Student loan debt: Biden administration to announce new proposals | CNN Politics:
The Biden administration is preparing new proposals aiming to reduce or cancel student loan debt for millions of borrowers, two sources familiar with the plans told CNN, another attempt to address a key issue facing voters before November’s election.
The expected proposals come nearly 10 months after the Supreme Court struck down President Joe Biden’s original student loan forgiveness program, which aimed to deliver up to $20,000 of relief to millions of borrowers struggling with outstanding debt. At the time, the president vowed to pursue another student relief approach by using a different legal authority.
The Department of Education soon began working on a different path relying on a different legal authority through the Higher Education Act of 1965. The new proposals are likely to be more targeted than the previous program would have been, laying out specific groups of borrowers who could get student debt cancellation.
Through the expected new proposals, first reported by The Wall Street Journal, the administration is aiming to ease student loan debt for borrowers experiencing hardship in their daily lives that would prevent them from being able to pay back their loans, one of the sources said. It will also help ease the burden on borrowers who have seen their interest significantly accrue over time, that source said.
I have no issue with student debt relief for those who were defrauded by fake universities or colleges. Similarly, if someone has provided a decade or more of public service (teaching in a low-income environment, say), debt relief strikes me as a reasonable “thank you” from society.
What I don’t understand is blanket debt relief for students loans otherwise. It’s legally iffy—already struck down by the Supreme Court once—and neither Biden nor Pelosi (when she was Speaker) thought it constitutional to begin with). Further, I’m still searching for a rationale that makes sense to me. People took loans they shouldn’t have so we the taxpayers should pay them instead isn’t convincing and it certainly doesn’t poll well among many voters. (Only 32% of registered voters say student loan debt is “very important” for candidates to talk about. Even among voters aged 18-29 it only gets 46% saying it’s “very important.”)
Given this, I didn’t really expect Biden to double down on finding ways to give out taxpayer money to people with student loans. But it looks like he’s going to.
And it’s a lot of money. “About 4 million people have seen their federal student debt canceled under Biden, totaling about $144 billion.” I hesitate to think of how much more Biden wants to spend on a elite group—college educated (by definition), predominantly upper class, and white. It’s crazy politics given how we could otherwise spend the money.
Even more importantly—which is hard to believe, I know—is that it’s these sorts of continuing government handouts that cause attendance at higher education institutions to be priced as they are. When the government pays for everything and there’s no cap on spending, colleges are incentivized to charge whatever they want (hint: they want to charge a lot). They overload themselves with administrators, build football stadiums, and whatever! The government is ultimately paying for it, so why not?
Related: The Associated Press says elite colleges will cost around $95,000 a year next year. It also says that’s okay because 60% of students will get financial aid “reducing their costs by two-thirds.”