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Former Vice President Joe Biden declared Monday that, as president, he would move to ensure that Americans with student loans have some of their debt “immediately” — by magic, apparently — wiped away.
Outstanding student loan debt currently stands at more than $1.5 trillion.
What are the details?
Biden was asked by a reporter on Monday whether student loan forgiveness is part of his economic agenda. Biden responded affirmatively, no doubt pleasing the Democratic Party’s far-left members.
“It’s holding people up,” Biden said of student loan debt, the New York Times reported. “They’re in real trouble. They’re having to make choices between paying their student loans and paying their rent, those kinds of decisions. It should be done immediately.”
Biden voiced support for a proposal from House Democrats that would forgive $10,000 of student loan debt per borrower.
“Immediate $10,000 forgiveness of student loans, helping people up there in real trouble,” Biden said, Fox News reported.
House Democrats originally proposed forgiving $10,000 of student loan debt per borrower as part of their proposal for a second COVID-19 relief bill, which had a price tag of $3 trillion, making it the most expensive bill in history. The legislation was never considered in the Republican-controlled Senate because of its cost.
Democrats later scaled back their bill when the Congressional Budget Office estimated that it would cost between $200 billion and $300 billion to forgive the amount of debt they were proposing.
Is forgiving debt a good idea?
Biden is forging a middle ground by supporting the forgiveness of just $10,000.
For many Americans, especially those who worked their way through college to graduate without debt or those who worked diligently after graduation to pay off their debt, any forgiveness is too much. But for progressive Democrats — and many young people, in fact — Biden would not be going far enough.
On Tuesday, Rep. Alexandria Ocasio-Cortez (D-N.Y.), one of the most influential Democrats in the country, reiterated her demand for debt cancelation.
She said, “‘Things were bad for me, so they should stay bad for everyone else’ is not a good argument against debt cancellation – student, medical, or otherwise.”
Contrary to what progressives like Ocasio-Cortez claim, “canceling debt” is not something that actually exists. Lawmakers could remove a borrower’s liability for re-paying the debt, but the debt will be shifted onto someone.
In the case of federal student loans, the burden would be further shifted onto taxpayers.
Canceling student loan debt, then, rewards Americans who choose to go into debt for a degree — and agree to re-pay their debt — while penalizing Americans who did not choose debt, one critic told Ocasio-Cortez. Magically wiping away debt absolves all responsibility for mostly unwise decisions, removing the life-learning element included in accepting a mountain of debt for a college degree with a poor return on investment.