Cancelling student debt without controlling college costs isn’t a plan. It’s a shameful vote getting scheme for the short-term with damaging long-term consequences for everyone. It also leaves out the cure!
Yet that is what Joe Biden is planning to do at the insistence of his party members.
The people who benefit are the elite.
GOVERNOR DESANTIS NAILS IT!
Governor DeSantis explained how grotesque it is to make the working person pay off elite debt:
.@GovRonDeSantis full response to a question about student loan debt today: https://t.co/k6MsUKP6b2 pic.twitter.com/3Hvq4OFoPG
— Christina Pushaw 🐊 🇺🇸 (@ChristinaPushaw) April 29, 2022
THE PEOPLE WHO BENEFIT
A recent Federal Reserve Survey of Consumer Finances found that only 22% of families had student loan debt and that “student debt has consistently been disproportionately held by higher-income families.” Therefore, this is a giveaway to the financially successful students and families paid for by middle-class workers, millions of whom didn’t go to costly, elite universities.
Once student loans move to “free college” for everyone, university tuitions, which are already soaring at two to three times the inflation rate, would race further ahead of all other consumer prices.
The problem is that colleges and universities have become inefficient money wasters with no accountability. There is no oversight and bad teachers stay in their jobs with fat salaries. Tenured teachers teach one to three classes in a year. Costly extracurricular programs -having nothing to do with college-level work – exist and multiply unnecessarily.
IT’S INFLATIONARY
The Committee for a Responsible Federal Budget analyzed the cost of cancelling student loan. They concluded that the plan is “inflationary” and bad policy.
From the press release:
According to press reports, President Biden is seriously considering cancelling a large swath of student debt – perhaps more than the $10,000 per borrower he originally proposed during the campaign.
We previously estimated that cancellation of $10,000 per borrower would cost roughly $250 billion, cancellation of $50,000 per borrower of debt would cost about $950 billion, and full cancellation would cost roughly $1.6 trillion.
This cancellation would be on top of the current repayment pause and other targeted cancellation policies, which will have already cost the federal government at least $150 billion.
It’s a talking point and it’s ideology.
“Student debt cancellation may be an extremely appealing political talking point, but it is not good policy,” Maya MacGuineas, president of the committee, said. “It is costly, inflationary, poorly targeted, and fails to address the root problems in our higher education financing system.”
“Full debt cancellation would be a massive hand-out to rich doctors and lawyers, would worsen our inflation crisis, and would cost almost as much as the entire 2017 tax cuts,” MacGuineas outlined. “Even partial debt cancellation would be costly, regressive, and inflationary. Forgiving $10,000 per person of debt would cost as much as universal pre-K or a full extension of the expanded ACA [Affordable Care Act] subsidies.”
Elite universities, and many others, have huge endowments. Let them pay off the student debts. They should also stop offering useless and expensive degree programs like gender studies, sociology, African-American studies, puppetry, and more. Also, they should stop paying exorbitant salaries to people who hardly work or just aren’t worth it.
Democrats keep screaming for these freebies – Dems love freebies that aren’t free – but they offer no solutions to keep the problem from reoccurring.
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