Editorial Roundup: United States
Excerpts from recent editorials in the United States and abroad:
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Nov. 17
The Washington Post on a way forward for student loan relief
Many Democrats thought President Joe Biden’s efforts to forgive vast swaths of student debt would be both good policy and good politics. But their hopes of winning over young voters by relieving college loan burdens did not pan out. The Democratic ticket not only failed to make any gains among 18-to-29-year-olds relative to its 2020 performance but also lost ground in the age group.
Student debt remains a real issue: The $1.6 trillion in federal loans weighing on 42.8 million borrowers acts as a drag on the economy and has trapped millions of Americans in cycles of long-term default. However, Democrats, and everyone else, must learn two lessons from Mr. Biden’s experience: Blanket relief for borrowers, regardless of their income and ability to pay, strikes many voters, correctly, as inefficient and inequitable. And reforming the student debt program is a job best done in the halls of Congress, not the Oval Office.
Mr. Biden’s initial attempt to cancel almost $400 billion in loans — which the Supreme Court rejected — stretched executive power beyond appropriate constitutional bounds. It was also regressive, since it used tax dollars drawn from the general population to subsidize debts freely undertaken by people who gained enhanced earning power as a result. For many Americans who had already paid off their debts, the policy felt unfair. Even for intended beneficiaries, the disappointment of its failure outweighed any goodwill Mr. Biden might have earned in trying to help. A survey in June found that fewer than one-third of U.S. adults approved of how he handled the issue. Forty percent disapproved.
After losing at the Supreme Court, Mr. Biden developed a more nuanced plan. His administration shifted toward a program called Saving on a Valuable Education, or Save. This program lowered monthly payments for people on an already existing repayment plan (called Revised Pay as You Earn, or Repaye) and shortened the amount of time that borrowers would need to make those payments before the remainder of the loan was canceled (from 20 or 25 years to just a decade). Those terms were expensive (about $230 billion over a decade, according to the Congressional Budget Office) and too generous: An Urban Institute analysis found that nearly half of bachelor’s degree recipients in the program would pay less than half of their loan. But at least they were better targeted to help student borrowers in need than Mr. Biden’s initial forgiveness ploy.
Still, even this more moderate approach has hit legal roadblocks. Federal judges blocked Save from moving forward after a group of Republican-led states claimed Mr. Biden’s program would deprive them of revenue. In August, the Supreme Court refused to intervene, so the plan is on hold. The litigation illustrates the futility of trying to reallocate hundreds of billions of dollars in public money via executive fiat, especially with conservatives firmly in control of the Supreme Court.
Mr. Biden’s plan was always at risk of being torn down by the next Republican administration. And that administration is now at hand, to be headed by President-elect Donald Trump, who has criticized Mr. Biden’s student loan policy as a “total catastrophe” and “unfair” to Americans who already paid off their loans. In Mr. Trump’s first term, he sought to increase monthly payments. Should he seek to do so again, student borrowers will have endured a roller coaster of complicated policy changes, threatening their financial stability.
The Biden administration did achieve some of its goals. It canceled more than $175 billion in student debt, primarily by reducing administrative hurdles in the Public Service Loan Forgiveness program, without running afoul of the courts. It also proposed new regulations that would crack down on for-profit schools, which account for a disproportionate share of loan defaults. However, because of the Democrats’ larger political defeat, these policies are now at risk of reversal under a Trump administration. And the task of devising a broader income-based debt relief plan remains. So, too, does the challenge of incentivizing colleges and universities to contain their ever-growing costs.
Mr. Biden’s Save program could be a good starting point for members of Congress to negotiate a more modest income-based repayment system that is fully paid for and targets the neediest, along with other higher-education reforms. Lawmakers should focus on expanding existing tuition assistance for low-income families, emphasizing aid, such as Pell Grants, that does not create future debt burdens. Such legislation would not only help graduates manage their loans, but also restore some faith among voters that student loan reform really is about good policy, not just good politics.
ONLINE: https://www.washingtonpost.com/opinions/2024/11/17/biden-student-loan-forgiveness-trump/
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Nov. 14
The New York Times on Donald Trump’s choices for national leadership
Donald Trump has demonstrated his lack of fitness for the presidency in countless ways, but one of the clearest is in the company he keeps, surrounding himself with fringe figures, conspiracy theorists and sycophants who put fealty to him above all else. This week, a series of cabinet nominations by Mr. Trump showed the potential dangers posed by his reliance on his inner circle in the starkest way possible.
