WaPo Editorial Board: Biden’s Student Loan Forgiveness Plan Will Provide A Windfall For Those Who Don’t Need It
[guest post by Dana]
The Washington Post editorial board weighs in on President Biden’s announcement:
Under progressive pressure to force grandiose policy changes, President Biden has generally embraced sensible reforms over flashy gimmicks. But his Wednesday student loan announcement did just the opposite.
The loan-forgiveness decision is even worse. Widely canceling student loan debt is regressive. It takes money from the broader tax base, mostly made up of workers who did not go to college, to subsidize the education debt of people with valuable degrees. Though Mr. Biden’s plan includes an income cap, the threshold does not reflect need or earnings potential, meaning white-collar professionals with high future salaries stand to benefit. Student loans, moreover, are a poor proxy for household income: An analysis by policy researcher Jason D. Delisle found that, in 2016, students from high-income and low-income families were just as likely to take on debt for their first year in an undergraduate program — and students from high-income families borrowed the largest amounts.
Mr. Biden’s plan is also expensive — and likely inflationary. The Committee for a Responsible Federal Budget estimates that extending the loan pause to the end of the year would cost $20 billion, while forgiving $10,000 for households making less than $300,000 would cost $230 billion. Together, these policies would nullify nearly a decade’s worth of deficit reduction from the Inflation Reduction Act. Moreover, it is unclear that the 1965 Higher Education Act even grants the president the legal authority to take such a sweeping step, given that it was historically understood to permit only more targeted relief.
Mr. Biden’s student loan decision will not do enough to help the most vulnerable Americans. It will, however, provide a windfall for those who don’t need it — with American taxpayers footing the bill.
Via Politico, I’m going to quote Democrats who have responded less than favorably to Biden’s questionable decision:
“Even some economists usually aligned with the White House, including former Clinton administration Treasury Secretary LARRY SUMMERS and former Obama administration economist JASON FURMAN, have criticized the cost of a potential student debt cancellation and warn that it could force future spending cuts or tax increases.”
Furman: “Pouring roughly half trillion dollars of gasoline on the inflationary fire that is already burning is reckless. Doing it while going well beyond one campaign promise ($10K of student loan relief) and breaking another (all proposals paid for) is even worse.”
Summers: “Every dollar spent on student loan relief is a dollar that could have gone to support those who don’t get the opportunity to go to college. … Student loan debt relief is spending that raises demand and increases inflation. … It will also tend to be inflationary by raising tuitions.”
Committee for a Responsible Federal Budget: “Debt cancellation would boost near-term inflation far more than the IRA will lower it.”
Sen. CATHERINE CORTEZ MASTO (D-Nev.): “I don’t agree with today’s executive action because it doesn’t address the root problems that make college unaffordable. We should be focusing on passing my legislation to expand Pell Grants for lower income students, target loan forgiveness to those in need, and actually make college more affordable for working families.”
Rep. JARED GOLDEN (D-Maine): “This decision by the president is out of touch with what the majority of the American people want from the White House, which is leadership to address the most immediate challenges the country is facing.”
Rep. CHRIS PAPPAS (D-N.H.): “[T]his announcement by President Biden is no way to make policy and sidesteps Congress and our oversight and fiscal responsibilities. Any plan to address student debt should go through the legislative process, and it should be more targeted and paid for so it doesn’t add to the deficit.”
Rep. SHARICE DAVIDS (D-Kan.): “It’s not how I would have addressed the issue.”
Rep. TIM RYAN (D-Ohio): “While there’s no doubt that a college education should be about opening opportunities, waiving debt for those already on a trajectory to financial security sends the wrong message to the millions of Ohioans without a degree working just as hard to make ends meet.”
Sen. MICHAEL BENNET (D-Colo.): “In my view, the administration should have further targeted the relief, and proposed a way to pay for this plan. While immediate relief to families is important, one-time debt cancellation does not solve the underlying problem.”
