How Media Went Off the Rails Over Durham Investigation Findings

“[T]he biggest election and presidential spying scandal in the history of this great country”, is how Sean Hannity described it on Fox News. “This is far worse than Watergate”.

Late on the Friday before Valentine’s Day, Special Counsel John Durham released a court filing which stated that a “Tech Executive-1” with access to White House computer servers during the 2016 presidential campaign had “exploited” for unauthorized purposes Internet traffic data from and to the
White House and other locations. News outlets on the right immediately proclaimed this to be proof that Donald Trump had been right all along, that “They spied on my campaign”, as he said to Lesley Stahl of “60 Minutes” in an October 2020 interview. Stahl repeatedly rejected the claim, saying, “There’s no real evidence of that”. Son Eric said this week that, “Lesley Stahl owes my father an apology”, except that there was no evidence.

The Durham filing was a follow-up to an indictment in September of lawyer Michael Sussmann, who specializes in computer related cases. Sussmann had been in contact with “Tech Executive-1”, as Durham masked the individual’s name in his document, who had come upon suspicious Internet activity that Sussmann took to the FBI. The Durham allegation is that he lied to the FBI’s general counsel, James Baker, telling him that he was not representing a client when in fact his firm, Perkins-Coie, was engaged by the Hillary Clinton campaign.

Durham was appointed by former Attorney General William Barr, who had voiced strong objections to there being any investigation whatever into a presidential candidate’s campaign. Barr wanted Durham to counter his own department’s probe, first by the FBI and then handed to Special Counsel Robert Mueller, into possible Trump-Russia collusion. Durham was charged with finding out whether there were any predicates that could justify the Russia enquiry, none being the desired answer.

Durham’s investigation has now run half again longer than Mueller’s and has come up with only three indictments, one being a second lie to the FBI, the third being the doctoring of email information to assure that surveillance of former Trump campaign adviser Carter Page would be approved by the FISA court. The Sussmann indictment was for only the single count of lying yet it ran to 27 pages. Durham has been accused of using it as a vehicle to get stories out that are prejudicial to the Russia investigation but are not actionable.

Tech Executive-1 was identified by The New York Times as Rodney Joffe, working for Neustar, a company contracted to manage and monitor dedicated White House computer servers. Joffe’s group had come up with traffic between the Trump Organization and “Russian Bank-1” — Russia-based Alfa Bank which has ties to the Kremlin. The Trump server intermittently received short bursts of activity from Alfa and would then fall silent. The only other activity on the idle server was from a healthcare providing company. Joffe turned this anomalous activity over to Sussmann who took it to the FBI.

The story of the mysterious Alfa Bank transmissions surfaced in the media and was never conclusively solved, but was ultimately thought only to be advertising campaign messages from the bank which had the Trump server in its promotional address list, a surmise that would explain the healthcare outfit’s communications as well.

Sussmann would later go to “Agency-2” (assumed to be the CIA) in February 2017, where there, too, he allegedly lied by denying his association with the Clinton campaign. Joffe had given Sussmann data that identified traffic from IP addresses affiliated with a “Russian Phone Provider-1” that meant “Trump and/or his associates were using supposedly rare, Russian-made wireless phones in the vicinity of the White House and other locations”, in the words of the filing. There was no explanation of how or who, Durham or Sussmann, had concluded that “Trump and/or his associates” were the ones using the phones.

Sussmann may have run the risk of lying to both the FBI and CIA in the belief that if he admitted his connection to the Clinton campaign, both agencies would have dismissed him as a political huckster.

out of bounds

The Durham filing says it has evidence that Joffe and associates had tracked “domain name system (“DNS”) Internet traffic” to and from the Executive Office of the President of the United States (“EOP”), Trump Tower, Donald Trump’s Central Park West apartment building, and that healthcare provider. This is what the right-wing media has labeled spying.

Access to the Trump Organization and a Trump apartment building without their knowledge or consent would seem to validate that claim, although somewhat mitigated by what seems in Trump Tower only to be the single otherwise sleepy server occasionally bombarded with Alfa Bank messages. But in their yearning for Durham to finally come up with something to support their claims that the Russia investigation was a hoax, the media on the right went berserk with accusations and managed to get just about everything factually wrong with a heavy dose of deliberate distortion that became the bigger story.

