Critics of President Joe Biden’s student loan forgiveness program have quickly condemned it as a move that is set to worsen already record-high inflation. | Wikimedia Commons
Critics of President Joe Biden’s student loan forgiveness program have quickly condemned it as a move that is set to worsen already record-high inflation. | Wikimedia Commons
Critics of President Joe Biden’s student loan forgiveness program have quickly condemned it as a move that is set to worsen record-high inflation.
With national debt already topping $30 trillion, Biden recently announced he will wipe clean up to $20,000 of student loan debt per borrower, while also extending the pause on federal student loan payments through the end of the year. The move comes after Democrats recently passed the Inflation Reduction Act, which The Wall Street Journal's editorial board has blasted as counteractive, branding it "an inflation expansion act" and noting that the plan will reportedly cost about $300 billion this year and even more in the long run.
Overall, the nation’s student debt load currently swells past $1.6 trillion, and some argue Biden’s actions will result in a large portion of his loan relief funds being steered to the nation's top earners. Fox News reported that more than 43 million Americans have federal student debt, with upwards of half owing about $20,000.
“That would cost about $300 billion this year, and $330 billion over 10 years says the Penn Wharton Budget Model,” The Wall Street Journal editorial board wrote. “That’s far more than the $102 billion the Inflation Reduction Act purportedly reduces the deficit over 10 years starting in 2027. About 70% of the loan relief would go to borrowers in the top 60% of income distribution."
With residents in Wisconsin carrying more than $23 billion in student loan debt, Fox News reported Biden’s overall plan calls for borrowers earning less than $125,000 a year to see $10,000 of federal student loan debt canceled, while borrowers who attended college on Pell Grants get up to $20,000 in debt forgiveness. The administration has also extended pandemic-era payment freezes through December.
According to Education Data Initiative, the nation's federal student loan debt tops $1.6 trillion, with federal student loan debt totals averaging $29 billion per state. The Treasury Department reported the nation’s current debt load sits at $30.7 trillion.
In Wisconsin, among the state’s student borrowers, 17.2% owe less than $5,000, and 23.5% owe an average of $28,429.
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