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Student Loan “Forgiveness” For Deadbeats

President Biden is expected today to bail out millions of student loan borrowers by paying off $10,000 of outstanding student loans for every borrower with an income below $125,000 per year. (We thought Congress had the power of the purse?)

Why do they call this giveaway “forgiveness?” It’s a typical Washington weasel word. The only effect of this policy is to shift the cost of college from the students to the taxpayers – almost half of whom never even graduated from college. How is that “fair?”

Our friend Rich Vedder put it well:

My crude estimate is that the moratorium on student loan interest payments alone in the 28 months since it began has lowered federal revenue by more than $200 billion. This, at a time when the federal debt exceeds $30.5 trillion. Even a modest student loan forgiveness program likely would involve $400 billion to $500 billion in additional lost government revenue. Someone, someday, must pay these debts unless some future administration decides to default on the government’s obligations or, perhaps more likely, reduce their magnitude through deliberate inflation.”

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