First, this explanation: The Internet doesn’t deal in the names of websites. When you type in a “domain name” such as “www.letsfixthiscountry.org”, the Domain Name System (DNS) finds the website’s Internet Protocol (IP) address, its unique cluster of numbers such as 209.182.192.69 that the Internet actually uses as identifier. The original domain name is left by the wayside. The Joffe crew was engaged in “DNS lookup”. When a message came into the White House, they would backtrack the IP address to find out the source — the human-convention name of the website from which the message was sent — to check for questionable intruders. DNS data is publicly available for such analysis. It contains no text or email messages, no voicemail, just source and destination coding and logging data.

Tucker Carlson wouldn’t understand that. He told his audience that the White House crew was looking at content, “that is e-mails and presumably text messages”.

John Ratcliffe, Trump’s last director of national intelligence, must have spoiled the glee momentarily with his honesty when he said on Fox News about the high-tech company that there was no hacking. Nothing illegal took place. Marcy Wheeler, an independent journalist specializing in cyber investigative reporting at her site emptywheel.net, says “Rodney Joffe was trying to keep Obama safe from hackers. That’s all it is.”

Note “Obama”. Hannity threw truth to the winds with the following total fabrication,

“[T]he Clinton campaign paid a tech firm to infiltrate the servers at Trump Tower and then later infiltrate the servers at the Trump White House.”

Donald Trump made the same false claim, that there was spying “by operatives paid by the Hillary Clinton Campaign”. The tech firm was under a government contract, did not therefore “infiltrate”, a word that appears nowhere in the Durham filing, was not paid by the Clinton campaign, and had no access to the White House once Trump moved in. Ohio Representative Jim Jordan, ranking member of the House Oversight Committee, boosted the same falsehood that “we found out from this filing that they actually spied on a sitting president”. Nobody spied on Trump’s White House. Nor on Obama’s White House. They were there for a reason.

Wall Street Journal columnist Kimberley Strassel, whose mission has for years been to portray the 2016 Trump campaign’s contacts with Russians as hoax, said,

“Look, we had the Clinton campaign via its law firm engaging private contractors who had secret government contracts to mine data related to Internet traffic in the White House. That’s enormous. That’s a huge deal.”

That’s also a huge lie. There is no evidence of the Clinton campaign engaging Joffe and his crew, and Durham says that Sussmann was representing Tech Executive-1 as his lawyer when he “assembled and conveyed the allegations to the FBI”. Joffe was Sussmann’s “client”.

To be clear, Mr. Joffe was not exactly saintly in Durham’s telling.

“Tech Executive-1 also enlisted the assistance of researchers at a U.S.-based university who were receiving and analyzing large amounts of Internet data in connection with a pending federal government cybersecurity research contract. Tech Executive-1 tasked these researchers to mine Internet data to establish “an inference” and “narrative” tying then-candidate Trump to Russia.”

Joffe was “seeking to please certain ‘VIPs'” at the Clinton campaign, Durham tells us, but Tucker Carlson hallucinates that “Hillary Clinton had promised him a job as a top cybersecurity officer in the U.S. government”. There is no evidence of any such promise nor contact between Joffe and the Clinton campaign. Rather, he hoped to get a job once Clinton was in the White House and was out to impress the Clinton team with his helpful sleuthing.

However unseemly, opposition or “oppo” research to find unsavory data about a rival political candidate is standard practice. In the other camp, Donald Trump Jr. was welcoming a Russian lawyer who promised she had dirt on Hillary Clinton, e-mailing her “If it’s what you say, I love it”, and Papa Trump was eager for the WikiLeaks download of Hillary Clinton e-mail stolen by the Russians.

But it was unethical for Joffe to have “exploited” his White House perch, using it for “mining the EOP’s DNS traffic and other data for the purpose of gathering derogatory information about Donald Trump” as Durham wrote. At this, an aghast Tucker Carlson lost his bearings of time and place, fulminating, “Democrats were spying on Donald Trump, not just as a candidate, but as President of the United States in the White House.“. He fed his viewers the absurdity that Joffe somehow managed to stay on when Trump moved into the White House and continued to gather opposition research for Hillary Clinton months after she had lost the election.

media blackout?

