How the U.S. Government Could End the Student Debt Crisis Today


Yes Magazine has the article How the U.S. Government Could End the Student Debt Crisis Today.

Instead of loaning students money, the federal government could just pay for their tuition, without causing any significant economic problems.

This is a great article, so read it for the explanation of how we could make America great again.

There is one flaw in it that is typical of how Progressives try to educate people on the way the economy works. We need to get over doing this because being honest never hurts.

To prove that inflation isn’t caused by government deficits, we talk about the inflation of the 1970s caused by OPEC, but not the U.S. government. If people remember their history and the guns and butter policy during the Vietnam War of LBJ (Lyndon Johnson), then they will claim that LBJ actually started the inflation. They would be right. We don’t have to shy away from this fact. We can use it as a teaching tool of what happens when we do actually try to use more resources than the economy is capable of supplying. LBJ wanted to fight a very expensive war in Vietnam, far more expensive than our wars in Iraq, Afghanistan, Syria, Lebanon, and Yemen, to name just a few. However, LBJ did not want to disturb the lives of civilians (other than sending their sons and daughters off to die in a war.) So LBJ refused to use taxes to siphon off demand for resources from the private sector so he could use those resource in the war.

We could talk about the tremendous rise in industrial productivity since the days of LBJ. Right now we are closing factories and putting people out of work because the economy is capable of producing so much more than we are able to buy. This is the very time (as opposed to LBJ’s time) when the government needs to be boosting people’s purchasing power, not reining it in. How do we permit our politicians to apply economic “solutions” appropriate for another season at exactly the wrong moment in history? LBJ should have been reining in private demand instead of promoting it, and now we should be promoting private demand instead of trying to force austerity through budget balancing efforts.

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