President Joe Biden signaled willingness this week to force taxpayers to pay off student loans once the pandemic-era pause on payments expires on Aug. 31 after more than two years and multiple extensions. In January 2020, one working-class father went viral for reminding voters why debt forgiveness was unfair.
At a Monday meeting with the Congressional Hispanic Caucus, Biden reportedly told lawmakers an executive order to unilaterally sign off on a massive private debt bailout is potentially in the works, according to members in attendance who spoke to the Washington Post.
White House Press Secretary Jen Psaki confirmed the president was considering forcing taxpayers to pay off student loan debt, telling reporters Monday Biden “would make a decision about any cancellation of student debt before the conclusion of the pause on student loans.”
Questions about the constitutionality of this idea aside, the idea of a broad bailout questions who the modern Democratic Party has come to serve. Spoiler: it’s not the low-income minority families they claim.
According to a new study from the left-leaning Brookings Institute out in January, University of Utah economist Adam Looney revealed “student debt is concentrated among high-wealth households” where “across-the-board forgiveness is therefore a costly and ineffective way to reduce economic gaps by race or socioeconomic status.”
With more than $1.7 trillion in outstanding education debt, any major form of federal cancellation is nothing short of a giveaway to the upper classes that can only worsen the underlying problem exacerbated by government subsidies in the first place.
While running for the Democratic presidential nomination in Iowa, a snarky Massachusetts Sen. Elizabeth Warren, who made student debt bailouts a hallmark of her campaign, appeared shocked when asked by a voter whether her plans would offer compensation for the responsible families who worked overtime to pay off their own student loans.
“My daughter is getting out of school. I’ve saved all my money. She doesn’t have any student loans. Am I going to get my money back?” he asked.
“Of course not,” Warren said.
“So you’re going to pay for people who didn’t save any money and those of us who did the right thing get screwed,” he said. “My buddy had fun, bought a car, went on vacations. I saved my money. He made more than I did. But I worked a double shift, worked extra. My daughter worked since she was 10. So, you’re laughing… “We did the right thing and we get screwed.”
How much Biden wants to put on taxpayers’ books remains unclear. While more restrained during the primaries compared to his opponents’ plans, the president previously called for congressional legislation to “immediately” wipe out $10,000 off every person’s student loans as part of a pandemic spending bill. On Wednesday, Psaki said there were no plans to offer retroactive payments for those who already paid off their own debt.
“I don’t have anything to preview on that front,” Psaki told RealClearPolitics’ Philip Wegmann.
If Democrats wanted to reduce the debt burden, they’d tackle inflationary tuition rates fed by generous government subsidies incentivizing the price hikes. At the end of the day, student debt forgiveness is just another subsidy, an expensive one at that, paid for by those who already paid their own tuition, or skipped university altogether. That’s the vast majority of Americans.
