Anti-capitalist excesses of Nina Turner – student debt, minimum wage, universal income

Congressional candidate and former State Senator Nina Turner is against our economic system of capitalism. She wants to give away the entire federal budget to people, including $24,000 to do nothing, requiring $50,000 to flip burgers, free college for any length of time, and even free rent. It’s so much “free” money that it would fundamentally reshape our society, and thrust our country into an experiment that could lead us to dystopian downfall. Her ideas are radical, irresponsible, and extreme.

Universal student loan debt cancellation

Rising college tuition and student debt can be burdensome, and elected officials may assist these borrowers, but it’s important to be smart with any government funding. We should at least consider the needs of those we’re helping, and what behavior we’re incentivizing. Nina Turner doesn’t seem to care about these considerations, and instead just wants to drop everyone’s debt, all $1.75 trillion of it, regardless of their income or potential negative incentivization.

Who benefits?

She claims debt holders are mostly low or middle-income, but my review of the Federal Reserve’s 2019 Survey of Consumer Finances shows that only 65% of education debt holding families earn less than $100,000 per year and only 51% less than $75,000. That means over a third of universal cancelation recipients would be people making 6 figure salaries, and almost half are making enough money to support a family of five in Ohio.

Many of these wealthier debtors could afford to pay off their loans, but some choose to invest instead, to earn a higher interest rate than their loan’s interest costs them.

Furthermore, Brookings Institution says, “the highest-income 40% of households (those with incomes above $74,000) owe almost 60 percent of the outstanding education debt”. Universal cancellation would disproportionately benefit wealthier people.

If you’re going to provide debt relief, it’s more reasonable to limit it to those who need it most, rather than redirecting tax payers’ money to those who are already well off.

Turner says forgiving debts is simply helping people, but this could incentivize colleges to charge even more money, sending future students into even bigger debts. As much as she rails against rich, yacht-owning corporate executives, she should consider that OSU’s president makes $900,000 per year with another half million in yearly bonuses and benefits.

While Turner hopes to eventually make college free for everyone, that could also incentivize college executives to take as much money as they desire out of the pockets of tax payers.

Student responsibility

Turner blames student debt on “the system”, and places no responsibility on students, but her policy ideas risk encouraging students to take on even more debt than they can afford. While there are plenty of responsible student borrowers, there are also those who made some suboptimal choices: a major that isn’t likely to pay well, a university that’s much more expensive than others, too much partying leading to academic failure, etc. No one should treat all students as irresponsible slobs, but we can’t just ignore borrowers’ responsibility altogether either.

This well produced video of Nina Turner describes voluntarily taken loans as “punishment”, as an imposed lack of freedom. It features a musician with $120k in debt, who admits she thought it didn’t matter how much education costs, but blames it completely on bad policy. There’s also an artist with a master’s degree and $80k in debt, and another artist with a PhD and $250k in debt who spent 8 years completing the first 4 years of college. Folks should not expect to make hundred thousand dollar profits from the arts, and the government should not incentivize people to expect it either.

We should incentivize students to minimize their debt whenever possible: save up money before college, shop around to find a more affordable option (including online alternatives), avoid wasting time on indecisiveness, take a part time job while going to school, or choose a career that only requires an associates degree, certification, or no higher education. By paying off the debts of everyone, regardless of how responsible they were, we may encourage even more irresponsible financial decisions.

Morality, classism, racism?

She says student debt is immoral, but wouldn’t it to be worse to deny education to those who can’t afford it upfront, or to force teachers to work for free?

In Turner’s mind, the only way to be moral is for tax payers to fund all higher learning, regardless of quality, with no conditions or expectations of return on investment whatsoever. That includes more expensive ivy league schooling when community college would suffice, performing art degrees that don’t pay the bills, getting a degree out of curiosity with no intention of working in that field, luxurious campus life, exotic field trips, and lifelong students who never work. All of that sounds fun, but it’s ridiculous to think that other hard working Americans are morally obligated to foot the bill for every frivolity under the banner of “education”.

The value of higher learning varies wildly, and government investment should be targeted; focused on building up talent in essential but underserved careers, enhancing positive civic contribution, or offering direct pathways to self-reliance, without wasting money on creating more starving artists, unnecessary campus frills, or overpriced, low-demand, navel-gazing degrees.