Hannity began his show “with a story the media mob refuses to report…

“because they are accomplices … They have lied the entire time. They advance their propaganda almost hours a day seven days a week and they did it for over three years.”

Conservative media joined the chorus. Mollie Hemingway, editor in chief of The Federalist, concurred with…

“The failure of these other media outlets to cover it is only a reflection of their own complicity in the corruption of the regime and how they will do whatever it takes to control and keep power”.

“Counsel John Durham continues to unravel the Trump-Russia ‘collusion’ story”, was the opening sentence of an editorial in the Journal, lamely trying to inflate Durham’s work product far beyond actuality. The Journal escalated the story further than even Fox hysteria declaring that it was Joffe’s discovery of Alfa Bank pinging a Trump Tower server and Russian phones in D.C. that led to…

“secret and unjustified warrants against a former Trump campaign official [Carter Page], and later for Robert Mueller’s two-year mole hunt that turned up no evidence of collusion.”

That is not what led to the investigation. Such remarks are plentiful in the Journal‘s long campaign in its opinion pages to make the Trump-Russia contacts story vanish, as we previously covered in “The Other Big Lie the Wall Street Journal Wants You to Believe”.

Trump said in a statement,

“The press refuses to even mention the major crime that took place. This in itself is a scandal, the fact that a story so big, so powerful, and so important for the future of our nation is getting zero coverage from LameStream, is being talked about all over the world.”

All over the world it isn’t, of course, but hyper-invention about something he could not know is Trump’s brand.

In fact, liberal media was all over it, still the hot story almost a week later in successive articles as the mess the right-wing media made of it made its own news. The Times, The Washington Post, multiple hosts at CNN, MSNBC, NPR — it became universal.

It is a recurring theme of right-wing media to accuse their left-wing counterparts of hiding stories “that make their team look bad”. When making that claim, right-wing media knows that those who watch only their output will never know otherwise. They are left believing Donald Trump still saying as the week wore on “the now totally discredited Fake News Media does everything they can not to talk about it.”

As the story grew, Hillary Clinton weighed in with, “Trump & Fox are desperately spinning up a fake scandal to distract from his real ones.” Durham himself had to come forward to distance himself from “third parties or members of the media [who] have overstated, understated or otherwise misinterpreted facts.” It seems he was taken by surprise just how distorting the “journalism” practiced by media on the right can be.

is that all there is?

The filing’s purpose was actually to ask the court to be aware of the overlapping conflicts of lawyers representing the parties in the case, but Durham uses it to work in findings extraneous to Sussmann’s offense “plainly intended to politicize this case”, says his attorney. It is noteworthy that Durham goes no further than the Sussmann charge of five months ago. There is no hint of further indictments, not even of Rodney Joffe, who isn’t even named, because, while Durham wants to make public whatever skullduggery he has found, after two-and-a- half years he evidently hasn’t come up with enough to bring further cases.

Feb 22 2022 | Posted in Investigations | Read More »

Supreme Court Greenlights Yet Another Religion Case

Joe Kennedy coached high school football in Bremerton, Washington. It was his custom to engage his team in locker-room prayer before a game, and gather both teams for after-game prayers. With fans still in the stands, Kennedy kneeled on the 50-yard line and often delivered a religious speech to the players. When Coach Kennedy refused to end the ritual, school officials fired him. This was seven years ago.

Kennedy sued, saying that the school board’s actions violated his right to free speech and said that he would take the matter all the way to the Supreme Court. School officials said they were entitled to avoid a violation of constitutionally disallowed government establishment of religion. Both claims rely on the First Amendment.

In January, the Supreme Court agreed to hear the case. The Ninth Circuit Court of Appeals had ruled in favor of school officials which Justice Samuel Alito had found “troubling”. That was in 2019 when the Court denied hearing the case but issued a statement by Alito — joined by Justices Neil Gorsuch, Brett Kavanaugh, and Clarence Thomas — that the lower court’s decision “may justify review in the future”.

the religion docket

There were some 5,700 petitions to the Supreme Court in the 2020-2021 term. The justices are expected to hear from 100 to 150 appeals a year, but in recent years it has heard far fewer, averaging 77 in the decade between 2007 and 2018 and issuing opinions in only 67 during its 2020-2021 session.