For three of the nation’s highest-ranking and most vital positions, Mr. Trump said he would appoint loyalists with no discernible qualifications for their jobs, people manifestly inappropriate for crucial positions of leadership in law enforcement and national security.
The most irresponsible was his choice for attorney general. To fill the post of the nation’s chief law enforcement officer, the president-elect said he would nominate Representative Matt Gaetz of Florida.
Yes, that Matt Gaetz.
The one who called for the abolishment of the F.B.I. and the entire Justice Department if they didn’t stop investigating Mr. Trump. The one who was among the loudest congressional voices in denying the results of the 2020 election, who said he was “proud of the work” that he and other deniers did on Jan. 6, 2021, and who praised the Capitol rioters as “patriotic Americans” who had no intention of committing violence. The one whose move to oust Speaker Kevin McCarthy in 2023 paralyzed his own party’s leadership of the House for nearly a month.
Mr. Gaetz, who submitted his letter of resignation from Congress on Wednesday after his nomination was announced, was the target of a yearslong federal sex-trafficking investigation that led to an 11-year prison term for one of his associates, though he denied any involvement. The Justice Department closed that investigation, but the House Ethics Committee is still looking into allegations of sexual misconduct, illicit drug use, improper acceptance of gifts and obstruction of government investigations of his conduct. Kevin McCarthy, the former House speaker, blamed Mr. Gaetz for his ouster, on the grounds that Mr. Gaetz “wanted me to stop an ethics complaint because he slept with a 17-year-old.”
This is the man Mr. Trump has selected to lead the 115,000-person agency that he has called the most important in the federal government, a position whose enforcement role could cause the most trouble for any president with corrupt intent. Even for Mr. Trump, it was a stunning demonstration of his disregard for basic competence and government experience, and of his duty to lead the executive branch in a sober and patriotic way. It will now be up to the Senate to say he has gone too far and reject this nomination.
Mr. Trump’s list of appointments is just getting started but already includes two other unqualified nominations that he announced this week: former Representative Tulsi Gabbard for director of national intelligence, and Pete Hegseth to be secretary of defense.
Ms. Gabbard, who previously represented Hawaii in the House and regularly appears on Fox News, is not only devoid of intelligence experience but has repeatedly taken positions in direct opposition to American foreign policy and national security interests. She has appeared on several occasions to side with strongmen like President Vladimir Putin of Russia and President Bashar al-Assad in Syria.
Mr. Hegseth, a co-host of “Fox & Friends,” is perhaps even more unqualified, given the gravity — not to mention the budget — of the post he would assume. He enjoys some support from enlisted service members and veterans, but outside of serving two tours as an Army infantryman in Iraq and Afghanistan, as well as time at Guantánamo Bay, Mr. Hegseth has no experience in government or national defense.
“He’s never run a big institution, much less one of the largest and most hidebound on the planet,” the editorial board of The Wall Street Journal wrote Wednesday. “He has no experience in government outside the military, and no small risk is that the bureaucracy will eat him alive.” The board went on to call Mr. Hegseth a “culture warrior” at a time when there are much bigger security issues for the Pentagon to be focused on.
It’s far from certain Mr. Hegseth could even obtain the security clearances required for the job. He has said he was one of a dozen National Guard members removed from service at President Biden’s inauguration in 2021 because of concerns that he was an extremist — possibly because of a tattoo he wears that is popular among white supremacists.
These are some of the most consequential roles in government, protecting the country from military and terrorist threats, investigating domestic criminal conspiracies, and prosecuting thousands of federal crimes every year. Yet to fill them Mr. Trump has resorted to people whose only eligibility for office is an apparent willingness to say yes to his every demand.
Mr. Gaetz in particular has joined Mr. Trump in expressing a commitment to exacting vengeance against anyone they believe has done them wrong. Mr. Trump began his campaign by saying “I am your retribution,” and Mr. Gaetz broadcasts nothing so much as that. He has no business leading an agency with the role of combating crime, fraud, violations of civil rights and threats to national security, among many other things.
In Mr. Trump’s first term, the department was protected by career prosecutors and other civil servants who understood that their primary obligation was to the dictates of the Constitution, not to the whims of the president. But Mr. Trump has promised to purge people like that from his second administration.