I was surprised by the board’s view. Why so reasonable?Dana (1225fc) — 8/25/2022 @ 8:42 am
I think that, for all his faults, Trump has sensitized the political class to the needs of the great unwashed. Not everyone goes to college, and particularly not to expensive private colleges, and whatever the pressure on new graduates might be, an income cap of $300,000 does not target this to the needy.
It is a blatant use of government funds to buy votes. Worse, from the WaPo perspective, t will likely backfire with resentments from others in the Democrat sphere who will be responsive to the Trumpian message of “they don’t care about you.”Kevin M (eeb9e9) — 8/25/2022 @ 9:26 am
The Babylon Bee from a couple of years ago. They are prophesy even more than they are comedy.NJRob (86271c) — 8/25/2022 @ 9:46 am
Funny how class resentments trump nearly everything. Nobody cares about the forgiven PPP bailouts handed to anything that looks like a business. (Check your zipcode for local recipients of free money: https://projects.propublica.org/coronavirus/bailouts/ ) I didn’t hear anyone on the right carping about the farmers’ votes being bought by Trump after his “easy to win” trade war. And trillions of tax cuts to the 1%, meh, who cares, right?
But young college grads, man. *Those* people, amirite?john (cd2753) — 8/25/2022 @ 10:01 am
@4 The big difference, John, is that PPP was duly passed by Congress.
Biden is trying to tease out a novel legal theory to do this unilaterally.whembly (b770f8) — 8/25/2022 @ 10:35 am
Bailouts are wrong. Those bailouts however were passed by Congress into law and were meant to allievate a situation caused by government with their illegitimate forcrd lockdowns. Students are willfully entering into a contract, a foolish, one-sided contract, but still a contract with terms they agreed to. They’ve already had 2 years of avoiding payments paid for by the taxpayer. Time to pay for your own debts.NJRob (86271c) — 8/25/2022 @ 10:37 am
If the Democrats crater this November, it’s because Biden caved to “progressive pressure”.Paul Montagu (062b7e) — 8/25/2022 @ 10:38 am
There’s a reason the least liberal Democrat out of a slew of leftists was nominated.
Least “liberal.” Hahahahahaha
Socialism on steroids.NJRob (86271c) — 8/25/2022 @ 10:45 am
No hyperbole there.Paul Montagu (062b7e) — 8/25/2022 @ 10:59 am
Wait a minute, isn’t Sen. Warnock a pastor, called to a higher standard?Paul Montagu (062b7e) — 8/25/2022 @ 11:27 am
Curious what Manchin and Sinema have to say about this. Because old Joe just appropriated himself another 250 billion dollars, kind of kneecapping their arguments on the budget.
When President Trump (ow!) builds a big beautiful super duper wall in 2025 through executive order, he will, with a tear in his eye, thank Joe for showing him the way. Maybe he’ll go visit him at the Guantanamo Senior Center to deliver his thanks in person.
I am interested by the number of cmplaints coming out of the Senate’s Democrats. Will they join in the inevitable lawsuit to stop this EO in its tracks?Appalled (03f53c) — 8/25/2022 @ 11:32 am
Manchin destroyed W Va with his bill. After the Supreme Court ruled that the EPA exceeded its authority in ruling CO2 a pollutant to put coal mining out of business, Manchin supported an amendment giving the EPA that authority.
No such thing as a moderate democrat. All the “moderate” democrats run as republicans.NJRob (99b600) — 8/25/2022 @ 11:41 am
Karine Jean-Pierre says White House doesn’t have ‘real sense’ of how much student loan handout will cost
The White House can’t be sure how much President Biden’s student loan forgiveness program will cost, White House press secretary Karine Jean-Pierre says. Jean-Pierre made the statement during her White House press briefing on Thursday, telling reporters that the cost of the program will depend on borrowers and the nature of their loans. Watchdog groups say Biden’s plan will cost taxpayers up to $600 billion over the next 10 years.