Yet from this deluge of thousands, the justices have elevated to highest importance a case about praying at a high school football game. That, along with several cases in recent years, says that what we might call the Court’s religious wing — five of the conservative justices are Catholic and a sixth Protestant but educated in Catholic schools — is on a mission to give religion privileged status in American society, at a time of growing far right insistence that this be a Christian nation. That observation needs substantiation, so here’s a rundown of the many religion-themed cases the Supreme Court chose over the last decade:

¶ a town named GREECE &#0182

The First Amendment of the Constitution reads (in part) “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof”. To steer clear of government ever promoting a national religion, keeping church apart from state has been the least complicated and successful remedy.

But in a case much like Joe Kennedy’s, the Court ruled in 2014 that to begin a town council meeting with prayer in Greece, New York, was more than acceptable even though those prayers were heavily infused with Christian liturgical references. A Wall Street Journal editorial called it “a good turn for religious freedom” and even said the “disconcerting surprise is that the decision was only 5-4”.

Our country’s freedom of religion means people are free to follow their beliefs and congregate in their churches, synagogues and mosques but the Court decision said religion may be taken into the public square where people can be subjected to someone else’s religious beliefs.

Justice Alito was unperturbed by Greece town meetings at which Christian clergy had led the prayers for almost a decade because only 3% of Greece is Jewish and other non-Christian groups are fewer still. But a Supreme Court decree is universal and applies to all the town meetings across America, where the audience composition will surely be more mixed. Those in dissent ask: first, why does the exercise of government need to be wrapped in a religious benediction and a request through prayer that its activity be overseen and guided by God, and second, why should the citizens of a town have to join in prayer in order to participate in government?

¶ HOBBY LOBBY &#0182

There followed close on in June 2014 the Hobby Lobby decision, which gave a closely-held family-owned business, an Oklahoma-based chain of 600-plus stores selling craft knickknacks, a special exemption from paying for Obamacare insurance plans that provide contraceptives. Doing so, went the plaintiffs argument, offended the religious sensitivities of the corporation.

You read that correctly. The suit was brought by a coalition of companies with Hobby Lobby the largest. The corporations pay for the insurance, and therefore only the corporations could bring the complaint. That meant the religious beliefs of the families had to be transfused into the corporations so that the corporations could say their religious sensitivities had been offended. Unbelievably, the Court accommodated, which tells you how religiously zealous the conservative wing of the Court had become. Moreover, this expanded their ruling in Citizens United that corporations are “persons” and should have many of the same rights as their human counterparts.

The right of the Green family of Hobby Lobby to practice their religion was never impaired. The family is of course free not to use contraceptives and even free to proselytize abstinence to their workforce, but they wished to go beyond and impose their religious beliefs on the company’s 28,000 employees, depriving them of an insurance benefit available to everyone else under the Affordable Care Act.

CEO David Green said, “It’s our rights that are being infringed upon” and “I could live the way I do with ten stores. So why do we want 500 stores? So we can tell more people about Christ”.

¶ LITTLE SISTERS OF THE POOR &#0182

Justice Elena Kagan foretold that the Hobby Lobby ruling would bring religious objectors “out of the woodwork”. Two years later the Court heard seven petitions clustered under Zubik v. Burwel which came to be referred to as Little Sisters of the Poor, an international congregation of Roman Catholic women. Again, the complaint was that their insurance should not have to pay for contraceptives in offense to their religious beliefs.

As an accommodation after Hobby Lobby, the Obama administration arranged a carve out whereby religious organizations could simply make their objection known on a government form and provide the name of their insurer. Health and Human Services would then connect directly with the insurer to make arrangements for contraceptive coverage for the organization’s employees. The Little Sisters and their followers would be entirely removed from the process, exempted from paying for it, and unsullied by what they called the “evil acts” of preventing pregnancy.

But that — just filling in a form — was asking too much. The plaintiffs argued that simply by informing the government of their insurer, they would be “complicit” in “facilitating” their employees in obtaining contraceptives, or, as the dissent argued, exercising their own options rather than be controlled by the nuns.

