One of Jill Stein’s favorite campaign lines is that her campaign is “the only campaign that will cancel all student loan debt”. This line is repeated over, and over, and over. By promising to ‘cancel’ student loan debt, Jill Stein seems to insinuate that she will automatically win her over young voters:
There are 43 million young people, and going into middle age and beyond, who are trapped in predatory student loan debt. They happen to be very well networked. They’re really good at self-organizing on the Internet. There’s only one place where they can put their vote in order to cancel their debt.
– Interview with Cenk Uygur of The Young Turks; June 8, 2016
This wasn’t an off-hand remark, either. Her campaign has propped up her promise of cancelling student debt as their catch-all plan to attract young voters to vote for the Green Party. Sure, this may be an unorthodox strategy and goes further than Bernie Sanders’s proposals for tuition-free higher education at public universities, but it’s based nowhere in reality.
Bernie Sanders, someone who Jill Stein often praises and even invited to be on her ticket, laid down concrete plans that reformed federal student loan interest rates, expanded refinancing opportunities, and provided a revenue structure. Jill Stein’s entire plan to solve the student debt crisis is to unilaterally cancel student debt via “quantitative easing”.
My campaign is the only one that will do for young people what our misleaders saw fit to do for Wall Street not that long ago when they bail them out to the tune of, like, 16 or 17 trillion dollars when you count all the free loans they got – but it was about 4 trillion dollars in free money in the form of so-called quantitative easing which is a magic trick that, basically, people don’t need to understand anymore about than that it is a magic trick.
– Interview with Cenk Uygur of The Young Turks; June 8, 2016
From this quote above it is very clear that Jill Stein has no wild idea what quantitative easing (QE) was or what it did. The Federal Reserve did not cancel out the debt of failing financial institutions as Stein has claimed they did. In that same interview with Fox Business, Stein claimed that QE “didn’t really strengthen our economy”, which is arguably false as QE – combined with other monetary policy tools the Fed instituted – was explicitly designed to strengthen the recession-hit economy.
Quantitative easing does not cancel debt, plain and simple. It simply involved the Federal Reserve buying back Treasury (and other) bonds from banks and other financial institutions in the open market using newly created (not printed) money. It doesn’t do anything to cancel debt, and it doesn’t change the net assets held by banks. Like lowering interest rates, QE is supposed to stimulate the economy by encouraging banks to make more loans.The idea is that banks take the new money and buy assets to replace the ones they have sold to the central bank. That raises stock prices and lowers interest rates, which in turn boosts investment.
It’s also important to note that quantitative easing was an extraordinary measure undertaken by the Federal Reserve and is not regarded as a routine policy tool that central banks use. Stein, on the other hand, talks about QE as if it was hastily put-together policy to unfairly bailout Wall Street crooks and led to trillions of dollars simply disappearing.
Maria Bartiromo: But they did pay the bailout back, Dr. Stein. The banks have paid the U.S. government.
Jill Stein: Yes, but, it took a while to do that. They paid back that $800 billion dollar TARP plan, that’s what they paid back, but they did not pay back the quantitative easing which was simply a cancellation of the debt.
Sigh
On it’s over 4 trillion dollar portfolio of securities, the Fed earned an average interest rate of about 3 percent, which generated $116 billion of interest in 2014. These “residual earnings” have been a significant source of revenue for the U.S. Treasury, cutting the 2014 federal deficit by nearly $100 billion. That is something that you cannot do with student debt and certainly was not a broad cancellation of debt.
Other than her wild QE “plans”, Stein’s website doesn’t list any more details about her higher education policies and proposals to solve the student debt crisis:
So far, I’ve only talked about Stein’s claims that quantitative easing can solve the student debt crisis, but I haven’t mentioned:
• Her assertion that the President can unilaterally order the abolishment of student debt with no mention of what constitutional powers grant that ability.
• Suggests that all millennials have student debt, are unable to pay it, and are unsatisfied with the debt plans offered by other candidates.
• Her tunnel vision on debt abolishment and lack of focus on tuition-free college plans, or degree inflation, or the predatory sales practices of private colleges.
• The appalling lack of any details of how this debt abolishment “plan” would work.
Unfortunately, there is no space in the Green Party for scrutiny of their candidate, lest you be labelled a Hillary shill and be shut out of their echo chamber.
Jill Stein and national Greens had an excellent opportunity to move to the Democrats’s left and offer innovative policies to easing student debt. Instead, they’ve chosen to run with a campaign message that makes for social media posts that sound good on the surface, but make for bad policy. Not only that, but the confidence the Stein campaign has – and by extension the Green Party movement in general – that they can magically win over young voters and sweep into the White House is patronizing and will not work.
We can see through the empty half-baked promises.