Credit Joe Biden with taking a horrible idea and making it better. But the very idea of forgiving any amount of student loan debt is so fundamentally flawed that no amount of lipstick is going to make that pig any prettier.
This is pretty clearly something that Biden didn’t want to do. Why else would he have dragged his feet this long before finally making good on his campaign promise to forgive $10,000 in student debt, which was in itself a milder version of Sen. Elizabeth Warren’s and Sen. Bernie Sanders’ plans to forgive $50,000?
And when he finally announced his plan yesterday it included an income cap of $125,000 for a single person and $250,000 for a married couple. He also gave a bonus of another $10,000 in forgiveness to anyone who received an income tested Pell Grant.
Nice try, Joe, but none of that makes a bad idea much better.
The income cap, of course, is just a snapshot in time. So, for example, a young lawyer early in her career might not be making six figures yet, but she will. She would have easily been able to pay back her loan over her career, but she gets the relief now only because she hasn’t reached her full income potential yet.
And, as for the Pell Grants, those were based on the low incomes of the students’ parents. Thanks to the grants and assuming they completed their degree, a college grad will make about twice as much as someone who didn’t go to college. What does the low income of a student’s parents have to do with the circumstances of the college grad now? And, by the way, these folks got up to almost $7,000 a year in grants while in school that they never have to pay back. So, why do they get still another bonus?
Biden probably balked at this because he understands the bad politics for Democrats. Two out of three American adults didn’t complete a four year degree. They have every right to question why people who did, and who on average make about twice as much as they do, should get this big government handout.
And then, of course, there are the millions of us who did go to college, did take out a loan and did, in fact, do what we promised to do: pay it back.
This is bad politics for Democrats because it should be. Asking taxpayers to pay off the student loans of people who were irresponsible or careless in taking on debt they couldn’t afford is horrible public policy. And worse, Biden’s plan does nothing about the real problem: the skyrocketing cost of higher education. What’s going to happen next year when a new crop of college grads starts demanding that they get the same handout that last year’s grads got?
This could well stop the progress Democrats have made in this election cycle. It was beginning to look like a combination of legislative wins, the abortion issue, public concern over gun violence and the easing of gas prices might result in a better November than had been predicted for Biden’s party. Now this policy will remind voters without a college degree just how much disdain the Democrats have for them.
And, of course, it might not even happen. There are legal questions about the president’s authority to do this. There will be lawsuits and if they wind up at the Supreme Court, guess how that one’s going to turn out.
So, it may be that Biden just did something that is awful public policy, that further alienates voters his party badly needed to win back, and that it will all be for nothing in the end.
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Yellow Stripes & Dead Armadillos 
Polls suggest this isn’t the political albatross you suggest. Also, there are numerous examples of publicly funded programs (paid for by everyone) that benefit only a certain group. Imagine for argument sake that we don’t have a public school system in this country. Someone proposes that we establish a system of public schools which is funded by taxing property. EVERYONE’S property, regardless of the number of children you have who will attend those schools. Loan forgiveness, like public education, has broader implications than just helping those directly involved in the program.
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I can’t agree. Polling shows that only 59% of even 18 to 29 year olds supports loan forgiveness. More to the point, the issue doesn’t show up at all when these young people are asked an open ended question about their biggest issues. This is a boutique issue for a small, vocal activist group. I also can’t buy the comparison to public schools. There is a clear societal benefit in K-12 education. The benefits of a college degree accrue mostly to the individual who will make about twice as much as somebody who didn’t get a degree.
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Agree on societal benefit of K-12 (maybe not so much as it exists today) and I will never have kids.
I’m very irritated that the source of the higher tuition problem – unlimited government student loans – is not being addressed.
Politically it may do absolutely nothing.
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You’re on the right track when you say that this doesn’t address the underlying problem, which is the cost of higher ed. The higher ed system is the culprit that needs to be brought to heel. The debt they burden their graduates with significantly reduces the benefit of college and diminishes the income gap between college grads and non-college grads that you refer to.
But you’re on the wrong track when you describe debt-burdened people as “irresponsible or careless” or comparing them to older people who paid off their debts. The typical 18-year-old who takes out loans to go to UW is doing exactly what society tells them is the most responsible thing to do to achieve future success. And they’re being burdened with a debt that is far, far greater than what was imposed on your generation. And why is that? Partially it’s because universities spend much more on administration and amenities than ever before, but it’s also because state governments made a conscious choice to shift the burden of funding state universities from the public to the individual. So taxpayers absolutely footed a large portion of the costs of your college education; they just did it upfront.
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I agree about administration and amenities driving up costs. But the amenities are just a market response to what students demand these days. Also, I wasn’t just referring to my own generation with regard to paying back debt. The vast majority of today’s borrowers also paid back or are paying back their debts. Finally, we need to rethink this notion that everybody should go to college. We need people in the trades.
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I don’t think UW students “demand” fancy amenities. In fact, in my senior year (2010), students overwhelmingly voted down an effort pushed by the administration to hike fees to fund a new gym. The opposition campaign was led by the TA union.
What has happened is that schools like UW, even though they serve mostly in-state students, view themselves as competing with other elite state schools and private schools for out-of-state students who generate more money.
I agree not everyone needs to go to college. But this isn’t just about the trades. It’s that college has become an expectation for many jobs that didn’t used to require college degrees, including many white collar jobs. You need employers to be willing to hire people without degrees. Local governments, by the way, should lead the way and drop college requirements for many jobs.
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Absolutely agree on that last point, Jack.
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Not just trades. No overwhelming reason for software developers to go to college.
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Eh the narrow focus of the relief package means I doubt we will even be talking about this in a week. The internet will move on like it always does.
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I hope you’re right, Tom. But I think this one really gets people going on both sides of the issue. When I write about it, it gets more strong reactions than anything else — even abortion.
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This seems like a classic case of internet angry to me, intense, brief, and ultimately forgotten.
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