Welp, hope you’re all excited to hear all the goodies stuffed inside President Joe Biden’s plan to cancel $10,000 in student loans for borrowers who are earning under $125,000, along with $20,000 per borrower who paid for their college via Pell Grants.
What this really means is that you and I are paying for a bunch a people’s college education through our hard-earned tax dollars. How generous of us, right?
According to a new report from the Daily Wire, White House officials were mulling over the move for a long time before finally deciding to go with the $10,000 figure, a report from everyone’s favorite purveyor of fake news, CNN, went on to say.
However, there were some Democratic lawmakers who were on board with the idea of canceling up to $50,000 per borrower. Biden made the call to extend the pauses on federal student loan repayment to January 2023, all the while borrowers who are buried beneath undergrad loans can cap repayment at around 5 percent of their monthly income.
Check out more details from the Daily Wire report:
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Nixing $10,000 of debt per borrower would cost $298 billion in 2022 and a total of $329 billion by 2031 if the policy is renewed each year, according to a nonpartisan analysis from the University of Pennsylvania’s Wharton School. Less than 32% of the funding would benefit Americans in the two lowest income quintiles, while 42% would benefit those earning more than $82,400 per year.
Indeed, a report from the Brookings Institution observed that one-third of student debt is owed by the wealthiest 20% of households, while only 8% is owned by the bottom 20% — likely because graduate degrees are often necessary for the most lucrative professions.
The report then goes on to mention that Biden’s policy could offer more distortions as potential borrowers weigh the possibility of future bailouts for loans.
“If student loan debt forgiveness is ongoing, students might eventually reorganize their financing toward additional borrowing,” the Wharton economists went on to explain.
What kind of lesson in personal responsibility does this teach people? It’s yet another way for the federal government to convince people that they are their nanny, a surrogate parent that has taken over the role of mom and dad in their lives and will care for them from cradle to grave.
It’s all about getting these folks to pledge their full loyalty to big government, selling out their own freedom and liberty for a lack of adult responsibility.
A brand-new survey conducted by CNBC has revealed that 59 percent of Americans are concerned that the cancellation of student debt is going to have a negative impact on inflation, making it rise even higher than it already is.
The idea of cutting student debt is one that is extremely popular among young people, while 30 percent of the individuals who responded to the poll believe there should not be any sort of debt cancellation. Only 19 percent of adults who are currently between the ages of 18 to 34 hold that position.
“The Biden administration’s move has also been criticized by Lawrence Summers — who served as Treasury Secretary under President Bill Clinton and National Economic Council Director under President Barack Obama — who contended on Monday that funds for loan cancellation could be better utilized elsewhere,” the report said.
“The worst idea would be a continuation of the current moratorium that benefits among others highly paid surgeons, lawyers and investment bankers,” Summers went on to comment. “If relief is to be given it should not set any precedent, it should only be given for the first few thousand dollars of debt, and for those with genuinely middle-class incomes.”
Summers, who is a bit unusual considering he’s a left-winger himself but is often skeptical of Biden’s economic agenda, recently took to social media to weigh in on debt cancellation, stating that if it is “unreasonably generous” could end up causing higher rates of inflation and make college more expensive.
“Every dollar spent on student loan relief is a dollar that could have gone to support those who don’t get the opportunity to go to college,” Summers stated. “Student loan debt relief is spending that raises demand and increases inflation. It consumes resources that could be better used helping those who did not, for whatever reason, have the chance to attend college. It will also tend to be inflationary by raising tuitions.”