The possibility of extreme appointments like these was the reason the Constitution gives the Senate the right to refuse its consent to a president’s wishes. Last week, Republicans won control of the chamber. Now they will be confronted with an immediate test: Will they stand up for the legislative branch and for the American system of checks and balances? Two Republican senators, Lisa Murkowski of Alaska and Susan Collins of Maine, have already expressed strong skepticism of Mr. Gaetz’s nomination, and others have declined to express their support.
Mr. Trump clearly expects the Senate to simply roll over and ignore its responsibilities. He wants to turn the leaders of major important agencies into his deputies, remaking the federal government into a Trump Inc. organization chart entirely subordinate to him. He recently demanded that the Senate give him the ability to make recess appointments, a way of bypassing the Senate’s consent process when the chamber is adjourned for 10 days or more.
Even Republican senators refused to consent to that demand during his first term, to preserve their constitutional role, and on Wednesday Senate Republicans voted to reject as their leader Rick Scott of Florida, who said he would have no problem allowing recess appointments. Instead they chose John Thune of South Dakota, who is far more likely to uphold his chamber’s right to refuse consent of president nominations.
In Mr. Trump’s second term, senators will immediately be confronted with an extreme set of appointments even worse than those of the first term. That makes it all the more important that they preserve the ability to say no.
ONLINE: https://www.nytimes.com/2024/11/14/opinion/editorials/matt-gaetz-nomination-senate.html
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Nov. 14
The Boston Globe on extending federal Pell grants to short-term workforce training
Benjamin Franklin Cummings Institute of Technology, a private two-year college in Boston, offers an 800-hour certificate program in HVAC and refrigeration. President and CEO Aisha Francis said she’d like to break out segments of the program to create continuing education classes for HVAC technicians seeking to improve their skills — for example, offering a class in heat pump installation. But the school, which attracts primarily Black and Latino men interested in the trades, can’t make it work financially. About half the school’s students receive federal Pell grants to help finance their education, and short-term certificate classes are ineligible for Pell funding.
“Most of our students are very low income, so even though they want the skill set, they’re not able to pay for them,” Francis said.
Many fields today are facing workforce shortages. At the same time, there are students seeking a quick credential to enter the job market. Short-term certificate programs can help students get an entry-level job or gain new skills. For example, a student interested in medicine can train as a certified nursing assistant or emergency medical technician, then earn money while deciding whether they want to continue climbing the health care career ladder.
Yet federal Pell grants — the major source of financial aid for low-income students — aren’t awarded for programs that are shorter than 600 hours or less than 15 weeks. That leaves low-income students, who are often those seeking certificates, scrambling to pay out of pocket and schools searching for alternative funding. Schools may offer fewer courses because interested students can’t afford to pay.
Congress has been considering bipartisan bills to expand Pell eligibility for short-term classes. Passing legislation would be a win for Republicans advocating for more workforce-related education and for Democrats seeking to expand educational access for low-income students. More importantly, it would help students gain marketable skills and employers fill open jobs.
While legitimate concerns have been raised about ensuring that Pell-eligible credential programs are high-quality, legislation could address those concerns by establishing objective standards programs must meet. For example, programs that train students for a licensing exam could only retain eligibility if a certain percentage of graduates pass the exam within a reasonable time frame after graduation. Other metrics could involve job placement rates, program completion rates, or enhanced earnings.
“It’s increasingly clear that most jobs require some degree of postsecondary training, and it’s been hard to develop viable alternative pathways to college for students who are not enrolling in four-year degree programs without financial support,” said Martin West, academic dean at the Harvard Graduate School of Education. Expanding Pell, West said, “could create innovation in that space.”
Francis said Franklin Cummings Tech would offer more classes in construction-related fields like land surveying or blueprint reading if they were Pell eligible. And she expects that some people who earn short-term certificates would advance to other degrees. “We know these kinds of measures actually push more people into higher education,” Francis said. “It’s just a matter of will. Do we want to help more people get better educated or not?”
The biggest proponents of expanding Pell have been community colleges. At North Shore Community College, around 500 students are enrolled in short-term professional programs in areas like health care and information technology. Jennifer James Price, assistant vice president of employer relations for the college, said she works with local hospitals, community health centers, and nursing homes, which are desperate for nursing assistants, phlebotomists, and other program graduates. To pay for these programs, the school has been chasing grants, but those aren’t reliable, and tuition for a health care certification can cost up to $3,000. (The state’s free community college program also doesn’t apply to certificate classes.) “It doesn’t build a steady expectation for students or businesses in the North Shore where (classes are) happening at a low cost all the time,” Price said.
