By Congresswoman Stephanie Bice
Last week, President Biden announced that he would cancel $10,000 in federal student loans and up to $20,000 for Pell Grant recipients. This will apply to borrowers making less than $125,000 per year for individuals and less than $250,000 for households. As a result, American taxpayers will bear the brunt of others’ debts, fuel will be added to already raging inflation, and our nation will further fall into crushing debt. Worst of all, this decision is a slap in the face to Americans who have made sacrifices to pay off their debt, or who made difficult life choices to not have student loans in the first place.
First and foremost, the concept of debt cancelling, or forgiveness, is simply inaccurate and misleading. There is no way to forgive debt. Someone must pay, and in this case, payment will fall to the American taxpayer. Forgiving student loan debt shifts the burden away from personal responsibility and onto the taxpayers at large, punishing them for the decisions of others. According to the Penn-Wharton Budget Model, this action will cost between $300 billion and $980 billion over the next ten years. Additionally, this handout will benefit top earners and highly educated graduates the most. Most of the debt is held by the top 60% of income distributions, and only 13% of adults in America have student loans. This giveaway overlooks the average American.
With the highest inflation in 40 years, working families are already paying an extra $536 per month on daily necessities. More reckless government spending that adds to the national debt and leads to higher costs are the last thing Americans need. Former Obama-Biden top economic advisor Larry Summers said it best: “Student loan relief is not free. It would be paid for. Part of it would be paid for by the 87 percent of Americans who do not benefit but lose out from inflation.” It’s clear that this shortsighted decision will exacerbate record-high inflation without addressing the root causes of rising tuition. In fact, I am concerned that his actions will only raise the cost of tuition in the long run.
This senseless decision hits home for me, as I’m sure it does for many of my fellow Oklahomans. I made the decision to take out student loans to finish college. Paying these loans off included making responsible financial choices and numerous sacrifices. Like many of you, my husband and I have made tough financial decisions to save for our daughters’ college expenses. The President’s decision is insulting to families across the country. Furthermore, it’s also unfair to those who immediately entered the workforce, chose to not take on student loans, enlisted in the military to serve our country, or decided to learn a trade instead of attending 4-year universities – all of which hold immense value to our country.
Our nation has always rewarded personal responsibility, hard work, and the American dream. Government bailouts like this undermine what our nation stands for, while creating a dangerous expectation that other debts will be forgiven in the future.
Well said. The only one who can “forgive” a debt is the creditor, and the creditor here is legion: banks, credit unions, etc. What is proposed is that the government give 10 grand to the debtor to pay that much off.
This benefits the upper tiers of society, at the expense of all tiers who pay taxes. What about the people who work with their hands? The people who took out a loan to buy a welding unit? An F-250 truck? A precision tool set? Nada, zero, zip. Apparently those people don’t count.