¶ church schools and state &#0182

In 2017, the Court ruled that taxpayer-funded grants for playgrounds under a state program could not be denied to a Missouri school because it was run by a church. Because money is fungible, i.e., can be commingled with the other funds of an institution, and in such cases as this could be mixed with expenses for religious curricula, this has heretofore been a line not crossed. Chief Justice John Roberts wrote for the majority that, “the exclusion of Trinity Lutheran from a public benefit for which it is otherwise qualified, solely because it is a church, is odious to our Constitution all the same, and cannot stand”.

In an analogous case this past December, several justices expressed disfavor of a state program in Maine which discriminates against religious schools. The state gives vouchers to families living in rural areas that lack a public school to enable their sending their kids to public or private schools in other areas. Parents in Waterville sued because the state disallows use of the vouchers at religious schools such as the school that the town does have but which expects its teachers “to integrate Biblical principles with their teaching in every subject”, say court papers.

“All they are asking for is equal treatment,” Justice Kavanaugh said. “Treat me the same as the secular parent next door.”

¶ right of assembly &#0182

Just before midnight on Thanksgiving Eve of 2020, the Supreme Court issued a temporary injunction that nullified New York’s limits on how many could gather in public places. The restrictions were meant to control the spread of coronavirus. The Court was responding to lawsuits by religious organizations asking for emergency relief, one Catholic and one Jewish.

The Court jumped on the case considering that impairment of the right to congregate for worship constitutes an “emergency”. The Journal‘s editorial page was giddy with the Court’s opinion. The first word of its editorial was “Wow”. It continued with, “The Court is back as a sentinel protecting the free exercise of religion, even in a health emergency”.

A week after Thanksgiving, the Court signaled to a California court that it needs to follow the New York decision in a case brought by a ministry that has churches across that state.

The case was also notable for the rift that broke out between Justice Gorsuch and Chief Justice Roberts, who had sided with the liberal faction to allow governments in Nevada and California to impose crowd size limits on church services. Gorsuch was angered by bans of religious gatherings and mocked the absurdities in the list of businesses regarded as “essential” such as liquor stores, laundries, banks, or big box stores that may admit as many people as desired.

But stores are generally not places where people congregate in close proximity, whereas churches or synagogues such as those in New York City can accommodate hundreds. A news story at the time showed some 700 people of the Hasidic sect packed closely at a wedding, and with none visible in the photo wearing a mask.

¶ abortion &#0182

And finally, we will at the end of June hear the Court’s decision in the challenge to Mississippi’s law that bans abortions after fifteen weeks of pregnancy. It is widely expected the Court will overturn the precedent of constitutionally approved Roe v. Wade. If so, it is unavoidable that the legitimacy of the Court will come under fire for its being out of step with the American public, two-thirds of whom want abortions to remain legal. With the Supreme Court’s approval rating around 40%, a sizeable percentage of Americans will view the justices as simply voting their religion again.

back to the 50-yard line

Salena Zito, a CNN political analyst and a staff reporter and columnist for The Washington Examiner, is very much of the same mind as the Supreme Court. She wrote a column about Coach Joe Kennedy titled, “Does a Seattle-area coach have a prayer in his Supreme Court case?”. The answer as you can tell from above is that it’s a sure thing.

She says, “The practices of all of our faiths…and our freedom to express our religiosity are deeply rooted in our cultural DNA” and goes on to say, “The protection of religious freedoms does not benefit just people of faith; it also protects the nonbeliever.” She doesn’t explain why she believes this and she and the Court run up against trends in the U.S. A Gallup poll last April found that the count of Americans who belong to a church, synagogue, or mosque had dropped from 77% in 1999 to 47%. Pew Research in December said 29% of Americans report having no religion, a figure that was 16% in 2007 when Pew began tracking religious identity. The Supreme Court is using law to attempt to reverse that.

The Government’s Student Loan Scam and What to Do About It

Student loan debt, which continues to rise inexorably, has now reached $1.7 trillion, with clamor arising apace for President Biden to honor his campaign pledge to trim $10,000 off everyone’s account. Not enough say Elizabeth Warren and even Chuck Schumer, who want it to be $50,000. The respective costs would be $373 billion and close to $1 trillion, estimates the Brookings Institution. “I’m prepared to write off $10,000 debt, but not [$50,000] because I don’t think I have the authority to do it” by executive order, Biden said at a February 2021 town hall.

