With six months to the November election, Democrats are distressed about President Biden’s plunging poll numbers among young voters in particular.
A Quinnipiac poll in April found that while only 33% of all voters approved of Biden’s job performance, it was even worse among voters aged 18 to 34, an anemic 21% approval.
Young people have soured on Biden, but Democrats are hoping to buy themselves political relief before the midterm elections. Democrats plan to bribe them to the polls.
This is the context for a renewed push to forgive student loan debt. Millions of borrowers can’t or won’t repay their loans so Biden says he may cancel their debt.
The taxpayers who repaid their loans or didn’t go to college will pay instead.
The federal government has postponed repayments of student loans seven times since the start of the pandemic; no one has been required to pay back a student loan since March 13, 2020. Interest rates on those loans during this period dropped to zero, and collections on defaulted loans stopped.
This reprieve has cost the government $100 billion and counting – money not appropriated by Congress. Now Democrats want Biden to compound the damage to taxpayers and the Constitution by writing off loans by presidential fiat.
Republicans have accused Democrats of using debt relief as a crassly irresponsible play for votes.
“Desperate polls call for desperate measures: Dems consider forgiving trillions in student loans,” tweeted Sen. Mitt Romney (R-Utah). “Other bribe suggestions: Forgive auto loans? Forgive credit card debt? Forgive mortgages?”
About 40 million people owe around $1.6 trillion in federal student debt. Most borrowers don’t need relief, but a lot of it is concentrated among a relatively small share of borrowers who attended graduate school or were either in medicine or law. These are where the large balances exist.
Elizabeth Warren, Chuck Schumer and other far-left progressive Democrats urge Biden to cancel $50,000 in student debt for each student loan borrower.
Biden campaigned in 2020 on forgiving $10,000 in student debt. He’s indicated a willingness to compromise in between.
The fiscal difference between these two proposals is significant. Forgiving up to $50,000 of debt would cost an estimated $950 billion. That’s more than the U.S. spends annually on national defense.
The $10,000 debt forgiveness while fiscally more modest still has an estimated cost of $321 billion, larger than any domestic spending bill previous to COVID. It would be done without Congress appropriating the money for it.
There’s also a fairness issue. About 60% of Americans have some college education. That also means 40% do not, including plumbers, truck drivers and construction workers. Are we really going to tax them to forgive the debt held by doctors, lawyers, Ph.D.s and those with master’s degrees?
And what about people who have neither taken on debt or have paid off their debt?
If Biden goes ahead with his plan to forgive $10,000 of student debt he would be transferring $321 billion directly to a small number of beneficiaries, enriching the already rich.
It’s a political pander benefiting a young segment of the electorate to ensure they vote in November. It comes at the expense of American taxpayers.
Biden proposes to wipe-out student debt unilaterally – without congressional action. He said originally that he didn’t have legal authority to cancel student debt on a large scale.
“I don’t think I have the authority to do it by signing with a pen,” Biden said last year.
A legal analysis by Charlie Rose, the Obama administration’s top Education Department lawyer, predicts Biden’s scheme would be overruled in court.
Even Nancy Pelosi is clear Biden doesn’t have the constitutional authority for broad debt forgiveness. That requires an act of Congress, she said.
Biden’s student debt cancellation appears more political ploy than plan – an election year gimmick.
Email Jim Hartman at firstname.lastname@example.org