Bernie Sanders Tax Model

“Seven in 10 seniors (69%) who graduated from public and nonprofit colleges in 2014 had student loan debt, with an average of $28,950 per borrower. (Student Debt and the Class of 2014).” Presidential hopeful Bernie Sanders has a very audacious idea that could possibly fix this growing problem. Sander’s unique charisma, reminiscent of the sixties, is reinvigorating young voters who are very fond of his plan to pay collage tuition. His idea deals with economic concepts such as, the government’s fiscal policy and Keynesian economics ideology that plays a big role in the policies of democrats. Sanders idea sounds almost too good to be true; that is because it is. Bob Davis, senior editor at the Wall Street Journal, and Josh Mitchell, staff reporter
Bernie Sanders believes a tax on Wall Street trading would provide plenty of money to pay for state run universities, allowing affordable higher education for all American citizens. The tax would be called the financial transactions tax (FTT) and would consist of stock trades taxed at .05%, Bonds at .01% and lastly financial derivatives at .005%. In the article by Bob Davis, Can Bernie Sanders’s Tax Plan Fund Free Collage, he writes, “Figuring out how both sides come up with their estimates is crucial to understanding whether Sen. Sanders is economically deluded or a visionary. Mr. Sanders’s economic advisers and the TPC have been fighting over these estimates since at least last fall, and have fired recent salvos (Davis 1). ” Whether or not this plan works relies heavily on how the revenue is estimated. Davis mentions Robert Pollin, an economist at the University of Amherst, who estimates 3 trillion in revenue towards the program in the next ten years that would be more than enough for Sanders 750
Sanders idea of providing aid to people who cant afford higher education isn’t exactly benefiting the poor or lower class as much as he intended. In the article Mitchell references Brookings contributor Mathew Chingos ideas and he says, “Mr. Chingos’s explanation is simple. The Sanders plan would relieve students of paying any tuition at public colleges and universities, both at more-selective schools that tend to be more expensive, and less-selective schools that tend to be cheaper’… ‘At public four-year colleges, dependent students from higher-income families tend to attend more expensive institutions,’ he writes. As a result, they would get most of the aid if college tuition were free (Mitchell 1).” Given these circumstances the wealthy are the ones benefiting most from the free tuition not the lower class or the people sanders intended to help. Michel touches on this when he writes, “The benefits of the Sanders plan, in dollar terms, rise as household income rises. Among all public institutions, dependent students in the bottom quarter of earners would get, on average, $3,678 in tuition relief. Students in the top quarter would get $5,308 (1).” The problem that typically arises when a tax plan generalizes like this and doesn’t target a specific group the wealthy typically reaps the benefits. Chingos says, “ ‘There are