Student Loan Cancellation Sets Up Clash Between Biden and the Left

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gundysburner

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Jul 25, 2018
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This isn't going to move the needle. They need something big, positive, and energizing as close to the election as possible. They are just softening things up and testing the waters with these small-scale "forgiveness" efforts. As you mentioned, it's a tiny fraction of the overall debt owed.

I'd be willing to bet that they extend the payment pause (arbitrarily) just long enough to do some form of broad "forgiveness" (re-distribution to future taxpayers) just before midterms in an effort to shamelessly buy votes. I'm guessing it'll be the $10,000 per borrower, and may come with a payment cap. The payment cap, I've read, will impose hardships on lower income borrowers since it would likely require proof of income (similar to filing taxes), so they may even waive that if their polling data indicates they need more help. Apparently income data cannot be shared seamlessly between the Dept. of Education and the IRS, so it would require individuals to file a form of some kind to receive the relief.

It won't do anything to solve the longterm problem, and may actually contribute to the inflation problems we have.

Our household would be relieved of $19,600 of loan debt if they do this, but I still don't support it.
I was surprised, given the rhetoric, to learn that the average debt is somewhere in the neighborhood of $36,000. Given the income difference over a lifetime, and education being an individual investment, it doesn't seem like a crazy amount to bet on yourself.

That being said, not addressing the elephant in the room-ridiculous rise in costs of education, accomplishes nothing in terms of solving this.
 

Birry

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Feb 6, 2007
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I was surprised, given the rhetoric, to learn that the average debt is somewhere in the neighborhood of $36,000. Given the income difference over a lifetime, and education being an individual investment, it doesn't seem like a crazy amount to bet on yourself.

That being said, not addressing the elephant in the room-ridiculous rise in costs of education, accomplishes nothing in terms of solving this.
I agree. But I've seen a lot of different stated goals for "forgiveness", and none of them seem to focus on the actual problem.

Many advocates seem to think that the primary goal of forgiveness is to address racial inequality or the wealth gap in general. Some think it should help younger people that are struggling financially due to the Great Recession and pandemic hardships (an economic stimulus, basically). Some think it helps set precedent for future reforms towards "free college". Some think that students are all victims of predatory lending from colleges, and are owed that money back. The reasons are all over the map. But none of them address the real problem.

There is no legitimate reason to forgive student loans for most borrowers. Those borrowers signed lots of papers stating that they understood how much they were borrowing and that they would pay it back every semester that they borrowed.

The problem for Biden and the Dems is that he campaigned on it and promised it. They are kinda screwed either way on this, and more so as inflation takes its toll.