After PHENOM’s annual Advocacy Day on March 5th, one of the most important asks was the support of the Fair Share Amendment. The Fair Share Amendment is a constitutional amendment to be voted on in the 2018 November election that would add an additional four percent tax on yearly incomes $1 million or more. The tax would bring in about $2 billion in revenue and would be distributed to public education and infrastructure. With more funding from the Fair Share Amendment, students at public universities would see notable decreases in tuition, or even the complete waiving of tuition all together for instate students (such a proposal would amount to an estimated $800 million).
Advocating for Fair Share is not so much an argument for redistribution as it is for acknowledging that burdening students with tens of thousands of dollars of debt is one of the most irrational aspects of our public education system. If everyone immediately stopped student loan payments, we would all be better off.
Student loan payments reduce potential consumption spending by $2.8 billion every year in Massachusetts. If instead, households kept their money, about $2.6 billion would go to spending, a nice stimulus for local, state, and national economies, and the rest would go to savings, fueling business investment.
Tuition and fees are clogging productive economic activity from happening. For the state, that’s future tax revenue (that could go to public higher education). For everyone else, that’s jobs, homes, puppies, less stress, and anything that does not involve accumulating student debt.
If students (altogether) refused to pay back their debt, that may not be such a bad thing…
Of course, there should be a direct and reliable stream of state funding to eliminate tuition. That is why the Fair Share Amendment is crucial. But, as of right now, loan payments due to the high price to enter a public university are an absurd economic activity for anyone to justify.
Note: Panio Gianopoulos put together this interesting list of what could occur if everyone refused to payback their loans. In short, it’s best to find public funding as soon as possible