“All of this, when it comes to cost, will depend on how many of the loans canceled were actually expected to be repaid,” Jean-Pierre said. “It will depend on how many borrowers actually take up this opportunity before we have a real sense.” Jean-Pierre went on to argue that the cost will be offset by the deficit reduction included in other Biden administration priorities. She told reporters that the bill will not be “fully paid for” internally as past White House initiatives have been, but will be further offset by the resumption of loan payments after being paused since 2020. – FoxNews.com
The Biden Plan: run the country into a ditch; die; get government-expensed funeral, a postage stamp, an Amtrack repair yard named after you and leave 350 million citizens stuk waiting for an electric tow truck to pull nation out of hole… in 2122.
Storm the castle.DCSCA (7fc378) — 8/25/2022 @ 12:05 pm
There are already many programs in place that provide accelerated student debt reduction to medical students who commit to providing medical service to rural or other underserved communities. There are similar programs for graduates who commit to teaching primary or secondary students. Surely programs like these could be expanded to provide accelerated debt reduction to graduates who agree to serve as EMT’s, firefighters or other public services. Not only would the public benefit from having additional help in these areas, the graduates could be expected to develop an indreased sense of public purpose. The current plan does none of these things.John B Boddie (bee833) — 8/25/2022 @ 12:11 pm
Lest you forget:
“In 2005, then-Senator Biden voted for a bill called the Bankruptcy Abuse Prevention and Consumer Protection Act. The bill was meant to address abuse of the bankruptcy process. It made it more difficult to declare bankruptcy, and much, much harder to have student debt discharged. Under the 2005 law, educational loans can only be discharged if not doing so would impose an “undue hardship.”… Republican Sen. Orrin Hatch introduc[ed] the bankruptcy bill for a Senate floor vote in 2005, thanking Biden for years of tireless support for helping write and advance the legislation.”
He’s a bum.DCSCA (7fc378) — 8/25/2022 @ 12:16 pm
The Fed loan program will continue. Let that sink in.
How in the Hell does continuing a mistake make any sense!?!?Colonel Haiku (8b99b0) — 8/25/2022 @ 12:36 pm
“The Ant worked hard, and paid his way
The Grasshopper partied on Student loans, and learned NOTHING
When the winter came, The Man came, and took the Ant’s food, and gave it to the Grasshopper, saying
‘You GO! Grasshopper! You vote democrat, so YOU RULE!! ‘
The Ant watched the Grasshopper eat his food, and thought.. There’s a Moral here…”
—- gilbarColonel Haiku (1bdfbf) — 8/25/2022 @ 1:55 pm
@17. “Blue Bonnet margarine was .99. Now it’s $1.79. Kroger lasagna was $9.99. Now it’s $15.99. The Ant and the Grasshopper put their food back on the shelf and thought…
There’s a Moral here…”
Storm the castle.DCSCA (4e82b1) — 8/25/2022 @ 2:07 pm
Doesn’t the House of Representatives have power of the purse?Charlie Davis (6775d5) — 8/25/2022 @ 2:12 pm
Went to Walmart yesterday and saw that $8 of Walmart breaded chicken was now $15. Butter has gone from $2 on sale to $3.50 on sale. Eggs are $3.70 a dozen up from $1.29.
People see this EVERY TIME THEY SHOP.Kevin M (eeb9e9) — 8/25/2022 @ 2:15 pm
“the needs of the great unwashed.”
Sure Kevin, great analysisEPWJ (650a62) — 8/25/2022 @ 2:18 pm
Doesn’t the House of Representatives have power of the purse?
Apparently not. For the last decade or so, Dems have been pushing the idea that authorization is the same as appropriation. This fails when it gets to the high court (as it did with Obamacare subsidies when Congress refused to pay for them), but they keep trying. This time they argue that a 1965 law allowed the Secretary of HEW to alter the terms of direct loans and that this is all the appropriation they need. Their echo chamber (most of the press) talks up all the benefits and neglects the constitutional issues.
When the courts strike it down, people are being primed to think it’s those wacky right wingers.Kevin M (eeb9e9) — 8/25/2022 @ 2:21 pm
Doesn’t the House of Representatives have power of the purse?