Warren and Bernie Sanders want the president to cancel all student
debt for the 43 million Americans on the hook. They go much further in advocating that that two-year community college should be free. So should four-year public college, says Sanders. Taxing the rich would pay for it, he says.

“We don’t actually have to do anything in Congress”, Warren said last September. “The President of the United States has the power to cancel student loan debt on his own.” She presumably refers to the Higher Education Act which lets the Education Secretary “enforce, pay, compromise, waive, or release any right, title, claim, lien, or demand”. The president has been waiting since April for a memo he requested from the Department of Education on what authority he has.

moral hazard

Every one of these proposals raises profound issues of inequity. Canceling debt makes fools of those who struggled for years to pay all of their debt, or worked their way through college to avoid debt when they could have had a free ride off the government, or joined the armed forces at possible risk of life in order to take advantage of the educational opportunities military service afforded them.

The Washington Examiner calls it a “tremendous wealth transfer” to the college educated while doing nothing for the tens of millions of workers who forsook college, apprehensive about the debt burden, but would now through their taxes pay for the magnanimous gift the government would be giving to those who enjoyed the privilege of a college education.

In a letter to The Wall Street Journal, Patrick Demetruk of Stephenville, Texas, makes this resounding point:

“Maybe the colleges with the multimillion-dollar endowment funds that are benefiting from these overpriced educations should be on the hook for the forgiveness of the debt and not the U.S. taxpayer.”

Loan forgiveness would perversely benefit all the more those who borrowed the most as for advanced degrees — business, medical, law, etc. — in order to gain higher paying jobs. (Brookings calculated that those earning over $74,000 a year post-college owe almost 60% of the nation’s $1.7 trillion.)

Wiping out college debt would also reward those who took on far more debt than they could ever repay by their choice of a low-paying occupation, such as a 29-year-old in a Journal article with a fine arts degree, $300,000 of debt, working as a Hollywood assistant making from $30,000 to $50,000 a year in temporary jobs as a film assistant and in video production, or University of Southern California students loading up on $115,000 of debt for masters degrees in social work.

a serious drag on the economy.

Nevertheless, action must be taken, and we wonder why we’ve seen no one come up with the just and equitable solution we propose here. Stay with us.

The debt load is weighing down one generation going on two. With 7.65% in payroll taxes already taken from their paychecks, having another $400 or so drained from their bank accounts every month is crippling people well into their adulthood (the median debtor is 34 years old). Young people forestall marriage, postpone having children, can afford only used cars, can’t get a mortgage to buy a house. Student debt is a serious drag on the economy.

Before getting to a very different approach, a mention that certain classes of borrowers have seen erasure of debt. Some $5.8 billion was wiped out for the 323,000 borrowers who are totally and permanently disabled. Close to $3 billion is available to refund students who were misled by false marketing claims of, most typically, for profit colleges, or whose colleges closed while students were enrolled, such as the 115,000 who attended ITT Technical Institute.

There are then two types of programs that attempt to mitigate the debt burden:

Public Service Loan Forgiveness: Those who devote themselves to public service — federal, state and municipal workers; teachers; charity workers, etc. — can have their remaining debt forgiven after 10 years. But qualifying is difficult. Only full-time jobs count; one must have the correct type of loan; show a perfect record of 120 on-time payments. That relies on perfection at the payment servicing companies as well, where shoddy bookkeeping has proven to be a nightmare for borrowers to straighten out. Moreover, Trump’s Education Department was helmed by Betsy DeVos, from one of the nation’s wealthiest families, who thought all debt reduction was a “free money” giveaway. Under her, 98% of public service applications were rejected.

Income-Based Repayment Plan: Loan repayment is tied to income, 15% for older sign-ons to the program, lowered to 10% by the Obama administration, with any unpaid balance canceled after 25 years, or 20 years for later applicants during Obama.

But under both these plans, benefits happen at the back end. Neither helps borrowers today. Unsurprisingly, millions would be in stages of deferred payment or outright default were it not for the pandemic, which caused President Trump in March of 2020 to put loan payments on hold and set the interest rate at zero, a moratorium continued by Biden until May. But if we look back to pre-pandemic 2019, about 10% of the federal student-loan portfolio was 30 days or more past due, and another 20% was in deferment, called “forbearance”, where the borrower has asked for a pause in payments (but with interest unceasingly piling up).