There is evidence that paying for workforce training works. In fiscal 2023 and 2024, Massachusetts created a $15 million state fund to pay for workforce training in high-need fields at community colleges. According to a report by the Massachusetts Association of Community Colleges, 3,359 students completed these programs, the majority of them in health care, and 2,404 of those graduates (66 percent) found a job or were enrolled in continuing education within 90 days of program completion.
Bills introduced in Congress would authorize Pell grants for students enrolled in programs with at least 150 hours, with guardrails to ensure the programs are high-quality and fulfill employer needs. There has been some dispute over whether to include for-profit colleges, which have historically charged students more money than nonprofits with worse outcomes. Guardrails that restrict eligibility to programs that meet objective criteria — like the ability to pass a licensing exam or get a job — would address concerns about quality, regardless of tax status.
There would be an estimated $1.7 billion cost to US taxpayers over 10 years, according to the Congressional Budget Office. As the House considered advancing the bill earlier this year, Republicans inserted a poison pill, proposing to pay for the expansion by restricting federal loans to students at schools with large endowments. Give the size of the federal budget, experts say there are undoubtedly other, less controversial sources of money that can be tapped to pay to expand Pell, which is already an approximately $25 billion-a-year program.
Expanding Pell eligibility to short-term certificate programs would help students, schools, and employers. Congress should resist the temptation to play politics and pass the policy.
ONLINE: https://www.bostonglobe.com/2024/11/14/opinion/pell-grants-short-term-certificate-workforce/
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Nov. 17
The Wall Street Journal says economic disruption is bad policy for Donald Trump
Donald Trump ’s cabinet nominees so far reveal a desire to disrupt Washington, and disruption is needed in many places. But as he mulls his choices for Treasury and the economic-policy posts, the question markets will ask is whether he will disrupt the policy mix that was successful in his first term.
The voter election surveys make clear that Mr. Trump won his second term above all else on the economy. Voters rejected the results of Bidenomics, especially inflation and a decline in real incomes. They recalled the strong investment and job market and rising wages across all income levels of the pre-Covid economy. Mr. Trump’s second term success or failure will depend on restoring those results.
That’s the hope behind the market’s bullish initial response to Mr. Trump’s re-election. Investors anticipate a return of animal spirits as the pall of Democratic tax increases and regulatory coercion is lifted. But economic and financial risks remain, and they’ll require careful judgment, not blow-it-all-up rhetoric.
That’s why it’s strange to hear Elon Musk lobby Mr. Trump that the next Treasury secretary shouldn’t be someone who favors “business as usual.” What he means by that isn’t clear beyond favoring one personality over another, and Mr. Musk may not know. Fiscal and monetary policy aren’t his specialty.
Our concern isn’t personalities so much as Mr. Musk’s apparent belief in economic-policy disruption for its own sake. Treasury isn’t the Education Department, or Defense, and financial markets don’t want to trade one form of policy uncertainty for another. Steady and knowledgeable economic policy hands are needed if Mr. Trump wants to succeed.
One risk ahead is the tax bill that needs to pass next year to extend the 2017 tax reform. With narrow GOP majorities in Congress, that won’t be easy. All the more so because Mr. Trump campaigned on new tax cuts (on tips, overtime, Social Security benefits) that will be impossible to afford unless Republicans want to sign up for an even larger deficit blowout than under President Biden.
Extending the 2017 reform more or less intact might be the best policy. That reform has recouped more tax revenue than the critics and Congressional scorekeepers claimed, and it will continue to do so if the economy keeps growing. But piling on too many tax giveaways that won’t improve the incentive to work and invest could make tax reform difficult to pass and spook the bond markets. The U.S. deficit as a share of GDP in the last fiscal year was 6.4%, which is unheard of in a growing economy without a war or pandemic.
We assume someone has told Mr. Trump that disinflation seems to have stalled. Long bond rates have climbed since the Federal Reserve cut short-term rates by 50 basis points in September. The 10-year Treasury yield is now above 4.4%, while the average 30-year mortgage rate is nearing 7.5%, higher than on Election Day. This means the Fed’s rate-cutting spree may soon have to end, lest inflation make a comeback on Mr. Trump’s watch.
