Senator Sanders Misleads his Twitter Audience Yet Again
[dropcap size=big]S[/dropcap]ocialist presidential candidate Bernie Sanders drew scorn from the right after a post he made on Twitter went viral. The post, which criticized the rates of home refinances versus student loans, was mocked by anyone and everyone with a clear understanding of banking, economics, and politics. Critics of Sanders, both conservative and libertarian, have attacked Sanders on his ignorance of basic economics; but rarely does he openly admit he does not understand how market mechanisms work.
You have families out there paying 6, 8, 10 percent on student debt but you can refinance your homes at 3 percent. What sense is that?
— Bernie Sanders (@SenSanders) December 26, 2015
What Bernie doesn’t understand, or chooses to ignore, is that homes and property are less of a risk than a college degree. Say you don’t make payments on your home; the bank can seize your property and get something back from you. It could wreck your credit and you could get sued for the money. The bank can also look at your credit score and find out whether or not you’re worth dealing with. But with student loans, lenders don’t have these advantages. They can’t seize your degree. They can’t take your education from you. You can’t file for bankruptcy on it, and they have to loan you your money without knowing your credit score. It’s an enormous risk to loan someone money for a degree in “Feminist Dance Theory.” This is part of the economics Bernie doesn’t grasp.
Fortunately, if you’ve lost faith in humanity, don’t give up yet. There are people out there doing God’s work and taking it to his economically illiterate statements.
From our very own Elias Atienza: