There’s a paper on educational loan forgiveness from a pair of University of Chicago economists (PDF) that arrives at the same conclusion I did in examining the subject:
We find that universal and capped forgiveness policies are highly regressive, with the vast majority of benefits accruing to high-income individuals. On the other hand, enrolling more borrowers in IDR plans linking repayment to earnings leads to forgiveness for borrowers in the middle of the income-istribution.
Let’s put this very clearly. If you’re interested in welfare for the rich, you’ll support educational loan forgiveness programs. If you’re concerned about middle income people and income inequality and the drag on the economy provided by educational debt overhang you’ll support an income driven repayment program.