The largest uncertainty is the President’s trade policy. There’s no doubt he will impose tariffs of some kind on Chinese goods and seems determined to impose some broader tariff across all imports. Whatever one thinks of tariffs as a policy tool, they add uncertainty to business investment decisions.
CEOs whose companies might be affected will wait on investments until they see the policy. Even then, they have to be wary about retaliation by other countries that might affect their exports or their ability to import components. This will slow the return of animal spirits.
Unlike other policy positions, the Treasury Secretary needs an understanding of financial markets, which nowadays are global. A blowup in the foreign-exchange markets somewhere can affect the U.S. economy, and new financial investments like crypto need careful watching. Mr. Trump has promised to ease political control over these markets, but no one should think they are risk free. Blowups somewhere are inevitable, and a Treasury secretary needs the experience to deal with the fallout in a way that reassures markets.
Mr. Trump’s first term until Covid was an overall economic success, as his tax reform and deregulation overcame the drag from tariffs. Markets responded well to his victory because they hope for a repeat. But that requires sound policy, not willy-nilly disruption.
ONLINE: https://www.wsj.com/opinion/disruption-wont-work-at-treasury-trump-nomination-musk-63c5b8f9?mod=editorials_article_pos1
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Nov. 15
The Guardian says rich nations in the global north owe “climate debt” to poorer nations
More than a century of burning coal, oil and gas has fueled intense heatwaves, prolonged droughts, heavier rains and devastating floods. To prevent even more severe impacts, the UN global climate summit, Cop29, must deliver tangible results to keep global temperature rises below 2C – the limit defined in the 2015 Paris agreement. Achieving this goal means human societies can only emit a finite amount of additional carbon dioxide, known as the world’s “carbon budget”.
Developed nations have exceeded their carbon budgets, while developing countries remain within theirs. Carbon dioxide lingers in the atmosphere for centuries, turning past unchecked fossil fuel use into a costly planetary bill. Between 1870 and 2019, the US, EU, Russia, UK, Japan, Canada and Australia – home to just 15% of the global population – accounted for over 60% of atmospheric carbon dioxide, according to the Delhi-based Centre for Science and Environment.
This underscores the climate debt that rich nations in the global north owe to poorer nations. This reality – rather than oil and gas lobbying – should focus minds at Cop29 in Azerbaijan, where leaders must forge a new global climate finance plan by next week. Economists estimate that developing nations need $1tn annually by 2030, a figure that reflects the scale of the climate crisis. Yet there is little sign the rich world will contribute its fair share.
A stronger, more unified approach is needed. Many of Africa’s environmental NGOs argue that the continent has been sidelined in global industrial shifts, particularly in green industrialisation, due to its lack of a robust manufacturing base and its role as a raw materials supplier. While advanced economies dominate green innovation, Africa faces significant hurdles, including limited technology transfer, expensive financing and weak governance.
The economist Fadhel Kaboub, who advises the Kenyan thinktank Power Shift Africa, sees Cop29 as an opportunity to strike a transformative deal – if the global south can unite and negotiate for the technology and resources it needs to reposition itself in the world economy. Prof Kaboub describes the current climate finance model as “economic entrapment”. The evidence is stark: Africa holds 40% of the world’s renewable energy resources but attracts just 2% of global investments. With 20 out of 38 low-income African nations in or near debt distress, high borrowing costs and a shrinking manufacturing base leave the continent dependent on imports for life’s essentials.
These challenges span the developing world, demanding grants, technology transfers and debt cancellation. Prof Kaboub says Donald Trump’s return to the White House could be a chance for countries in the global south to cooperate and forge a bold deal: to double their industrial footprint with green growth, powered by western technology, in exchange for critical minerals essential for the rich world’s energy transition. Africa, holding 20% to 90% of global reserves for 11 such minerals, could lead this shift. The outcome? A greener, richer world, with developing nations becoming key markets for foreign goods and services.
Mr Trump may find the allure of crafting the “ deal of the century” impossible to resist. Others – such as the EU or China – might also be ready to take up such an offer. Cop29 must mark a turning point where developing nations, united, demand a fair and transformative global partnership for a sustainable future. The stakes couldn’t be higher, and neither could the opportunity to reshape the future.
ONLINE: https://www.theguardian.com/commentisfree/2024/nov/15/the-guardian-view-on-un-climate-talks-rich-and-poor-nations-can-strike-a-win-win-deal
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By The Associated Press