She doubles down on the moralizing by saying that anything other than fully government-funded college is class-based discrimination and/or oppression. We already give everyone 12 years of free education, and she insists that only when 20+ years are covered can we be moral. What’s wrong with drawing a line in the sand to say a dozen years is a good foundation to level the playing field for everyone, but the rest is up to you? Perhaps we should focus on improving the first decade of free learning, so that fewer people need to keep studying before they can enter the work force.

Her moralizing goes even further, saying that cancelling “only” $10,000 is not just insufficient in her view, it’s also racist! Thousands of dollars of debt no longer have to be paid, equally available to all debtors, regardless of their race, gender, sexual orientation, or religion, but Nina Turner finds the forgiveness to be racially unfair.

One issue with the concept of systemic racism is that anything that doesn’t immediately end racial disparities is insufficiently anti-racist and therefore “racist”, even when it benefits plenty of people from racial minorities. Racial wealth disparities have historically been caused by explicitly racist laws and norms, but we can’t blame every modern non-discriminatory policy for that.

It’s wrong for Turner to insist that opponents of universal cancellation just want more suffering. Some just want it to be limited to the needy or structured to better incentivize more responsible borrowing. Some see the $1.75 trillion price tag as just too exorbitant, or may have better ideas for investing that money, like encouraging the creation of less expensive opportunities.

Ungrateful for partial forgiveness

She continues to treat $10k forgiveness as racist by saying that not giving Black advocacy groups everything they ask for is disrespectful to them. It’s wrong to suggest that the only way to respect Black people is to meet all of their policy demands.

Repayments were paused for 2.5 years to give people time to recover from the pandemic, a kindness granted by the government. It’s unfortunate that some people will be unhappy at being asked to eventually resume responsibility for the burden they had voluntarily taken upon themselves. While it’s not unreasonable for voters to look to President Biden to fulfill his campaign promise of $10k relief, the average borrower who owes more than twice that should really be expecting to resume payments at some point.

Turner has no gratitude for lowering the burden of debt holders unless she gets everything she demands.

Tying free money to protecting democracy

Turner insists that “canceling student debt is a matter of securing democracy”, but it’s problematic to attach a liberal spending agenda to protecting democracy itself. It’s true that the GOP under Trump’s leadership is a threat to our democracy, and that in our 2 party system the Democratic party is best positioned to tackle that threat. But we can’t just tell people that if you care about democracy, you must swallow every trillion dollar giveaway progressives have dreamt up.

That kind of thinking leaves pro-democracy conservatives and moderates with a very tough choice. This is especially true with cancelation by Presidential decree, since the executive branch isn’t supposed to have the authority to unilaterally drop billions owed to the government, without congressional approval, using “emergency” powers. You might even call such executive overreach undemocratic.

If the only way to get voters to care enough about protecting democracy and other civil rights is to give them free money, and they can’t be bothered to show up and vote otherwise, then it speaks poorly of Turner’s estimation of these voters.

Who pays for it?

Debt cancelation may not directly lead to an immediate tax increase, but losing $70 billion repayment revenue per year would cost some tax payers eventually, either adding to the deficit, raising taxes in the future, or cutting government services. It amounts to “creative accounting” to pretend there will be no fiscal impact whatsoever. One analysis says tax payers may end up shelling out an average of $2,500 to cover $10k debt forgiveness, which would be even higher under Turner’s universal plan. Perhaps she’s willing to pay that price for debt relief, but let’s at least be clear eyed about how much money is at stake.

She’s right that federal loans have actually cost the government more money than it has earned back in interest, but that’s mostly because of liberal policies where many borrowers are allowed to pay back less than they owe. If we cancel everyone’s debt, then it will be even costlier for the government than it is now, especially if we just continue to issue new federal loans and spend $88 billion per year on the Department of Education.

Biden forgives $10-$20k per student

On 8/24/22, Biden announced he is canceling $10,000 in student loan debts for individuals making up to $125,000. He’s also cancelling $20,000 for folks with Pell Grants.

