What If We Forgave Auto Loan Debt Instead of Student Loan Debt?
The Wall Street Journal (paywall) recently reported on growing auto loan terms of seven years or more and shockingly high auto monthly payment amounts that are unaffordable for middle-class Americans.
These stories follow reporting by NPR from last fall on how seven-year auto loans are straining Americans’ finances even while the economy has record-low unemployment.
And as early as 2016, Last Week Tonight with John Oliver was sounding the alarm on buy-here, pay-here dealers that cycle credit-challenged borrowers in and out of unreliable used cars that they resell to people again and again following repossession.
These stories (only a fraction of a few) paint a picture of an industry rife with fraud, consumer deception, and practices generally reminiscent of the type that fueled irresponsible lending during the housing bubble.
Unacknowledged in these stories is the increasingly perplexing disconnect that exists between the growing calls for student loan forgiveness and the lives of most Americans who own a car and are also underwater or deeply in debt.
And while the student loan debt total is impressive ($1.6 trillion), it is only slightly more than the amount of total auto loan debt ($1.3 trillion as of June 2019). In fact, the size of…
