3 ms·

I would say it is a way to boost the dollar. The alternative is everyone paying the education year by year, as taxes, during their lives as citizens. But here t

I would say it is a way to boost the dollar. The alternative is everyone paying the education year by year, as taxes, during their lives as citizens. But here there are people who are forced to pay it all in one go. So this boosts the short-term demand for dollar, more than if it was spread out as a life-long tax. So it seems to me, all well-off Americans benefit, and it is at the expense of the poor, and the competing currencies. It doesn't matter if some default, as long as most pay it off. But I'm not an expert. It's just a thought.

branchless 11y ago
It pushes higher money creation at the point of inception. Debt can be created instantly and enters the system and becomes "dollars" as another account is credited to balance. Then over the lifetime of the ex-student they pay back this "money" plus interest which destroys the principal and consumes existing "money". It should be noted that the creation of the debt benefits "growth" in the present electoral cycle whilst the repayment occurs mostly in other electoral cycles.