For a guy that can boast a half century of public service at the national level, Joe Biden really doesn’t get it. He has been a part of a lot of history in the past fifty years or so. He’s seen an awful lot. And in that time, he’s gotten a lot wrong. Robert Gates, the former Defense Secretary in the Obama Administration echoed that sentiment. He’s a friggin’ Democrat. You would figure he’d at least have Biden’s back when it came to stuff like that. But that’s not all Biden has messed up.
And he’s about to do it again.
Biden has told the world that he’s still considering forgiving student loan debt. There are several problems with this, but Biden sees it as a way to get some of the youth vote. The problem is it won’t work on several fronts.
First of all, during the campaign, Biden promised to get rid of up to $50,000 in student loan debt. He’s basically put a hold on repayment during COVID, and wants to extend it through September, but now, he’s looking at actually forgiving debt. Not $50,000 per loan, but more like $10,000. There are problems galore with that.
First of all, students (millennials all) will not be happy with just getting $10k taken off what they owe. They were promised $50k to be forgiven. This is akin to Biden promising Georgians that if they voted for Jon Ossoff and Raphael Warnock for the Senate, he’d make sure that the $2,000 checks would “go out in the mail tomorrow”. Well, it wasn’t $2,000, it was $1,400, and it took two months to get it done. Call it a semi-broken promise with the stimi checks, and it’ll be a semi-broken promise with the student loan forgiveness.
Second, it is going to cost the government $321 billion to remove that much student debt from the books. Basically, the government is going to write the check to the banks who granted the loans in the first place. That is just like the government printing more money. Do you know what that leads to? Inflation! At a time when Democrats in Congress are wracking their brains trying figure out how to slow down the inflation train that seems to be in runaway mode, Biden is trying to speed it up.
Third, while the forgiving student debt may be popular among today’s college crowd, and those with the debt, it’s not popular with people who have gone through the college loan dance and paid theirs off. It’s been asked multiple times if THEY would also get some sort of break on what they had to repay, and the answer repeatedly comes back as “NO!”. People that are out there working, dealing with 8.7% inflation, and gas prices at historic highs are not real keen on helping out college kids…especially those that majored in Women’s Studies, or Philosophy, and can’t find a job that pays more than minimum wage.
Finally, in case you’ve missed it, the economy in this country is not doing well. The GDP dropped 1.4% in the first quarter. That’s not a good sign. And when the government is going to step up and spend $321 billion that they don’t have to spend, it’s going to cause even further ripples. Remember…a recession is defined as two straight quarters of decline of the GDP. Well, we’ve had one. And traditionally when the Fed decides to raise interest rates, it doesn’t help the GDP a bit. The Fed has hinted they are going to raise interest rates seven times this year. And we are going to be looking at a recession next year for sure.
In short, the country cannot afford to tackle student loan debt today, or in the future. As someone that paid off my wife’s student loans back in the day, I’d be the first to say, if you took out $100,000 in student loans to study a major like Art History, or something that there aren’t any jobs in, you’ve made a bad life choice. You need to realize that. Rather than ask the rest of America to bail you out, I’d suggest you get another job, maybe one that allows you to make a real living, and stop working at McDonalds!
Carry on world…you’re dismissed!