What consequences are there to “just forgiving” federal student loans?

Question

For context, I’m really referring to central banks. What would the consequences be if the central banks just decided to forgive entities that issue student loans, like FAFSA? I’m asking on a global scale and an individual household scale.

Thank you!

In: 13

Answer 1

It would set a precedent that government can simply arbitrarily give money to whatever group they want to. They do this already, but it would ne more blatant than usual.