Criminal, but inevitable.
The Democrats have a sizable demographic of upper-class people with MAs and PhDs who account for both a disproportionate amount of student loan debt and primary activism. Call it the Elizabeth Warren demographic. Those people want a very big government handout that they’re calling student loan forgiveness.
Even Biden’s people realize that just having the government cover $1.75 trillion to its voter base might be a bit much, so they’re starting with $230 billion.
White House officials are currently planning to cancel $10,000 in student debt per borrower, after months of internal deliberations over how to structure loan forgiveness for tens of millions of Americans, three people with knowledge of the matter said.
President Biden had hoped to make the announcement as soon as this weekend at the University of Delaware commencement, the people said, but that timing has changed after the massacre Tuesday in Texas.
The White House’s latest plans called for limiting debt forgiveness to Americans who earned less than $150,000 in the previous year, or less than $300,000 for married couples filing jointly, two of the people said. It was unclear whether the administration will simultaneously require interest and payments to resume at the end of August, when the current pause is scheduled to lapse.
Quite a high-class problem.
A $10,000 check to the upper class while using a means test of $300,000 in a time when people are struggling to gas up their cars and buy food is really something.
Pouring in $230 billion into an economy that already suffers from out-of-control inflation means throwing oil on the fire. But Biden has clearly decided that the majority of Americans hate him, so all he can do is service his base. That means racial dog whistles for the lower part of it and subsidies for the upper portion of it.
Wiping out $10,000 of debt per borrower could cost roughly $230 billion, according to estimates by the Committee for a Responsible Federal Budget, a nonpartisan think tank. However, restarting payments for borrowers, which have been on hold since March 2020, would bring additional money into federal coffers. The think tank said in March that pausing payments had cost the federal government $100 billion and would run around $50 billion per year
This isn’t forgiveness, it’s stealing from social security, which is heading toward running out of money, to subsidize Elizabeth Warren’s base. It’s a giant middle finger to most of the country. Especially the working class.
On Feb 1, the New York Times ran an article warning that the national debt had topped $30 trillion for the first time, leaving us in so much debt that “the government would need to spend an amount larger than America’s entire annual economy in order to pay it off.
The Social Security Trust Fund, sold to a generation that survived the Depression and witnessed the early stages of the disintegration of the family as a hedge against growing old in poverty, became just another flow of tax revenues that can’t and won’t be paid back once the unfunded bill fully comes due.
The doomsday clock for the Trust Fund moved up one year. The news that Old-Age and Survivors Insurance will now run out in 12 years was largely ignored in 2021. It’ll go on being ignored until the mandatory 20% cuts start kicking in. And then it’ll get even worse.
Medicaid’s hospital insurance will be out much sooner by 2026. That’s only four years away.
But sure, kill seniors and then write a $10K check to the grad students who took out loans they don’t want to pay back.