They are totally right; people who pick up the bill will be folks who did not go to college, folks who paid off their debt, and families (like ours) that never took on any student debt.
WSJ: The Taxpayer Con of the Century
Remember how Democrats sold their student loan takeover as a money-saver? Now millions of borrowers can’t or don’t want to repay their loans, so President Biden says he may cancel their debt. The taxpayers who repaid their loans or didn’t go to college will pay instead.
The Administration has repeatedly extended what was supposed to be a temporary pause on student loan payments and interest accrual. This reprieve has cost the government $100 billion and counting—money that Congress hasn’t appropriated. Now Democrats want Mr. Biden to compound the damage to taxpayers and the Constitution by writing off loans by presidential fiat.
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Most borrowers don’t need debt relief, but Democrats are hoping to buy themselves political relief before the midterm elections. Young people have soured on President Biden, and Democrats worry they will be as motivated to vote this November as they were to attend a 9 a.m. class. Democrats plan to bribe them to the polls. This week Mr. Biden told the Congressional Hispanic Caucus that he is weighing options, but “you’re going to like what I do on that,” as one Member related.
Federal student loans were established as part of the Great Society to help low-income students. Yet step by step, Democrats have turned student loans into an entitlement for academia and the affluent. Rather than make college free on the front end—which might have failed to pass Congress—they want to waive the costs at the back end.
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The Obama Administration expanded these plans to older borrowers. Democrats claimed the plans would reduce defaults and the cost of the loan program. They didn’t. About five million borrowers owing $110 billion are in default, up from 2.1 million owing $31 billion in 2013. Fewer than half of borrowers were even paying down loans before the pandemic.
Because some don’t earn enough to make a dent in their principal, their balances have accrued interest and grown. About one-quarter of all college grads earn less than $30,000 a year, and one in seven makes less than the poverty line, according to a recent survey. College grads without marketable skills or degrees often wind up working low-end jobs.
There’s dignity in work, but you don't need a college degree to pour drinks, as Alexandria Ocasio-Cortez did after graduating. Progressive young people duped by Congress and colleges led the Occupy Wall Street movement, and now some are leading union campaigns against businesses like Starbucks and Amazon. How about occupying Sen. Elizabeth Warren’s office?
Others go to grad school and pile on more debt. Federal graduate debt is uncapped, so colleges have added expensive graduate programs to reel in more subsidies. The average borrower who completes a master’s degree in film at New York University owes $113,180 and makes a mere $30,581 three years after graduation.
We don’t mean to pick on NYU. Many colleges saddle students with mortgage-size debts they can’t repay. The amount of debt held by borrowers owing more than $200,000 has grown 69% since 2017, and more than 30% for those owing between $80,000 and $200,000, while shrinking modestly for those owing less than $20,000.
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About 8% of borrowers account for 40% of the $1.6 trillion in federal student debt. Doctors and lawyers from top schools usually can repay their six-figure debt. But others are victims—some willing—of a massive con by government and academia. And now Democrats are demanding that taxpayers make them whole.
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Progressives claim that the Higher Education Act of 1965 grants the President sweeping authority to “compromise”—i.e., modify—student loans. Since Congress granted the Education Department the power to create student debt, they argue, the Biden Administration also has the power to cancel it. But Congress didn’t hide Mount Everest in a molehill.
In December 2020, Mr. Biden said it was “pretty questionable” whether he had the authority to cancel debt across the board. But now he may figure that the courts are unlikely to stop him, at least before the November election. Taxpayers and those who repaid their loans won’t have legal standing to sue. Congress might, but Democrats won’t sue.
Writing off loans won’t solve the student loan mess. It merely absolves Democrats and colleges of responsibility for creating it. What a moral, fiscal and democratic outrage.
Yep. This just about covers it.
Posted by: maria | Monday, May 02, 2022 at 08:14 AM