Charlie Davis (6775d5) — 8/25/2022 @ 2:12 pmRip Murdock (d2a2a8) — 8/25/2022 @ 2:26 pm
https://getyarn.io/yarn-clip/6a2141fd-6c42-4f29-bf32-bebc70731554DCSCA (4e82b1) — 8/25/2022 @ 2:35 pm
^For Royalist Rip’s 23- not 34.DCSCA (4e82b1) — 8/25/2022 @ 2:36 pm
Glorious.DCSCA (e3e791) — 8/25/2022 @ 3:32 pm
OT- Remembrance of note; August 25, 2012
R.I.P. Neil Alden Armstrong
American astronaut; first man on the moon
Ad AstraDCSCA (e3e791) — 8/25/2022 @ 3:46 pm
Kevin M (eeb9e9) — 8/25/2022 @ 9:26 am
No it won;t/ Nobody’s taxes will go up – the money has been spent. It’s just that money the federal government was accounting for as coming in in future years, won’t come in. And it’s total nonsense to speak of low income people paying back those loans. They won’t be paid back. They will just add to the total amount of the national debt. Now you could make the argument that there’ll be less money for Medicaid as a result.
Anybody who is likely to resent other people getting a better deal, is more likely to resent “the rich” or “corporations” not paying more taxes, and the Democrats have that covered..
People support forgiveness of student loans, but they don’t rate it a very important issue, and they support more reducing the cost of college for future students.
How? Biden doubled the amount of potential loan forgiveness for people who had had their tuition partially paid by Pell grants. I’m not sure how that makes sense, but, in the Administration’s calculation that shows they care about poor people, especially black poor people, since Pell grant recipients skew black.Sammy Finkelman (1d215a) — 8/25/2022 @ 4:05 pm
What is contested is that the Federal Claims Collection Act of 1966 sets very strict procedures for doing that. The rebuttal to that is some Covid act.……
Also a Virginia Law Review article claims that nobody can sue because nobody has standing. It doesn’t cost any person, or any state, any money.Sammy Finkelman (1d215a) — 8/25/2022 @ 4:15 pm
I was surprised by the board’s view. Why so reasonable?
The WaPo editorial board works for the second wealthiest man in the world (the wealthiest until this year). Student debt forgiveness walked in hand-in-hand with a wealth tax in the 2020 Democrat primaries. If the Politburo got this one in, could the other be far behind?nk (75c976) — 8/25/2022 @ 4:24 pm
There’s a lot of house and car loans that need forgiving.Kevin M (eeb9e9) — 8/25/2022 @ 4:26 pm
@30: Besides, do you thing Bezos is a borrower or a lender?Kevin M (eeb9e9) — 8/25/2022 @ 4:27 pm
>>it will likely backfire with resentments from others
No it won;t/ Nobody’s taxes will go up
1. Everybody’s taxes will go up. They always do.
2. Resentments are not usually based on logic. Envy, hatred and misfortune are much more likely causes.Kevin M (eeb9e9) — 8/25/2022 @ 4:29 pm
Becas=use to get the loan forgiveness, you have to apply and they don’t know what percentage of those eligible may apply, although the loan servicers are supposed to tell them about it.
Also, some people may flub it. The application forms probably won’t be ready by January, and are even less likely to be approved, and if someone owes less than $10,000 they may feel they don’t owe any money. But the payments have to be kept current to be approved. You can imagine the feeling of someone knowing they are eligible, and having to make a payment in January and another in February and maybe in March while waiting for official approval — all money absolutely down the drain.
But they have to pay it or they lose the forgiveness.
Incidentally, for income limitations, people can use either their 2020 or their 2021 income. If they didn’t file a tax return for those years, the IRS, separately, is waiving penalties if they will be filed by September 30. The big penalty is if they owe money – if they get a refund I am not sure if there is any penalty.Sammy Finkelman (1d215a) — 8/25/2022 @ 4:35 pm
Loan forgiveness applies to any loans that originated by June 30, 2022.Sammy Finkelman (1d215a) — 8/25/2022 @ 4:36 pm
My car dealer never told me that unless I bought a car I would never have a good job. In that regard, he was more honest and less manipulative and exploitative than the political-educational combine. And gave me more value too.
