As American Jews, at what point do we stop to assess the collateral damage that the coalescence of crippling student loan debt and the advancement of AI in all facets of the economy will have on America’s working and middle class? Student Loan Debt, AI and the Extinction of the American Middle Class, jewishjournal.com, Lisa Ansell As millions of student loan borrowers are forced back to repayment on September 1, the Biden Administration will preside over the largest wave of mass defaults in the nation’s history, which will reverberate into every sector of the economy from housing to travel to retail. As American Jews, at what point do we stop to assess the collateral damage that the coalescence of crippling student loan debt and the
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Angry Bear considers the following as important: Alan Collinge, Education, Hot Topics, Lisa Ansell, politics, Student Loan Justice Org, US EConomics
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As American Jews, at what point do we stop to assess the collateral damage that the coalescence of crippling student loan debt and the advancement of AI in all facets of the economy will have on America’s working and middle class?
Student Loan Debt, AI and the Extinction of the American Middle Class, jewishjournal.com, Lisa Ansell
As millions of student loan borrowers are forced back to repayment on September 1, the Biden Administration will preside over the largest wave of mass defaults in the nation’s history, which will reverberate into every sector of the economy from housing to travel to retail.
As American Jews, at what point do we stop to assess the collateral damage that the coalescence of crippling student loan debt and the advancement of AI in all facets of the economy will have on America’s working and middle class?
According to Goldman Sachs economists, as many as 300 million full-time jobs around the world could be automated in some way by the newest wave of artificial intelligence that has spawned platforms like ChatGPT, rendering the worker obsolete in a world where they are no longer relevant yet paralyzed by debt. Moreover, these economists predict that 18% of global work can be computerized, with the effects felt the deepest in more advanced economies. Further, as AI goes multimodal with the ability to draw on audio, pictoral and alphanumeric data to execute processes, even the current generation of ChatGPT could soon be made obsolete. With the return to repayment of the most burdensome and least protected type of debt experienced by now four generations, how will 45 million middle- and working-class Americans navigate the advent of automation while simultaneously being crushed by insurmountable student loan debt?
Consider this: Nearly 60% of all borrowers weren’t making payments on their loans even before the pandemic.
Since the Reagan administration first delivered deep cuts to higher education funding with the belief that the government shouldn’t be “funding intellectual curiosity,” the American middle class has shrunk to the point that it is otherworldly to recall that during the 1970s, a middle-class family could own a home, own a car, take a yearly vacation, and send their children to college on one salary. Further, as college tuition has soared far past the rate of inflation, 45 million Americans spanning four generations of all demographics are trapped in a vicious 2T student debt trap, uniquely stripped of the constitutional right of bankruptcy present in every other type of consumer debt. The newly passed debt ceiling deal has codified the end of the student loan payment pause, which has been a lifeline to millions of middle- and working-class Americans as they grapple with the additional $500 a month caused by inflation. Tack on student loan debt plagued by compounded interest and negative amortization, and the average borrower will now have to cover the costs of inflation plus an average of $400-$500 a month in student loan debt resulting in an extra $1000 a month that will never materialize. Moreover, according to the Department of Education, in 2019 nearly 60% of all borrowers weren’t making payments on their loans with the staggering statistic of a borrower defaulting every 26 seconds and that was before the pandemic.
The newly passed debt ceiling deal has codified the end of the student loan payment pause, which has been a lifeline to millions of middle- and working-class Americans as they grapple with the additional $500 a month caused by inflation.
Once this lending system is turned back on, that number will easily reach 80%, collapsing any purchasing power of the middle and working class. In essence, due to the false promises of trickle-down economics where the money never actually gets to the workers who keep the corporations profitable, the fault lines of what defines a middle-class life in America today will continue to be eroded by a lifetime of indentured servitude devoid of any consumer protections and with technology that will render what is left of the hollowed out middle class essentially extinct.
As the daughter of a legendary English teacher, I am reminded of the character Willy Loman, the protagonist of Arthur Miller’s “Death of a Salesman,” in which Willy, a career salesman, symbolizes the ordinary man in American society. His slow demise acts as a representation of the ordinary person leading a fruitless life in a flourishing nation that has left him behind. Willy ends up committing suicide after realizing that there is no place for him in a rapidly changing world where his skills are outdated and devalued. As a committed Jew, I am reminded of the timeless wisdom of Rabbi Joseph B. Soloveitchik Z”L as he so keenly observed that the “feeling of isolation is very destructive. It has the power to crush man’s body and spirit, silence his spiritual powers, and stop up the wellsprings of his inner creativity.”
Ironically, the tragic words of Willy Loman ring just as true today as they did in 1949: “You can’t eat the orange and throw the peel away—a man is not a piece of fruit.”
Lisa Ansell is Associate Director of the USC Casden Institute.