• Posts
  • RSS
  • ◂◂RSS
  • Contact

  • Debt Relief Is Bad Means Testing

    January 22nd, 2013
    giving, money  [html]
    Forgive student loans! End foreclosures and let people own their homes free and clear! Allow the free coinage of silver! The idea of reducing debt, either outright through forgiveness or indirectly through inflation has a long history. It's easy to see the appeal: forgiveness sounds merciful, people with debt seem particularly deserving, and lenders are unsavory. This comes down to moving money to debtors from lenders, the government [1], or donors.

    The "give people money and they will be better off" approach is a good one, but who should get the money? Student loan forgiveness primarily helps people who went to college; what about people who couldn't afford college in the first place, even without loans? People with mortgages to forgive are people with houses, but lots of people are too poor to own. The "has debt" criterion is not a good proxy for "needs our help".

    If we're going to give people money, the government would do better to expand the EITC (or institute a negative income tax). Individual donors would do better with unconditional cash transfers with targeting like "people in Kenya with thatch roofs". Targeting based on "do you have debt" is worse than our societal default of "is your income below $X".


    [1] A major lender in itself.

    Comment via: google plus, facebook

    Recent posts on blogs I like:

    Fireside Friday, November 27, 2020

    Hey folks! Fireside this week. A bit of a change-up in terms of the coming attractions. I had planned to start “Textiles, How Did They Make It?” next, but I want to do a bit more reading on some of the initial stages of textile production (that is, the pr…

    via A Collection of Unmitigated Pedantry November 27, 2020

    Building Depth and Window Space

    How much window space does an apartment need, relative to its area, and how does this affect building style? A fascinating post from about a year ago on Urban Kchoze makes the argument that modern North American buildings are too deep – Simon calls them o…

    via Pedestrian Observations November 27, 2020

    Thoughts you mightn't have thunk about remote meetings

    Welcome to this week's edition of "building a startup in 2020," in which all your meetings are suddenly remote, and you probably weren't prepared for it. I know I wasn't. We started a "fully remote" company back in 2019, but …

    via apenwarr November 23, 2020

    more     (via openring)


  • Posts
  • RSS
  • ◂◂RSS
  • Contact