As for houses, where’s you bin? Remember the subprime crisis? And there’s still dockets full of no-recourse foreclosures in every courthouse.
Hey! There’s an idea. The students can surrender their diplomas in exchange for the balance due on their loans.nk (75c976) — 8/25/2022 @ 4:37 pm
There are also couple of other things regarding student loans that Biden wants to make into regulations, which may take some time to go through procedures:
1. Reduce the income based repayment plans for undergraduate loans rom 10% of “discretionary income” to 5%
2. pay all the residual monthly interest for someone in a repayment plan if the interest is not covered by the minimum payment based on income )loan balances cannot increase for someone in a repayment plan)
3. Reduce the number of years someone has to pay 10% -> 5% from 20 years to 10 years for borrowers with an original loan balance of $12,000 or less. (intended to cover anyone who enrolled in a community college only)
https://www.whitehouse.gov/briefing-room/statements-releases/2022/08/24/fact-sheet-president-biden-announces-student-loan-relief-for-borrowers-who-need-it-most/Sammy Finkelman (1d215a) — 8/25/2022 @ 4:37 pm
@30: Besides, do you thing Bezos is a borrower or a lender?
No, he’s rich and he does not want his riches taxed, and he sees this as the nose of the Sanders-Warren-AOC camel into his money vault.nk (75c976) — 8/25/2022 @ 4:40 pm
The people who will get a windfall are those on the lower end of the economic spectrum. to whom $10,000 is a great deal. While a lot of the money will go to those with higher incomes it won’t be such a great portion of their loan balance.Sammy Finkelman (1d215a) — 8/25/2022 @ 4:40 pm
The students can surrender their diplomas in exchange for the balance due on their loans.
Only if the schools and course of study are public records.Kevin M (eeb9e9) — 8/25/2022 @ 5:01 pm
No, he’s rich and he does not want his riches taxed, and he sees this as the nose of the Sanders-Warren-AOC camel into his money vault
It won’t be just him. The income tax was supposed to be leveled only on the filthy rich.Kevin M (eeb9e9) — 8/25/2022 @ 5:02 pm
The people who will get a windfall are those on the lower end of the economic spectrum. to whom $10,000 is a great deal. While a lot of the money will go to those with higher incomes it won’t be such a great portion of their loan balance.
So, capping it at an income of $50K, which should gather in all the baristas, would be fairer, more likely in line with the 1965 law, and far cheaper to the taxpayer.Kevin M (eeb9e9) — 8/25/2022 @ 5:05 pm
But young college grads, man. *Those* people, amirite?
john (cd2753) — 8/25/2022 @ 10:01 am
If you’re a married couple making $250K, or a single person making $125K, you can afford to make your student loan payments.
I see another MUH PPPP LOANZ red herring proffered up, with a dash of BILYUNAIR TAX CUTZ and FARMRZ SUBSIDEEZ thrown in.Factory Working Orphan (2775f0) — 8/25/2022 @ 5:16 pm
Those who propose robbing Peter to pay Paul will always have the support of Paul.norcal (da5491) — 8/25/2022 @ 5:22 pm
But the government man came along and distributed it fairly.
What are you, some kind of Russian? In the good old Anglo-Saxon tradition, the baron sent his knights to take the bread and bring it to the castle where he, his retainers, and his dogs ate it. The peasants boiled the bran into a porridge.nk (58186c) — 8/25/2022 @ 5:29 pm
I wonder, would Trump have done the same thing if Kim Kardashian had asked him to?
This is not socialism, comrades. It’s the people with the nuclear weapons and F-15s not being as tyrannical as they could be.nk (58186c) — 8/25/2022 @ 5:50 pm
David Burge (@iowahawkblog) goes scorched earth on school loan forgiveness and the whole predatory practice of school loans.
