President Joe Biden has so far been a compliant rubber-stamp for the hard-left, so expect him to eventually channel Sen. Elizabeth Warren when it comes to student loans. Indeed, the president this month asked his education secretary to prepare a report on whether the executive branch has the authority to cancel billions in outstanding obligations by fiat.
It shouldn’t take a college graduate to predict where that report will come down.
Mr. Biden said on the campaign trail that he favored canceling up to $10,000 in student loan debt for individuals. But that’s not enough for Sen. Warren and others, who want the administration to up the ante to $50,000, taxpayers be damned. Expect the president to be as firm as jello when it comes to his original position. Remember that Sen. Warren insisted the student loan program would be a money-maker for the Treasury when she championed its federal takeover in 2010.
The truly incomprehensible aspect of this debate is that there’s precious little discussion about what happens after the Great Loan Forgiveness Handout. It appears that Democrats simply want to wave their magic wands to wipe more than $1.5 trillion in student loans off the books and then continue merrily down the same road that got us there in the first place. What’s that definition of insanity again?
It’s also worth noting that taxpayers over the past year have already eaten nearly $100 billion in interest that the federal government has waived on outstanding student loan balances thanks to the pandemic. Principal payments have also been put on hold, but they’ll presumably resume once those in Washington deign an end to the virus crisis.
Under normal circumstances, savvy borrowers who kept their jobs during the COVID shutdowns might have taken advantage of the opportunity to pay down their balances interest-free. But with the intoxicating scent of debt forgiveness wafting through the air, they’d be suckers to pay a dime with the fiscally challenged Uncle Sam as their banker.
Speaking of suckers, how about all those parents and students who scrimped and saved for college to avoid going into debt in the first place? Or what about those fools who actually paid off their student loans before the current crop of Democrats decreed that personal responsibility is so behind the times? Where do they go to get their money back?
Some debt amnesty may be appropriate in hardship cases. But a blanket forgiveness program would be a sop to the wealthy in addition to being fiscally irresponsible and morally inappropriate. If the Biden administration believes it can bypass Congress on the issue, Republicans should ensure that the courts get the final word.