Biden Recklessly Bails Out Wealthy College Grads

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Those who spent years dutifully paying off their student loans were sent a clear message from the White House this week: that was a foolish thing to do. 

President Biden announced on Wednesday that he intends to cancel student loan debts of $10,000 for those earning under $125,000 annually, and $20,000 for Pell Grant recipients. Biden’s plan essentially amounts to yet another massive government bailout, this time to college graduates; while excluding both those who opted not to attend higher education and students who paid their debts off. 

Now to the vital question that is absent to supporters of student debt cancelation: does Biden have the authority to do this? According to a 2021 memo from the Department of Education, the President does not have the authority to forgive student loans unless authorized by Congress. Even Speaker Nancy Pelosi denounced the notion that the President has this authority. “The President can’t do it,” she stated bluntly last year regarding student loan forgiveness. “That’s not even a discussion.” 

Well, it turns out it was a discussion, and one Pelosi was evidently left out of. 

CBS White House Correspondent Steven Portnoy reported that Biden will execute his plan through a post-9/11 law that authorizes debt cancellations connected to a “war or other military operation or national emergency.” If you’re about to ask how that’s related to student debt cancellation, you may want to hold your tongue. According to the Department of Education, the Covid-19 pandemic is presently a national emergency posing a great obstacle to paying off loans. I can’t wait to use that excuse with my credit card company. 

But enough about petty trivialities like separation of powers or checks and balances. After all, if low-income college graduates receive some relief from their burdensome debts, surely it can’t be that bad, right? Well… not exactly.

For starters, this executive action doesn’t just support low-income earners. According to the White House’s own fact sheet, so long as student borrowers aren’t in the 5 percent of income earners, they could be eligible for debt forgiveness. By the White House’s admission, this program extends far beyond just low-income graduates. If Biden was truly looking out for low-income communities, certainly he would remember that most low-income individuals don’t go to college. Biden’s memory has been a forefront concern for many, but this oversight cannot be blamed on geriatric antics. It was deliberate.

So, if this government bailout won’t support low-income individuals and households, who does it help? According to FiveThirtyEight’s Nate Silver, young, middle-class college graduates, are a demographic which is especially progressive. Moreover, in what has got to be the coincidence of the week, The Washington Post reported that Washington D.C. has a higher federal student debt per borrower average than all fifty states.

To finish off the “bad policy” bingo sheet, there is the inflationary aspect to Biden’s forgiveness plan. Economist Jason Furman, who served in the Obama administration, called the program “reckless.” If you do not have student loans yourself, how does Biden’s student debt cancellation affect you? Furman answers, “everyone else will pay for this either in the form of higher inflation or in higher taxes or lower benefits in the future.” This, of course, is true for any government expenditure not fully paid for. What was once—and still is—basic economics was either forgotten or disregarded by this administration. Maybe we should stop envisioning our federal government as our 91-year-old great-aunt Betty sitting on a fortune and instead recognize that we are running an unconscionable tab on Uncle Sam.

The views expressed in this article are the opinion of the author and do not necessarily reflect those of Lone Conservative staff.

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