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Inflation is already debt forgiveness. Since my subsidized loans had interest well below inflation, I decided to pay the absolute minimum possible payment on t

Inflation is already debt forgiveness. Since my subsidized loans had interest well below inflation, I decided to pay the absolute minimum possible payment on them for last 9 years. In that time, they have lost 37% of their real value just through inflation alone. I always felt bad for my friends who insisted on paying off their loans as soon as possible. And now, mine are about to disappear completely for free!

codefreeordie 4y ago
In today's society, working hard is always a bad investment. The more you work, the more you create, the more punishment accrues to you. The way to a happy and successful life today is to make sure never to work hard at anything so that you qualify for all the goodies
- IceMetalPunk 4y ago
  Ah, yes, the American Dream: success is all about hard work, therefore unsuccessful people just aren't working hard enough. So the only people who benefit from policies like these are irresponsible people who didn't work hard enough and now want "goodies".
krapp 4y ago
>Inflation is already debt forgiveness. No matter how many threads you say this in, it isn't going to be true.
- crhulls 4y ago
  It is implicitly true. There used to be an informal social contract that the dollar had value, that the government would protect this value, and that there would be a free market that would provide a time value of money. Governments, businesses, individuals and reckless borrowers of all stripes - not just students - have been massively rewarded by our current policies from both the left and the right where there is no longer accountability. We make money free so the market doesn't crash. This is so sad and leads to the cynicism and distrust so many of us have towards our institutions today.
- nsv 4y ago
  Could you elaborate on why that is?
  - krapp 4y ago
    Because no matter how much the dollar depreciates, the amount of debt itself always increases, and the actual dollar amount of the debt is what people pay. The fact that $50,000 in debt is worth 10% less than $50,000 x years ago does not mean $5,000 of that debt was "forgiven." And even if that were the case, then interest on that debt would easily cancel the effect out, since interest far outstrips inflation on many student loans. Arguing that student loans are "forgiven" and that no action needs to be taken because deflation is solving the problem, despite the crushing weight of that debt on so many borrowers even when they're trying to work it off, is twisted logic.
    - legitster 4y ago
      > actual dollar amount of the debt is what people pay Exactly right! A loan is a time capsule of prices. Wouldn't you rather buy a house 30 years ago than right now? > interest far outstrips inflation on many student loans Maybe on some, but not on the federally subsidized student loans we are talking about here. My interest is something like 2.25% (not including the 2 years payments have been frozen). Even when inflation was pretty stagnant, you would be hard pressed to find many years below that.
    - josephcsible 4y ago
      Consider an extreme example. You take out a $300,000 loan to buy a house. The next day, there's suddenly hyperinflation and now $300,000 is the average price of a meal, or less than most people earn in an hour. You basically got a free house.

codefreeordie 4y ago

In today's society, working hard is always a bad investment. The more you work, the more you create, the more punishment accrues to you. The way to a happy and successful life today is to make sure never to work hard at anything so that you qualify for all the goodies

IceMetalPunk 4y ago
Ah, yes, the American Dream: success is all about hard work, therefore unsuccessful people just aren't working hard enough. So the only people who benefit from policies like these are irresponsible people who didn't work hard enough and now want "goodies".

krapp 4y ago

>Inflation is already debt forgiveness. No matter how many threads you say this in, it isn't going to be true.

crhulls 4y ago
It is implicitly true. There used to be an informal social contract that the dollar had value, that the government would protect this value, and that there would be a free market that would provide a time value of money. Governments, businesses, individuals and reckless borrowers of all stripes - not just students - have been massively rewarded by our current policies from both the left and the right where there is no longer accountability. We make money free so the market doesn't crash. This is so sad and leads to the cynicism and distrust so many of us have towards our institutions today.
nsv 4y ago
Could you elaborate on why that is?
- krapp 4y ago
  Because no matter how much the dollar depreciates, the amount of debt itself always increases, and the actual dollar amount of the debt is what people pay. The fact that $50,000 in debt is worth 10% less than $50,000 x years ago does not mean $5,000 of that debt was "forgiven." And even if that were the case, then interest on that debt would easily cancel the effect out, since interest far outstrips inflation on many student loans. Arguing that student loans are "forgiven" and that no action needs to be taken because deflation is solving the problem, despite the crushing weight of that debt on so many borrowers even when they're trying to work it off, is twisted logic.
  - legitster 4y ago
    > actual dollar amount of the debt is what people pay Exactly right! A loan is a time capsule of prices. Wouldn't you rather buy a house 30 years ago than right now? > interest far outstrips inflation on many student loans Maybe on some, but not on the federally subsidized student loans we are talking about here. My interest is something like 2.25% (not including the 2 years payments have been frozen). Even when inflation was pretty stagnant, you would be hard pressed to find many years below that.
  - josephcsible 4y ago
    Consider an extreme example. You take out a $300,000 loan to buy a house. The next day, there's suddenly hyperinflation and now $300,000 is the average price of a meal, or less than most people earn in an hour. You basically got a free house.