The belief that student debt was created by "the elites" in order to ensure that graduates would become yoked to the workplace as obedient, hard working labor, is not only widespread but is espoused even by prominent public intellectuals like Noam Chomsky. It shares two flaws of bad reasoning: ignoring the obvious and embracing positive evidence uncritically.
[Disclaimer: I don't know whether their theory is true. Truth is almost always a bit of a mystery. What follows is an explanation why anyone who believes this theory hasn't bothered to think it through, and likely embraced it for the sake of some political or ideological bias, since the belief is contradictory and inconsistent in itself. IOW, it's a stupid belief, true or not, so you shouldn't buy it and if you do buy it it's time to reflect on why you're not thinking.]
First, the debtors, by assumption, must use their wages to pay off their debt rather than spend their wages elsewhere. So every dollar siphoned into paying debt is a dollar that is not being spent in the productive economy -- purchases of consumables or assets like a house. This debt servicing certainly benefits the financial interests, but not the interests of the productive economy or vendors of consumables or assets. The theory implies that corporations that make stuff and sell stuff are not among the elites. Musk, Bezos, Cook, the Kochs and the Waltons would then not be included among the elites. It also implies the "the elites" want to suppress the productive economy. No one who holds this theory has ever complained that the theory implies that "the elites" have as their intention to undermine the corporations that make and sell. But that's exactly what this theory entails.
Second, again by the theory's premise, if the debt did not exist, the graduate would simply work less. But is there any evidence that this is true? Would you work less, or would you spend more? Would you find an apartment without roommates or a larger living space or a nicer place in a more interesting neighborhood? Or would you stay where you are, deal with your four roommates, refrain from getting married and have kids, just to work less or take a pay cut for a more relaxed work environment? When choosing a job, which is more important, better pay or less work? Human desires are unbounded. Did the GI Bill result in lower work hours? On the contrary, veterans can't find jobs that match their level of education. They are not choosing to work for less, they're forced to.
Inflation, btw, belies the "more money, less work" prediction. It tells us, "more money, more spending".
The underlying flaw in this conspiracy theory is the assumption that "the elites" are a monolith with a coherent program. That just isn't so. Debt benefits banks, but hurts the productive economy. Rents benefit landowners, but not the rest of the consuming economy -- that's an old Henry George observation. A burgeoning productive economy would benefit the banks, since there'd be more interest in investment and debt, and benefit real estate as well if wages rise. Everyone benefits from the productive economy -- the owners of capital, labor, finance and real estate. But student debt benefits only finance, not real estate, not the productive economy and certainly not wages or labor. So student debt is not a coherent program for anyone except banks, and banks would benefit without it anyway.
The divisions among "elites" extends further. Purchasing from Amazon is a loss to brick-and-mortar stores like Wal-Mart. Does that mean Wal-Mart is not among the elite? Or was it elite but no longer? GE used to be the giant among corporations, not anymore. And where are the railroad magnates today? They are not the owners of auto factories. Schumpeter described this ongoing shift among corporations, creative destruction. That's a good theory. And it's not a conspiracy of "elites". It's an observation of an emergent, distributed property, like the economy itself. Consumers like innovations that benefit them. No "elite" is forcing it on them. The market closely follows consumer desire, rarely the other way around.
When someone blames whatever on "the elites", ask, "Which elites?" There are many. And the conspiracy theorist's favorite advice "follow the money" all too often looks only upwards, ignoring the vast aggregate distributed funds in the consumer's aggregate pocket.
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