The principal reason former students have difficulty paying is that the college costs they signed up for have been allowed to rise into the stratosphere. In the almost no questions asked loans for everyone policy of the federal government, universities saw the opportunity to raise tuition to predatory levels to cash in on the bonanza.
The average tuition fee at four-year public universities in America after adjusting for inflation has roughly tripled over the past three decades, according to The Economist.

The obvious problem

Strange that no one brings up interest charges. America wants a well-educated workforce, whether in liberal arts, engineering, law, medicine, trade skills — any and all. Education is virtually the national mantra, universally cited as the path upward, the route to a better life, and essential to U.S. competitiveness in a challenging world. It’s why there is a government student loan program. So why does the government charge interest on student loans?

The answer is that it makes money for the government, which makes government a confidence artist, peddling the virtues of education so that it can charge. “Congress has a hard time changing programs that make money for the government”, said a Journal article. America’s students are treated as a profit center, and that is obscene.

Students who are still dependents of their parents can borrow up to $31,000; those no longer dependents can sign on for up to $57,500. But in the 1990’s, Congress went further with its PLUS program that let parents borrow amounts limited only by income and credit standing, and for the full cost of education (room and board, books, etc.), not just tuition. A decade later, Congress added a PLUS program for graduate students, again with no dollar limit. Enrollees in both pay higher interest rates than undergraduate borrowers, and PLUS signers are even charged a 4.25% origination fee!

That they make money is a major reason Congress created the PLUS programs, which quickly became the fastest-growing in the student loan mix, with about 3.6 million parents and 1.5 million grad students owing about 12% of the $1.7 trillion on the books but accounting for 26% of new loans.

And look at the rates undergraduates have been charged (table), rising to 3.73% for this year.
Among all borrowers, 5.8% is the average student loan interest rate and we see in the table that rates have run to over 4% in years like the present when the federal funds rate was virtually 0%. Graduate students borrowing directly will be charged 5.28% this year. PLUS borrowers, parents or graduate students, face a 6.28% rate, up from 5.3%. This is grift, exploitation of the young by Congress and the federal government.

The answer: erase interest charges

If we take as a premise that major debt relief action needs to be taken — acknowledging, there’s the opposing argument that people should be held responsible for the debt they have taken on — reversing interest would be the equitable course. What we mean by reversing interest is this:

As an accounting entry, apply the entire payment history of each borrower to principal — the face value of the loan — as if interest charges never existed, and cancel interest on the balance yet to be paid. With interest charges removed as an inducement to repay promptly, convert all loan repayment to percentage of income until paid in full. End back-end loan forgiveness.

This action does away with the unfairness of outright canceling of all future obligations proposed by progressives, unfair to those who have dutifully been paying for years. Spread on both past and future, wiping out interest equitably benefits all. Other than the 10-year debt elimination meant to encourage people to choose low-paying public service careers, loan forgiveness was essentially an acknowledgement that the student loan program is too onerous, but with the interest burden eradicated, and all plans shifted to manageable percentages of income, forgiveness loses its justification.

As to cost of this proposition, the loan program faces steep costs in any event. In 2020 the Education Department estimated that $435 billion will eventually be written off owing to the forgiveness programs and those who have no prospects for repaying. That figure has only grown with the accelerating PLUS programs’ borrowers who run up much higher debt. Given that eventuality, it makes sense to move that write-off cost to now by canceling its principal cause — interest — to lighten the load now. Twenty years after entering school, half of student borrowers still owe $20,000, says Education Status Initiative.

Despite the deluge of data on the Internet, the cost is difficult to calculate because none of that data considers interest elimination, but given the typical undergraduate borrowed amount of $30,000, the standard repayment plan of 10 years, and the average interest rate of 5.8% for all loans currently outstanding, the total interest forfeited for 43 million in hock to the government would be $413 billion. In fact, more than $30,000 is borrowed by graduate students and on average it takes 21 years for borrowers to pay off their loans. They had to opt for longer than 10 year terms or had difficulty paying, with piled-on interest putting them further behind. So the “cost” would be considerably higher.

But no matter because it is only a bookkeeping entry. No dollars flow. The only exception would be refunds to those whose total payments have exceed the principal of their loan. Killing interest reduces future government revenue. We argue it should, given the cupidity of profiting from students.