To continue: yes, student loan relief helps out poor people who were lured at young age into taking student loan debt to attend a shitty for-profit college, on the premise it was a ticket to a lucrative career in makeup and hair styling. In a way, that’s good.
But it’s not really good unless the fed loan program also produces a shit list of colleges like this with unacceptable loan default rates that are blackballed from further program participation. I’m sorry if this means financial problems for venerable Larry’s Barber College.
As I said the other day, the entire raison d’etre for these places is insane state occupational licensing requirements, like Texas’s 1500 minimum hours to be a barber. And… surprise! The biggest lobbyists for these requirements are the barber colleges themselves.
Me: This is important.
Student debt relief also helps those who drop out of college due to lack of preparation, leaving them with no degree, a lost year of wages, and plenty of debt. Again good. But the follow up should be the college refunding the student’s subsidized tuition to the loan program.
The lender (our) attitude should be: we subsidized this student’s education at your school, on the premise they were prepared and the experience would benefit them enough that they would be able to pay it back. Clearly that didn’t happen, so fork over the refund.
Read the whole thing. I don’t agree with everything, but it’s still pretty good.
https://threadreaderapp.com/thread/1562491364431974401.html?fbclid=IwAR1r4orc_7bYccvliS1AxBJOIy7OyYnI6O5BuQq8IeuoVQ3Kfv-OCkRwRncTanny O'Haley (8a06bc) — 8/25/2022 @ 6:33 pm
@47: You’re right about hat. Biden has said that any revolution would have to contend with those things.
Except that, in 1991, the Russian revolution succeeded without a shot.
Or at least very few.Kevin M (eeb9e9) — 8/25/2022 @ 6:43 pm
25% of student loans are taken out by those who get graduate degrees. Only 8% are taken out by the bottom 20% of the population. Student loan forgiveness mostly helps the rich.
For those who are for student loan forgiveness I have a question. Where does the money come from to pay for those student loans? If you say the government, then you have to understand that the government gets their money from people like me who is on Social Security and a very small pension. That’s theft and you’re not a very nice person for supporting theft.
https://www.brookings.edu/policy2020/votervital/who-owes-all-that-student-debt-and-whod-benefit-if-it-were-forgiven/Tanny O'Haley (8a06bc) — 8/25/2022 @ 6:45 pm
@50 Where does the government get the money for tax cuts for the rich or defense contractors? How come you never ask that question??? Marjorie taylor green student loan forgiveness is socialism! White house you got $183,500 in PPP loans forgiven.asset (3c66a9) — 8/25/2022 @ 10:57 pm
Tanney, I am not for this, but the reality is that we all benefit for some things that other people don’t benefit from. Frex, you did not pay in all the money you are going to get from social security and I am never got to be able to collect what I paid in because I don’t quite have enough quarters and I currently pay into a public plan that is not SS. I don’t think you believe that you are stealing my money that I paid in and will never get out, but you are benefiting from it and I’m never going to. By your standards, are you a nice person or a not nice person, or is it just that sometimes other people benefit from things you don’t and you sometimes benefit from things other people don’t?Nic (896fdf) — 8/25/2022 @ 11:56 pm
Taney: “then you have to understand that the government gets their money from people like me”
The problem is that the government doesn’t automatically raise taxes to pay for things like this. Your taxes will likely be about the same next year as they were this year. That’s the problem….whether it’s increased military spending or social spending, it’s placed on the virtual credit card….for the next generation to have to deal with. So a politician can run on doing this great thing…that who among us can really be against….at little cost because both sides have lost all credibility on spending and deficits.
Taney: “the whole predatory practice of school loans”
Certainly there needs to be better transparency as to what certain careers are worth versus the tuition cost. If you are pursuing a humanities degree, what are your realistic opportunities and the likely time to pay it back? I hate to put all of that on the school but there should be transparent placement statistics to give the consumer a clear picture and guidance counselors available to make sense of it all.
