The United States government will find out soon enough what "moral hazard” means.

Clearly it does not know already, or President Joe Biden would not have announced recently that his administration would forgive U.S. student debt worth around 1.6% of gross domestic product.

It’s natural to ask, as critics have, whether the new policy is fair. Should regular taxpayers subsidize those who went to college — who, after all, have above average human capital and earning potential? Should those who have already paid back their loans subsidize those who have not?