• Congressman Tim Ryan: student loan forgiveness sends ‘wrong message’
• Senator Portman: Biden’s student loan debt transfer is an abuse of executive power
• David French for the Atlantic: Why Biden’s Debt-Relief Plan ‘Pings Our Sense of Unfairness’

Raising the minimum wage

Turner pushes for a $25 minimum wage. Raising the $7.25 minimum is overdue, but requiring too much would put restaurants and other small companies out of business, causing lost jobs and higher prices.

MIT’s Living Wage Calculator says an adult Ohioan with no children needs $15.61 to support himself, while 2 Ohio workers raising 1 child need to make an average of $17.50 each. The National Employment Law Project supports a $15 minimum. A house bill with 200 cosponsors (including Turner’s Democratic rival Shontel Brown) proposes to increase the minimum to $15 over 5 years.

Turner rejects this as insufficient.

Jumping to $25 is excessive. That means a worker with no training or work experience gets a $50,000 starting salary, more than some licensed nurses make!

In the 1930’s, President Franklin Delano Roosevelt did push for a minimum “living wage”, but he meant “non-starvation wages”, and the minimum was set to $5.22 in 2022 money, not modern standard of living wages.

There’s nothing wrong with making less than a living wage for a high schooler’s first job while living with his parents, or a young adult gaining work experience while living with a roommate. In fact, the average for one of the lowest paying jobs, fast food cook, is $11.06 in Ohio and $12.25 nationally, well over the federal minimum but reasonably less than a 1 person living wage. That national average of $12.25 is precisely what MIT says is needed for 2 working adults with no children to live on, suggesting that market forces do work to an extent.

We need not expect the minimum wage to support a family of 3 or 4 on a single income, as these situations are better handled with needs-based assistance programs instead.

States can set a higher minimum than the federal level. The cost of living is much higher in California than in Mississippi, so a nationwide one-size-fits-all living wage is problematic. The federal minimum should be a floor that will inevitably seem too low for Hawaiians or New Yorkers to live on, to avoid thrashing middle America economies. In Ohio, the minimum wage is $9.30 for 2022, increasing every year to keep up with inflation in accordance with the Ohio Constitution as amended by a 2006 ballot initiative.

In 1960, the minimum wage was $1.00/hour. According to the US Bureau of Labor Statistics, that’s about $9.60/hour in today’s money.

Although productivity has increased since then, that doesn’t mean people are working harder than they did 60 years ago. In many ways, technology has made labor easier, so we need not expect wages to perfectly match productive output. If a worker pulls a lever to make a widget, and the employer improves the machine to make 2 widgets per pull, they’re still doing the same amount of work and don’t necessarily deserve twice the wage.

Anti-capitalism, pro-free money

Nina Turner not only rails against the extremes of “unfettered”, “predatory”, “vulture”, “hyper” capitalism; she blames capitalism itself.

Her preferred solution is to give away unconditional money, and not just in debt forgiveness. She supports a universal basic income of $24,000 per year, exceeding even presidential candidate Andrew Yang’s Freedom Dividend plan by 2x!

Her plan is roughly equivalent to a $12/hour full time job, except no work is required. MIT says that’s enough to live on for a childless couple or a pair of roommates, all without needing to make a single productive contribution to society.

How many people would just stop working when their needs are met for free? Maybe people keep their jobs if UBI is only $2,000 per year, as with the Alaska Permanent Fund Dividend, but Turner’s proposal gives that amount every single month, 12x as much money, so there’s really no comparison there.

If Turner’s UBI was limited to American adults (258 million), it would cost $6.2 trillion every year, far more money than the US has ever brought in! Her plan is so outrageously expensive and radical that it could disrupt almost every aspect of society, potentially wreaking havoc on work ethic, productivity, standard of living, inflation, crime, corruption, political stability, etc. Assurances based on theories or small, short-term experiments hardly satisfy these concerns.

Oakland, California can go right ahead and give UBI a try. Urban counties in California, Illinois and Texas are also testing guaranteed income. They can let us know how that works out, but let’s not subject our whole nation to a super costly social experiment, please.

Turner also wants to “cancel rent”, another $512 billion yearly giveaway. This idea would lower MIT’s calculation of living wage, even further disincentivizing folks to work.

