President Joe Biden is heaping another $5 billion onto a $136 billion pile of taxpayer-funded student loan debt forgiveness, as one of his signature 2024 (vote buying) schemes heading into the 2024 election.
Not only has moral hazard been reduced to an academic concept, shouldn’t taxpayer funds be used to bail out poverty-stricken Americans before people with college degrees who signed their names to a contract for non-dischargeable debt? We digress.
Around 74,000 student loan borrowers will now see debt canceled as a result of administrative changes enacted by the US Department of Education in the latest round of relief – including borrowers enrolled in the government’s income-driven repayment and public service loan forgiveness programs, Bloomberg reports.
Each program requires at least a decade of payment or service to be eligible for relief. Mismanaged federal student-loan plans have left some borrowers without promised relief after making payments for as long as 25 years. -Bloomberg
“My administration is able to deliver relief to these borrowers – and millions more – because of fixes we made to broken student loan programs that were preventing borrowers from getting relief they were entitled to under the law,” Biden said in a Friday statement written by other people.
Of those receiving taxpayer-funded assistance, roughly 60% are taxpayer-funded “public servants” – so the snake continues to eat its tail. So, buying votes with voters’ money.
The article states that 43,900 of those getting debt relief are “public servants.” That means (I presume) government workers. So nearly 60% of the 74,000 people whose loans will now be paid off via deficit financing work for government, not private sector. https://t.co/wuNgAU0lyl
— Judy Shelton (@judyshel) January 19, 2024
Biden’s bailout comes as civil rights groups, labor unions, and borrowers’ advocates have pressured his administration to expand the scope of his earlier $400 billion initiative that was struck down by the Supreme Court.
The second bite at the apple is much narrower than the original plan which would have forgiven up to $20,000 in student loans for around 40 million Americans.
Nearly 70 groups, including the AFL-CIO and NAACP, asked Education Secretary Miguel Cardona in a letter Thursday to hold another session in the rulemaking process and to include targeted relief for borrowers who have experienced hardship.
The goal is to allow more young people, people of color and low-income borrowers to be eligible for relief. -Bloomberg
According to the report, Biden’s support has weakened among black, hispanic, and young voters – demographics which have been historically critical for Democrats.