WaPo: “Biden’s student loan plan is a regressive, expensive mistake”

OMG: For once, I agree with the Washington Post

The reliably left-lurching Washington Post scorched Biden’s vote-grabbing student loan scheme in an editorial and op-ed.

Editorial   Op-ed

Here are the highlights from the WaPo pieces with interspersed observations from an opinion piece in the left-leaning Daily Beast


What crisis?

In court pleadings regarding Title 42 immigration policies, The Biden Administration declared the COVID pandemic to be over.

The Biden Administration has claimed that “inflation is zero” and that this is the healthiest U.S. economy ever.

In fact, the unemployment rate for people with bachelor’s degrees and higher is just 2%.

So, it’s hard to make the case that college graduates are still facing an unprecedented (financial) crisis.


Is it fair?

Widely canceling student loan debt is regressive.

It takes money from the broader tax base, mostly made up of workers who did not go to college, to subsidize the education debt of people with (supposedly) valuable degrees.

It benefits a relatively small, affluent group of voters.

A minority of Americans have college degrees, they are higher earning and less-often unemployed than their fellow countrymen.

It takes the willingly acquired debt of some and makes it a liability of those who did not take it on … while offering nothing in mortgage relief, car loan relief, credit-card debt relief, or small-business loan relief.

It makes suckers of everyone who recently paid off their college loans or decided not to acquire them in the first place.


At what cost?

Secretary of Education Cordona told CNN that he didn’t know because: “The projections are still coming out.”

But based on think tank estimates, this Executive Action will cost the federal government somewhere between $400 billion and $600 billion, completely unpaid for.

These policies would nullify $305 billion of (dubious) deficit reduction from the Inflation Reduction Act.

According to  Jason Furman, formerly the top economic adviser to President Barack Obama:

“It will pour roughly half [a] trillion dollars of gasoline on the inflationary fire that is already burning,”


Is the Executive Order legal?

It’s doubtful that the 1965 Higher Education Act grants the president the legal authority to take such a sweeping step.

And, as cited above, the Biden Administration itself has already pleaded in Title 42 court arguments that COVID is over.

So, it’s tenuous that the administration can claim that the Administration’s argument that the loan forgiveness is a “pandemic emergency”.


What’s the bottom line?

According to the Washington Post:

“Mr. Biden’s student loan decision will not do enough to help the most vulnerable Americans. It will, however, provide a windfall for those who don’t need it (i.e. the wealthiest Americans and price-gouging universities) — with American taxpayers footing the bill.”


Price gouging universities?

The WSJ cuts to the chase in Biden Bails Out the Price Gougers:

Of course Mr. Biden’s illegal plan to make taxpayers cover student-loan debts will in many cases shower benefits on borrowers who don’t need help.

But the biggest bailout is for the academic wokesters who get paid handsomely to supply products and services for which there is little or no market demand.

Take away the massive system of federal subsidies and there will always be students eager to pay for electrical engineering degrees from Georgia Tech—and private lenders happy to finance an education that is likely to generate earnings power for the borrower. The earnings power comes from the fact that the engineer can make stuff that people want and need.

What cannot exist without government intervention are expensive degrees in ideology and grievance and debt-fueled accumulations of nonmarketable skills.

As we’ve said before: dumb and dumber may have reached the inevitable: dumbest.

Even the Washington Post and the Daily Beast agree!


P.S. It’s worth reading all of the above linked articles in their entirety

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