The Biden administration is kicking up dust with a fresh plan to cancel student loans for those supposedly grappling with overwhelming medical bills, childcare expenses, and other financial woes. They say it’s all in the name of compassion, but it seems more like a valiant effort to brush off the debt accumulation like an unwanted crumb from a buffet.
This latest move marks President Joe Biden’s third crack at student loan forgiveness, and it looks like he’s got the ol’ “third time’s the charm” mantra on repeat, despite already being turned away by the Supreme Court twice. His first plan went belly-up faster than a lead balloon, while the second is stuck in legal limbo courtesy of a federal judge in Missouri who seems to have a rather unkind view of Biden’s broad interpretations of loan forgiveness. It’s almost like this administration is running a student loan cancellation boot camp: they keep trying new tactics, but they just can’t quite stick the landing.
Biden Proposes Canceling Student Loans For Financial Hardship—Impacting 8 Million. Here’s Who Could Qualify.https://t.co/5LgfKz9nYh pic.twitter.com/9EHK0cerAE
— Forbes (@Forbes) October 25, 2024
The new proposal is packed with hurdles, and whether it’ll clear them before Biden exits stage left in a mere three months remains to be seen. What’s certain, however, is that this plan is ripe for the picking by conservatives who argue that it’s an unconstitutional pandering to the financially unfit. It seems the only people benefiting from Biden’s numerous loan forgiveness attempts are the judges who will undoubtedly have their hands full once again.
Under this proposed rule, the Education Department will have a field day deciding who’s too financially fragile to pay off their loans, estimating that about 8 million Americans could qualify for cancellation. Criteria could include household income, age, and whether those seeking relief can claim to have a pet rock in financial distress. This whole “hardship” evaluation opens a Pandora’s box where practically anyone with a sob story could play the overwhelmed borrower card. After all, who hasn’t had a rough patch where a pizza delivery seemed to escalate into a financial crisis?
Education Secretary Miguel Cardona seems to think bailouts for those who can’t manage their debt magically saves taxpayer dollars by preventing the government from chasing after lost causes. It’s a clever narrative, but it also screams of avoidance—like a parent who doesn’t want to confront their kid over a messy room. Loans are in default if the borrower hasn’t made a payment in about nine months, and with the current climate, estimates indicate around a million people hit that wall every year. Rather than teaching responsibility and lending a guiding hand, the administration is opting to just wipe the slate clean and hope everyone feels better about their financial choices.
As the proposal gears up for a 30-day public comment period, it’s almost comical how the ambitious timeline puts it on a collision course with the upcoming election. Meanwhile, Vice President Kamala Harris remains frustratingly silent about her plans for student debt if she ends up in the top spot. One thing’s for sure, after the Biden administration’s creative accounting and rapid-fire plans, any incoming Republican administration would be left with a real mess to clean up—an economic hangover reminiscent of a bad party, complete with leftover pizza and regret.