Biden’s plan for student loans ‘a costly and unfair election stunt’, says WaPo editorial board

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The Washington Post editorial board said Tuesday that President Biden’s “apparent” plan to cancel student loans “would still be a costly and unfair election stunt.”

The council said the president was right to resist the Democratic Party’s call to eliminate $50,000 in student debt per person, which would help wealthy borrowers who don’t need help.

According to the Washington Post, the president is inclined to waive $10,000 in student loans per borrower. His latest plan would also limit the forgiveness to individual borrowers earning less than $150,000 a year and $300,000 for married couples who file together.

“These provisions, while welcome, would not prevent the policy from becoming another taxpayer-funded subsidy for the upper middle class,” the editorial board wrote.

The Washington Post editorial board on Tuesday criticized President Biden’s plan to cancel student loans. Anna Moneymaker/Getty Images

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The authors noted estimates from the Committee for a Responsible Federal Budget which said the plan could cost $230 billion with more than 70% of the relief affecting those “in the top half of the income scale” while that “a quarter of the benefits would go to the top 20%.”

“Even this does not fully convey how regressive the policy would be, as many recent medical, law and business school graduates would be eligible for pardons even if their lifetime earning trajectories do not warrant it,” have they stated.

President Joe Biden's plan to cancel $10,000 in student loans per borrower has been criticized by the editorial board of The Washington Post.

President Joe Biden’s plan to cancel $10,000 in student loans per borrower has been criticized by the editorial board of The Washington Post.
(AP Photo/Evan Vucci)

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The editorial board authors added that debt cancellation would help many who needed it, but said Biden could be more targeted in his approach and could avoid setting a bad precedent for successive presidents.

“Administration officials stressed that Mr. Biden has not made a final decision and that his goal is to help those most in need. Good. There is still time to change course,” they concluded. .

Biden extended the pause on student loan repayments until the end of August after it was scheduled to expire in May. He said the extension was because the United States was still recovering from COVID-19.

The Washington Post editorial board said Tuesday that Biden's plan for student loans was a

The Washington Post editorial board said Tuesday that Biden’s plan for student loans was a “costly” hit for the election year. ÉRIC BARADAT/AFP via Getty Images

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Several experts have warned that Biden’s plan to cancel student loans will make inflation worse.

“That will produce the most inflation,” former Congressional Budget Office director Douglas Holtz-Eaken said. “If you cancel some of the debt, it will create a little more inflation. The least inflationary thing to do is get people to start paying their bills again. That would take care of that.”

Economist Nicholas Eberstadt said it would be “a hugely regressive transfer to the rich”.

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