I suppose too it’s harder for the lender to assess education risk vice say taking a home mortgage. The latter you can look at income, saving, and spending history and do the math and get a good picture of risk. With schooling, especially for younger adults, there’s no great way to measure maturity, focus, and motivation. Parents may not have a clear picture until it’s too late. Who hasn’t seen people crash and burn at college because of inevitable distractions or poor habits. High school grades can be an imperfect indicator.
I think we all want to see motivated talented individuals…with a clear plan…..get the resources to go to school. There are clear cases where it’s obvious. Government is probably not very good about deciding the edge cases where it’s less obvious. That’s why the notion of free college for all misses the human reality that that’s a bad model. You should earn your way in through academic performance and then understand the risks of non-performance. I’m pro meritocracy….AJ_Liberty (c916b7) — 8/26/2022 @ 2:39 am
AJ_Liberty (c916b7) — 8/26/2022 @ 2:39 am
The worst thing may be Ph.D degrees in the humanities, and law degrees are becoming financially unsound I read.
Nursing and accounting are undergraduate degrees, while medicine and education are post graduate.
Democrats are eager to punish and maybe close private for profit educational institutions but they let private non-profit schools off the hook, like as if only private for profit schools have a profit motive..Sammy Finkelman (b434ee) — 8/26/2022 @ 7:37 am
46. nk (58186c) — 8/25/2022 @ 5:29 pm
And then came the potato. And, more thana hundred years later, came the potato blight.Sammy Finkelman (b434ee) — 8/26/2022 @ 7:42 am
\some more about the loan forgiveness.
The loss to the government is not $300 billion because some of that debt was not on a course to be repaid anyway. Before the coronavirus, more than 20% of student loans were in default. But many of these loans had fairly small balances – could be something like people who dropped out of school.
It is argued that people who don’t owe money on student loans also are motivated to get better jobs. It could also be argued that if Biden gets his way on the new regulations, with repayments capped at a fairly low amount, (5% of disposable income for ten years after repayments start) the loss to the government from future loans could balloon. Once a person has hit the probable cap, they’ve hit the cap.
One complaint is that a person helps pay tuition for a younger sibling, they get no credit for it. Parents who took out loans are included in the loan forgiveness but not others I think.
It is more accurate to say that the forgiveness cap for undergraduate loans is $20,000 than $10,000 because about 60% of people (with current balances?) used a Pell grant to pay for at least part of their undergraduate education (they may have outstanding balances either because tuition was high where they went or because they took advantage of the student loan kickback to take out cash to pay for housing or other living expenses while attending school, not to mention books or other non-tuition school necessities. (That is not audited, but it’s presumed it’s not for more than living expenses and so everyone would qualify. If they also have other sources of support, like family or wages, they can still attribute living expenses to the loan.)Sammy Finkelman (b434ee) — 8/26/2022 @ 8:06 am
“And drove down to Newark, Delaware where my dad worked at an automobile agency. And I walked in and I had my spikes.”
“And because the reason I was going down, when your dad works at an automobile agency, the great advantage you get a new car to go to the prom or a good used car. You think I’m joking. I’m not joking. And so I went down to my 51 Plymouth with beach towels for seat covers. And I had my uniform on, my spikes off. I ran in and the woman’s name was Mary, who ran the place. I said, ‘Mary, where’s dad?’ She said, ‘He’s out in the lane going into the repair shop.’ I’ll give you my word, true story. And my dad was a well dressed, refined fella. And I walked out and my dad was pacing back and forth between the big garage door, going into the repair shop and the door going out of the showroom. And I looked up, he said, ‘Oh, Joey. Honey, I’m so sorry. I’m so sorry.’ I thought God, something happened. This is before cell phones. So I thought something happened to one of my brothers or my sister or my mom or something. I said, ‘What’s the matter, dad?’ He said… ‘I went to Charlie and asked to borrow the money.’ He said, ‘He won’t lend it to me.’ He said, ‘I’m so ashamed. I’m so damn ashamed. “
Dementia Joe on student loan forgiveness…Colonel Haiku (c1c91e) — 8/26/2022 @ 10:02 am