She wants to “cancel billionaires” by redistributing their wealth to everyone else, almost certainly causing many of them to move away from America and leaving the rest of us to pay for her expensive programs.

She wants us to get out of a “scarcity mindset” and would have us replace it with an “money grows on trees” mindset. Her philosophy is to always “ask for more”:

No economic system can eliminate greed or unequal outcomes. Capitalism with regulatory guardrails is the best system we’ve got. It gives us the freedom to pursue the work of our choice, although with no guarantee of success, and aligns our self-interest with incentives to contribute to society.

Blaming moderates for empowering fascism

She blames moderates and bipartisanship for hard-right extremism, but she should look at how her own extreme proposals push people away from the left and propel rightward backlash and obstructionism. For example, she supports packing 4 new liberal Justices on the Supreme Court, an escalatory move that invites even more political resentment to further divide our country.

In this tweet, she equates conservative attitudes towards health care with “Trumpism”, treating nearly all right-leaning people as no better than the guy who sent a mob to storm our Capital and continues to try to defeat American democracy. It’s a mistake to push out pro-democracy allies who happen to be conservative; folks within the Republican party who stood up to Trump, rejected his efforts to overturn the election results, or helped hold him accountable for his crimes. Although they may be in the minority within the GOP, we need them in the fight for democracy.

Finding common ground between liberals and conservatives is how we lower the temperature in this country and bring more people to a reasonable position away from far-right and far-left extremes. Turner believes progressives should be catered to before any concessions are given to center-right, never-Trump folks, but pulling further away from the center with increasingly massive far-left spending is how we get even more polarization. Maybe we should give a coalition of centrists a try instead.

She goes after bothsidesism for treating her as equally extreme as radical conservatives, but let’s look at her argument. The GOP forcing a 10-year old rape victim to keep the rapist’s pregnancy is extreme. On the other side, creating some tuition-free college options is worthwhile, but she goes so much further than that. She’s trying to give away many trillions of dollars so that no one ever has to work, ending capitalism as we know it, which really is also extreme. In this case, both are outside the range of reasonable policy.

Luckily one “side” is actually less extreme than Nina Turner, because Democratic voters and party leaders overwhelming rejected Turner’s radical policies twice, in 2021 and 2022, in favor of more moderate Shontel Brown, in their very blue Congressional district that includes Cleveland and Akron.

Previously I evaluated Turner’s rhetoric and sponsored bills and found her to be not particularly bipartisan, but not the most partisan either. However, it’s now clear that her radical spending ideas are what make her a truly extreme candidate. She shows no signs of restraint or fiscal responsibility whatsoever.

Nina Turner will be hosting an online show Unbossed starting 10/17/22, part of The Young Turks network.

There are rumors that she might run for US President in 2024.

For future consideration

• Turner was a State Senator 2008-2014 and before that a Cleveland city council member 2006-2008. What bills and initiatives did she support back then?
• Representative Shontel Brown is considered more moderate than her primary challenger Nina Turner. How exactly is Brown’s voting and rhetorical record standing up to that moderate characterization on these issues?
• Nina Turner Wants to Be the Squad’s Nick Naylor – TheBulwark

The math: number of student debt holders by income

Here’s how I calculated that 35% of student debt holding families make at least $100,000 per year and 49% make at least $75,000. Visit the Federal Reserve’s 2019 Survey of Consumer Finances and download the “Summary extract public data” CSV (SCFP2019.csv). We care about these 2 fields:

• EDN_INST – Total value of education loans held by household (column IL)
• INCOME – Total amount of income of household (column X)

Use these formulas in Excel:
=COUNTIF($IL$2:$IL$28886,">0")
The gives us the number of families that owe some student loan debt greater than zero: 5,260.
=COUNTIFS($IL$2:$IL$28886,">0", $X$2:$X$28886, ">=100000")
This tells us how many of those debtors have an income over $100k: 1,850.

Divide the latter by the former to get 35%.

Change the second formula’s last number to “75000” to get the other percentage: 2,553 families making $75k, or 49%.

Note that their survey included 5,777 families times 5 imputation replicates.