Perhaps this is the only true law of political economy: Memories are short and lessons are never learned. At any rate, I thought of it as soon as I saw a front page advertisement in the Irish Times, taken out by the Irish Civil Public and Services Union (CPSU).
This weekend The New York Times presented an article about the current structure of student loan programs. Briefly: because of changes and tweaks to preexisting law, student loan payments are capped at ten percent of income, and debtors are eligible for nontaxable loan forgiveness on the balance after twenty years, or after ten years if they have a government or public interest job.
The enthusiasm of the Times reporter for this development slights three major problems with it. First, differential forgiveness could distort choices in the labor market, to the disadvantage of the private sector.