving a is a loss to the lender, in the case of student loans, the government guarantees them, so the lender gets made whole and the government assumes the debt on behalf of the borrower.
The image is a poor analogy because unlike when someone creates an image or any form of art, when a borrower takes out a loan, the lender records a receivable as an asset and the borrower’s account as an offsetting liability. Once this happens, the loan cannot then just be magically erased—somehow, some way, the lender must be made whole again. In the case of loan forgiveness, it comes out of the tax payers’ pockets. Whether that’s theft or not is a separate topic, and I think another commenter covered it well by comparing it to any other government program or subsidy.
No it can be ‘magically’ erased, it was ‘magically’ created out of thin air with nothing backing it. The money doesn’t actually exist, the asset for non existent money can simply have zero value. Loans are erased this way literally constantly. In fact more loans are erased this way than actually paid, if only by volume and not purported value. This is what happens when you default and no value is reclaimed on a loan, or when one defaults on a healthcare bill with an arbitrary price tag.
There is absolutely no reason, whatsoever, the lender has to be made whole. That’s not a thing in other circumstances where loans lose all value and the money created for them disappears.
When a borrower becomes insolvent and the loan cannot be repaid, the lender records it on their books as a loss. They cannot just pretend the loan never happened.
Of course, now we’re mixing subjects because OP asked about student loan forgiveness, which would necessarily come out of tax payers’ pockets (not the same as when a lender takes the L because the loan cannot be repaid).
It doesn’t have to come out today tax payers pockets, that’s the entire thing. The money doesn’t exist, the debt doesn’t exist.
We made up this system specifically so we didn’t have to keep exact books, that’s the point of fiat currency over backed currency. If we don’t use its primary feature for good, ever, we may as well go back to the gold standard which would elimate nearly all banks and lenders at this point in the capitalist finite curve.
Fractional reserve banking does not mean the debt does not exist. The debt very much exists. Nobody takes out a loan and just sits on it. As soon as the loan is created, goods and services are traded. At the end of the day, each party to downstream transactions can go to the bank and withdraw the balance of their account in cash. The fractional reserve system only works as long as not everyone does this at once.
Except it’s new money that’s made up, and in the case of student loans, most of that money isn’t traded for goods and services, instead more than 3/4s of the money created goes back to the lender.
Looks like we are not going to agree on this, which is okay—I enjoyed the discussion nonetheless. Have a nice day.
Who cancelled it?
That’s what it comes down to.
If the person that took out the loan cancels it by some kind of fuckery, then you could likely call it stealing.
If it’s the entity that made the loan, obviously not.
If it’s an agent of the government, which is ultimately the expression of the collective people which defines what stealing is and isn’t, then it would depend on how it was achieved. If the agent of the government acted within the law as established at the time the loan was cancelled, then it can’t be stealing from a legal standpoint.
Now, is it ethical? That’s a different question. It could be seen as a form of theft, but I would argue that it is no more or less theft than taxes, fees for government services, interest, etc. If it is stealing, then pretty much every government enforced payments are theft to begin with, which includes the interest on those loans.
Stealing is when you take something from someone illegally. What you described, and what OP described, is not even close to that.
First, what was taken from who? Money from the government, let us suppose. But legally. And even if it were illegal, which it isn’t, what is the damage? Of course there is none. It’s still 100% moral.
Comically, this is such a mild example of the Prodigal Son. Didn’t folks learn this shit in Sunday School?
No.
Lol from who? The fucking predatory banks? Fuck debt, its what rich people use to keep us in servitude. School costs absurd amounts because of this shit.
I think one way you can at least partially answer that is by asking whether college tuition has increased in price equally with how valuable a college tuition is.
The answer is no btw
If instead of loans, education was paid through taxes, would that still be stealing?
I’m inclined to believe your economics teacher would say taxation is theft, and can be ignored. Using taxpayer money to improve society is not “theft”, it’s the social contract.
Only by the rich people who are actually stealing from us. PPP loan forgiveness for their litany of fraudulent claims…
Stealing from who? It’s a social program, if society has deemed it necessary and the bourgeoisie allows it then it is simply spending.
It’s the same answer to “if you give someone a gift, did they steal from you?” or “is a discount stealing?”
No. A more educated population is better in every way.
But, assuming that this is in the US, one of the major parties relies on keeping people uneducated, so they don’t want people to pursue higher education. And certainly do not support cancelling student debt.
Im not sure where they’re referring to, but it’s the same, or similar at least, in the U.K.
That’s how they got Brexit and they’re pushing us to be right wing.
