The shame of the situation is that proponents of a bill to cancel or forgive outstanding student loans do not understand the process. Or worse, they know and are comfortable with someone else paying their debt. Either situation is disappointing and indicative of a generation weaned on entitlements.
The Squad is pushing for total forgiveness and has made it known that anything less by Joe Biden will violate his campaign promise. Those of us on the Right want zero forgiveness, and any plan by Biden will further fuel historical inflation.
There are around 45 million student borrowers in the U.S. holding about $1.6 trillion in outstanding federal student loan debt. They are waiting anxiously to see what level of relief Biden will sign off on. Let’s look at the three options the President is mulling.
- No Relief at all. Biden has already forgiven $17 Billion in student loans through COVID actions since he took office in 2021. This option will anger Democrats who need something they can use for the upcoming mid-terms.
- $50K in relief by Executive Order. This plan would wipe out all debt for 36 million borrowers. This is the plan being supported by Chuck Schumer and Elizabeth Warren.
- Two White House officials told The Washington Post on May 27 that Biden’s plan would see debt forgiveness of $10,000 per student borrower limited to individuals earning less than $150,000 in the previous year or married couples filing jointly who earned less than $300,000.
In a separate action involving Student Loan Forgiveness, the U.S. Department of Education announced Wednesday that it would forgive all remaining debt for over half a million borrowers who attended and were defrauded by any campus owned or operated by Corinthian Colleges, the for-profit education chain that closed in 2015.
This is the department’s most significant single student loan discharge ever: An estimated 560,000 borrowers will automatically have their loans totaling an estimated $5.8 billion canceled. They don’t have to apply for a borrower defense discharge; the department says it will discharge the loans without “any additional action on their part.”
Other student loan actions taken by the Biden administration include:
- Discharging $5.8 billion in student loan debt for more than 300,000 borrowers who have a “total and permanent disability.”
- Discharging $55.6 million in student loan debt for those who attended troubled schools like Westwood College and the Court Reporting Institute.
- Discharging $238 million in student loan debt for 28,000 borrowers who attended Marinello Schools of Beauty.
- Discharging $415 million in student loan debt for 16,000 borrowers defrauded DeVry University, Westwood College, ITT Technical Institute, and other institutions.
These loans do not simply disappear. The burden shifts to the taxpayer. The students are off the hook at the expense of hardworking Americans. It is an unfair shift or transfer of wealth.
Biden will not do nothing. He has to make an effort to satisfy the Left and Radical Left. The real question is this just a first step to free college education for all Americans? What relief do those who paid back their loans in full receive? What does this forgiveness mean to new students applying for student loans? Nothing beyond immediate relief from existing debt is being discussed. I understand that this act by the Biden administration will add to the inflation number. The burden of the forgiven debt and higher prices for goods and services will hurt the average American. What words of comfort will Biden bestow on them? Stay tuned, and we can all wait for the correction from the White House staff.
