DiscoverFreakonomics Radio377. The $1.5 Trillion Question: How to Fix Student-Loan Debt?
377. The $1.5 Trillion Question: How to Fix Student-Loan Debt?

377. The $1.5 Trillion Question: How to Fix Student-Loan Debt?

Update: 2019-05-0929
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As the cost of college skyrocketed, it created a debt burden that’s putting a drag on the economy. One possible solution: shifting the risk of debt away from students and onto investors looking for a cut of the graduates’ earning power.

Comments (2)

Joseph Hawkins

There are huge swaths of the economy that are stagnating due to a currency deficit. When there are residential solarpanels to install, industrial hemp to commoditize, thorium reactors to build, waste materials to recycle, electric vehicles to subsidize and much much more, our government seems compelled only to spend tens of trillions of dollars on bank failures and endless war. Religiously bankrolling these illicit and corrosive schemes breed an economy where the military industrial sector consumes ever more resources and the financial sector extracts ever more liquidity, placing the overall economy at ever greater risk. Rather than providing bombs to drop on others and austerity for us, our government needs to provide meaningful wages for those willing to work on what has to get done, translating into a more productive and sustainable economy for everyone.

Jul 20th
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Joseph Hawkins

For all those who still insist on microeconomics masquerading as Macroeconomics, here is a quick primer of Macro 101 below. Money is a social unit of account having a fiscal/tax relation between the issuer of the currency and it's users, where spending precedes taxation. Government expenditures and not taxes pay for entitlement/discretionary spending and interest on the debt. Demanding that taxes be paid, and in dollars, insures the validity of the dollar as the means of exchange. Deficit Spending is the government spending more money into the economy then it taxes back out. Government deficits provide the liquidity necessary for the economy to function. Taxes are vital for restraining concentrations of wealth and include capital gains, dividend, corporate, inheritance, estate and a progressive income tax. The National Debt is the amount in dollars spent into the economy that the government buys back in exchange for Treasury securities, essentially transferring money from checking to savings. Inflation is a rise in prices across the economy due to a shortage of resources and/or productive capacity. Hyperinflation is a collapsing value of the currency across the economy due to a collapse in resources and/or no productive capacity. Stagflation is a rise in prices, compounded with a decline in economic activity across the economy due to the scarcity of a vital resource. Recessions are cyclical contractions of liquidity across the economy that cause a corresponding decline in economic activity. Depressions occur when the government runs a surplus, starving the economy of liquidity that cause deep and systemic unemployment, and an unsustainable escalation in private debt. Depressions are avoidable, so long as the government spends the necessary money to actualize full employment, which can include a job guarantee, student debt forgiveness and a Green New Deal.

Jul 20th
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377. The $1.5 Trillion Question: How to Fix Student-Loan Debt?

377. The $1.5 Trillion Question: How to Fix Student-Loan Debt?