What does it matter? Biden pronounced “zero inflation” a few weeks ago so everything should be just fine.
In all seriousness, there seems to be a pattern forming for anything Joe Biden touches. It either ends in disaster, with regard to Afghanistan, or it continues moving as a slow-motion never-ending disaster in the case of inflation and the damaged economy.
Government spending has been a big problem in fueling inflation yet there seems to be no end to the free handouts coming from the Biden administration.
The newest item, a potential $10,000 student loan forgiveness plan, could be another inflationary propellant waiting to happen:
Some experts believe the Biden administration could announce a decision on whether to extend a more than two-year-long pause on federal student loan debt this week, ahead of the current Aug. 31 deadline. Many borrowers are hoping the Education Department will extend that break and announce up to $10,000 in loan forgiveness.
Currently, about 44 million borrowers owe a collective $1.7 trillion in federal student loan debt.
Yet, a new poll finds Americans worry that debt forgiveness could have unintended consequences.
Already battling higher prices, 59% of Americans are concerned that student loan forgiveness will make inflation worse, according to a new CNBC survey, conducted online by Momentive among a national sample of 5,142 adults from Aug. 4 to 15.
Let’s forgo the term “forgiveness” and just call it a taxpayer bailout of student loans since that’s what it is.
When the student loan debt is “forgiven,” it still must be swallowed by something and that something will be the Department of Education handing out cash to lenders. It’s not a magical swipe of a pen that changes a $30,000 balance to a $20,000 balance. That $10,000 has to come from somewhere and wind up on someone else’s ledger
The country is divided on whether student loan forgiveness is a good idea at all. It would amount to a bailout of individuals who took out either more loans than they could afford to repay or over-paid for a degree that wouldn’t provide enough income in the marketplace to cover loan payments. The other scenario is college attendees who never graduated. They have student loans and no college degree.
It’s a matter of splitting the country into thirds. About one-third believe there should be no forgiveness under any circumstances. Another third says some forgiveness but only in certain situations, and yet another third that says let ‘er rip and cancel all student debt:
The survey found that 30% all adults say there should be no student loan forgiveness for anyone.
Yet there are sharp divides among those who hold this view. While 39% of men say no loans should be forgiven, just 22% of women agree with that statement. Only 19% of adults between 18 and 34 years old say no loans should be forgiven, versus 39% of those over 65.
Meanwhile, 34% of respondents say only those in need should have loans forgiven and 32% are in favor of loan forgiveness for all who have student debt.
If you combine the “cancel everything” crowd with the “cancel some” crowd, you wind up with about 66% supporting at least some kind of student debt cancellation. That’s probably the number the Biden people are looking at thinking this is a win-win to prime college-age and millennial college grads to the voting booth in November.
On the other hand, what if the plan backfires and inflation gets even worse in 2023 after the Bank of Biden starts canceling student debt?
Furthermore, what about the thousands and thousands of college grads that repaid their loans? Will they get a $10,000 credit? Of course not. For following the rules and paying their note on time they’ll get asked to flip the bill to forgive someone else’s student loans.
What about those who avoided the college debt trap and learned a trade or became successful without college? Why should their tax dollars pay a dime toward someone’s student loans?
Furthermore, does this become a yearly thing? How often do we discharge student loans because the President wants to win an election? If you ask others like Sen. Elizabeth Warren or Sen. Bernie Sanders, radicals both, they’d say you have to cancel it all to make a dent, an extreme position to be sure that ain’t happening.
The issue is a huge gamble for Biden so rest assured he’ll probably make the wrong move. Stay tuned.
