Much of the debate about student loans is framed in terms of financial statistics. We hear that we have $1.6 trillion of debt outstanding, or that the income-driven repayment programs might cost taxpayers $100 billion or more, or that there’s a $500 billion “hole” in the system, or that canceling $50,000 of debt per person might cost $1 trillion. Estimates like these purport to frame contested policy choices in terms of hard dollars, with the clear inference that policies like one-time student loan cancellation or expanded income-driven repayment programs are simply unaffordable.
There’s only one problem: These numbers are made up. They are mere artifacts of a series of policy and modeling choices, with little basis in the reality of personal or public finance, or the costs and benefits of higher education. There are real dollars involved, to be sure, but quoted dollar amounts like those above are based on a lie—really a series of lies.
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