Democrats dissembled about the costs of their student loan takeover in 2010, and now they’re deceiving Americans about their drive for student debt cancellation. But South Carolina Rep. Jim Clyburn, a member of the House Democratic leadership, gave away the game over the weekend.
Progressives seem to have figured out that sweeping student loan forgiveness isn’t popular with Americans who didn’t go to college or who repaid their loans. Hence they now say that canceling $50,000 per borrower will be a boon for the working class. Sen. Elizabeth Warren says 40% of borrowers with student loan debt never completed college. If she were a company, the Federal Trade Commission could sue her for false advertising.
Progressives also claim that President Biden has legal authority to cancel debt. He doesn’t. But they want him to do it anyway and dare courts to stop him. As Mr. Clyburn explained, “So my whole thing is, use your executive authority and let the courts have at it.” This seems to be the Administration’s guiding legal principle. Do what you want until the courts say it’s illegal. Recall its illegal eviction moratorium and vaccine and mask mandates.
Congress in 2013 slashed interest rates on student debt after Ms. Warren howled that the feds were making money off student loans by charging borrowers higher interest than federal borrowing costs. This was another sham. Lower interest rates merely served as another subsidy for colleges, allowing them to load borrowers with more debt.
Now the feds are losing tens of billions of dollars because many borrowers have taken on so much debt they can’t make even the smaller interest payments. So now Democrats want to bail out the underemployed borrowers they and colleges duped.
To avoid the appearance of helping the affluent, Mr. Biden is considering limiting loan forgiveness to borrowers making up to $150,000 ($300,000 for couples). Yet this would still cover 97% of all borrower debt, including most recent law and medical school grads. The student loan con goes on and on.
