Republicans Enraged after Biden ‘Forgives’ Billions of Dollars of Student Debt

Republicans Enraged after Biden ‘Forgives’ Billions of Dollars of Student Debt: ‘Slap in The Face’ to ‘Hard-Working Americans’
Diana Glebova
Wed, August 24, 2022 at 11:02 AM

Republican lawmakers blasted Joe Biden’s Wednesday executive order to “forgive” billions of dollars of federal student-loan debt, arguing that the “scheme” benefits the upper class, and transfers the cost to taxpayers, the majority of whom did not attend college.

Biden’s order “cancels” $10,000 in federal student debt for individuals making under $125,000 annually and households making under $250,000 annually, as well as relieving $20,000 in debt for Pell grant recipients.

Republican Senate Minority Leader Mitch McConnell called Biden’s decision “a slap in the face to working Americans.”

“Democrats’ student loan socialism is a slap in the face to working Americans who sacrificed to pay their debt or made different career choices to avoid debt. A wildly unfair redistribution of wealth toward higher-earning people,” the Kentucky senator said.

Republican Texas Senator Ted Cruz said it was just a “Hail Mary” before the midterms, calling it “insane and illegal” and that “the middle class will be stuck with the bill.”

Republican Nebraska Senator Ben Sasse said Biden’s order “baptizes a broken system,” and advantages college graduates over their blue collar countrymen.

“The President can spin it however he wants with Pell window dressing, but at the end of the day his debt forgiveness scheme forces blue-collar workers to subsidize white-collar graduate students. Instead of demanding accountability from an underperforming higher education sector that pushes so many young Americans into massive debt, the Administration’s unilateral plan baptizes a broken system. This deeply regressive action — which fails even to acknowledge that most debt is held by folks with graduate degrees — will do nothing to jumpstart the reform higher education desperately needs,” Sasse said in a statement.

Other Republicans blasted Biden for not taking into account those that had already paid off their loans responsibly.

“Who will be forced to pay for Biden’s debt transfer scam? Hard-working Americans who already paid off their debts or never took on student loan debt in the first place,” House Minority Leader Kevin McCarthy said.

“What about Americans who already paid off their student loans?” Republican Ohio Representative Jim Jordan said.

Republican Arkansas Senator Tom Cotton said, “Biden owes Americans an explanation on why a truck driver who didn’t go to college is now responsible for the student loans of a rich lawyer.”

Cotton said colleges are the true culprits, calling them “bloated” and “self-serving.”

“I’ll be introducing a bill to hold these colleges accountable for debt, lower tuition, support non-college career paths, and save the taxpayers billions,” Cotton added.

Republican Georgia Representative Barry Loudermilk said that the “forgiveness” is an “insult” to the American people “who have worked so hard to pay off their student loans and other debts.”

“Not only does this decision raise legal concerns, it will also not help inflation and will cost American taxpayers an estimated $300 billion,” he added.

The total estimated cost for Biden’s one-time cancellation, not including the additional money for Pell grant recipients, is $300 billion, according to a study released Tuesday by the Wharton School of business at the University of Pennsylvania. The cost would increase to $330 billion if the program continues over the standard ten-year window, the study showed.

It's bullshit .. Biden trying to BUY votes ..and with taxpayer's money

... Must suck for those who paid off their loan to now realize it would have been "forgiven" if they didn't .. And a lotta kids haven't gone to college cuz they didn't have the money ..now they find that they didn't need it cuz the government is paying for it
... I always wonder what percentage of people that go to college actually learn something that'll earn them money ..even enough to at least pay off their loan... I know a few people that couldn't pay their loan after college .. They coulda been learning a trade instead

I wonder if it's coincidental that Biden's approval rating bumped up a few percentage points recently .. Has he done something worth a shit that i haven't heard about?

White House suggests Biden's $500B student loan handout will be paid for with deficit spending
Haris Alic
Wed, August 31, 2022 at 4:00 AM

White House officials say President Biden's decision to cancel between $10,000 and $20,000 in student debt for millions of Americans is fully paid for because of a drop in the federal deficit, an argument that suggests the full cost of the policy will just be piled on top of the national debt.

Fox News Digital has reached out to the White House multiple times over the past week about how it plans to pay for the student loan handout or if future tax hikes will be necessary.

The White House now says the handout is "fully paid for" through deficit reduction that is already occurring.

"It is paid for and far more by the amount of deficit reduction that we’re already on track for this year," said Bharat Ramamurti, deputy director of the National Economic Council.

"We’re on track for $1.7 trillion in deficit reduction this year. That means, practically speaking, compared to the previous year, 1.7 trillion more dollars are coming into the Treasury than are going out. And we’re using a portion of that — a very small portion of it — to provide relief to middle-class families, consistent with the president’s plan."

Economists say the White House's comments and unwillingness to outline offsets for the student debt handout, like tax increases or budget cuts, signals it plans to just pile the money onto the $726 billion federal deficit.

"They're just looking for any story they can tell that lets them get away from the fact that they're making the nation's finances worse," said Marc Goldwein, senior policy director at the nonpartisan Committee for a Responsible Federal Budget. "This is going to worsen the deficit. There is no way to dance around it."

Under Biden, the deficit has shrunk mainly because Congress has opted not to appropriate trillions in temporary coronavirus spending as it did at the start of the pandemic in 2020. Economists say the White House is arguing that the shrinking deficit gives the administration more money to spend on programs, like the student loan handout. But this means it won't go to debt reduction instead, forcing future taxpayers to pick up the tab.

"The analogy is a family going into debt for a $100,000 medical emergency, and the next year buying a $50,000 sports car and claiming that it's ‘free’ because they are no longer spending $100,000 per year on the medical emergency," said Brian Riedl, a senior fellow in economics at the center-right Manhattan Institute.

Biden last week announced plans to forgive $10,000 in student debt for borrowers making less than $125,000 annually. Pell Grant recipients will receive $20,000 in debt handouts, provided their income is below the $125,000 threshold. Administration officials claim that no individual or household in the top 5% of earners will benefit from the decision.

The White House is also extending a pause on student loan payments through the end of the year. Coinciding with the announcement is a new Education Department proposal that allows borrowers to cap undergraduate loan repayment at 5% of their monthly income, adding to the cost to taxpayers of the handout.

Administration officials claim that the cost of Biden's student loan handout cannot be fully accounted for since it's unclear how many borrowers will opt to take advantage of the opportunity. They say that it remains unclear how many individuals would have paid back the full amount of their loans over time anyway.

"All of this, as when it comes to costs, will also depend on how many of the loans canceled were actually expected to be repaid," said White House press secretary Karine Jean-Pierre.

But others were able to come up with estimates. The National Taxpayers Union Foundation issued an analysis earlier this week estimating that the student loan handout adds nearly $330 billion to the deficit over the next decade. A budget model by the University of Pennsylvania's Wharton School of Business asserts that the average cost per taxpayer will be $2,085.

But that could be on the low end. The Committee for a Responsible Budget puts the cost of the handouts at between $440 billion and $600 billion.

"If this ends up being added to the national debt, it's just going to drive up the interest costs needed to not default on that figure," said Riedl. "All of that is eventually going to drive up taxes because, at some point, you'll have to figure out a way to pay that debt."