As radical Democrats in Congress jump on the Biden administration's reported consideration of student loan forgiveness, the left's argument that such action is needed for their "social justice" efforts to pursue "equity" for disadvantaged is contradicted by the reality of who stands to benefit the most from plans to erase more than $1 trillion in student debt.
Last week, White House Chief of Staff Ron Klain said that Biden would "look at what we should do on student debt before the pause expires," signaling again that student loan forgiveness is not off the table.
NEW: @WHCOS Ron Klain on what the president will do about student debt:
— Pod Save America (@PodSaveAmerica) March 3, 2022
"The President is going to look at what we should do on student debt before the pause expires, or he'll extend the pause." pic.twitter.com/izoc0dLaVW
Quickly, the usual suspects including Senator Elizabeth Warren (D-MA) and Rep. Pramila Jayapal (D-WA) began repeating their calls for President Biden to cancel student debt:
.@POTUS should #CancelStudentDebt.https://t.co/zq2SZcu3kS
— Elizabeth Warren (@SenWarren) March 4, 2022
93% of student loan borrowers say they’re NOT ready to resume payments in May.
— Pramila Jayapal (@PramilaJayapal) March 2, 2022
We have to cancel student debt — NOW.
The left's argument generally goes something like this: Student debt is a burden on low-income Americans, an insurmountable obstacle to upward mobility, and an unfair cost for those seeking higher education that disproportionately affects minorities.
As part of their absurd "fair-share" economics, Democrats claim that all Americans, especially the wealthy and successful, must pay more in taxes so that those who chose to go to college and had to take out federal loans can have their debt wiped away. According to Democrats, this must be done because "social justice" demands action to help the disadvantaged. But their arguments for canceling student debt are far from reality.
In the United States, the top fifth of households currently hold three dollars in student debt for every one dollar of debt held by the bottom fifth of households. The median income for households with student loans in 2021 was $76,400 and just seven percent of loan-holding households were below the poverty line.
As a result of elites holding more student debt — from their expensive and supposedly prestigious adventures in higher education — proposed student loan forgiveness is a massive dose of government welfare for the rich and successful who otherwise would have no issue repaying student loans. While pretending to be advocating for disadvantaged Americans, the left's radical proposal to cancel student debt would be a reward for many over-educated and underworked elites, the "expert" class that so often condescends hardworking Americans.
Even Brookings analysis found that those who are "higher income, better educated, and more likely to be white" would benefit the most from student loan forgiveness — not exactly in line with the left's often-flaunted commitment to being fair or equitable. "Those who borrowed to get college degrees that are paying off in good jobs with high incomes do not need and should not benefit from loan-forgiveness initiatives that are sold as a way to help truly struggling borrowers," Brookings' report explained.
What's more, canceling student debt punishes a wide swath of Americans for making good financial choices: those who didn't attend college, those who pursued higher education but didn't take out massive loans, those who have already paid back their loans, those who earned scholarships for academic or athletic performance, and those who served in the military.
Not only would the cost of student loan forgiveness be a disproportionate burden on hardworking Americans, it would be another burden on America's economy and debt for future generations. The various proposals put forward by leftists would all hit an economy that's already struggling under the Biden administration (via Brookings):
Based on data from the Department of Education, forgiving all federal loans (as Senator Bernie Sanders proposed) would cost on the order of $1.6 trillion.[1] Forgiving student debt up to $50,000 per borrower (as Senators Elizabeth Warren and Chuck Schumer have proposed) would cost about $1 trillion. Limiting loan forgiveness to $10,000, as President Biden has proposed, would cost about $373 billion.
The national debt is above $30 trillion, the Biden administration and Democrats in Congress continue to push for more reckless spending, and the COVID-triggered pause on student loan repayment has already cost the federal government more than $100 billion. To boot, inflation continues to skyrocket to 40-year highs under the Biden administration's economic policy.
If Democrats were to represent the will of the American people, they wouldn't even be considering canceling student loans. According to a poll last year, 54 percent of Americans are opposed to student debt forgiveness. Unsurprisingly, those with the means to pay back their loans are the ones more likely to support it. The poll showed "Fifty percent of households making more than $100,000 per year support forgiveness, compared to 45% of households making less than $50,000" and "Fifty-three percent of college graduates support forgiveness, versus 35% of people with a high school education or less."
But Biden continues playing with the idea of wiping away debt at the behest of far-left groups and activists. The American Federation of Teachers demanded Biden erase student debt on day one of his administration. Dozens of radical Democrats in Congress begged Biden to pursue and justify questionable executive authority to unilaterally cancel student debt.
Radical Democrats who rant and rave about their commitment to equity and social justice run opposite their stated values by pursuing student loan forgiveness. While spreading their calls to "tax the rich" they're pursuing a plan that would reward the rich. It's not the disadvantaged or any of their other divided identity groups that Democrats' plan would help, it's their wealthy, elitist friends.