Biden’s Student Loan “Forgiveness” Wack-A-Mole, version 4.0

The past is prologue when it comes to the student loan policies of progressive grandchildren. Hoping to hear adoring applause one last time, the Biden-Harris administration released a fourth round of student loan debt cancellation legislation on October 25.

First came the massive $430 billion plan that came before the term ends in 2022, making 40 million borrowers’ student loans eligible for cancellation.

He died the following spring in the Supreme Court and was succeeded “Saving on valuable education” plan.which drastically reduced the income borrowers must contribute to repaying their loans at an estimated 10-year cost $475 billion.

WRITE down which two Judges appointed by Democrats ordered in April and then followed four related principles debt relief for borrowers who have spent a long time repaying loans without actually defaulting on their loans.

The latest proposal is another example of the administration’s deep-rooted reflex to respond to its own unpopularity with spending. While the general objections to it are known, it is worth looking at the specific features of the latest plan, especially given their duration.

At this stage, the proposed rules won’t be finalized until 2025. Moreover, their pretense is to provide debt relief to “student loan borrowers for future generations.”

The rules create two new cancellation paths: a one-time automatic cancellation initiated by the Secretary of Education for loans at risk of default, and a permanent option that borrowers can access through an app that “holistically” highlights a borrower’s hardship.

Supposedly, these addresses are not necessarily “sufficiently” included in previous rounds of rulemaking or in readily available loan deferment options. This may be the closest the administration will come to acknowledging redundancy in its plan that layers forgiveness on top of forgiveness.

As with previous efforts, there is considerable dissonance in how the administration presents the rule to different audiences. The Department of Education is announcing these policies publicly as a bold achievement, a power won through a righteous struggle to provide “hope to millions of struggling Americans,” something no other administration has done before.

At least that last sentence is true. But the rules themselves try to speak quietly and modestly to an audience of mostly lawyers, insisting that they are not the product of some strange new authority, but merely a statement of how the secretary intends to exercise the discretion he has always had.

And while the rule is intended to help “millions,” the secretary assures potential critics that he will exercise his discretion only in “relatively rare” situations when “the costs of collecting the full amount of the debt will not be justified by the expected costs of the benefits.”

So rest assured, dear taxpayer, these rules will save you money, despite any appearance that your money is being given away.

Official paternalism works quite well as a description of the content of rules. The administration promises to anticipate and meet borrowers’ needs before they arise, authorizing the Department of Education to automatically cancel loans if the department determines they are at risk of default.

How does faculty make this assessment? By checking a “non-exhaustive” list of 17 factors, of course. How else?

The borrowers the administration hopes to help are apparently so distressed that they haven’t even bothered to apply for aid. Perhaps after years of Covid-19 based transfer payments and the gratuitous benefits of pauses and cancellations on previous loans, borrowers are simply used to receiving without asking.

But then the question is for all of us: Does any other segment of the population receive as much financial support from the federal government?

The most audacious feature of the proposal is not its lenient attitude towards borrowers, but its lack of leniency towards the issue of legal authority.

Since taking office, the Biden-Harris administration has been combing the statutes for a few stray words that could evolve into transformative debt relief authority.

To this day, they are still looking for a justification that would satisfy the judge. But the fact is that they have no credible alternatives, so they repeat the same tortured reading of the Higher Education Act that justified two of the previous attempts.

The courts have already recognized the merits of this argument: Two judges appointed by Democrats discovered that the opponents of these principles are “will probably be substantively successful” their legal challenges. However, this did not in any way discourage the administration from making a fourth attempt, as the administration did not accept this guidance.

As the Biden-Harris administration winds down, its policy approach resembles that of a movie studio that misunderstood its audience and ran out of ideas on how to keep them engaged.

These policies are a continuation that appeals only to the most niche of audiences – the coalition of student debt relief organizations and their supporters within the Department of Education.

For the broader American audience, this approach is fraught with responsibility. Questionnaire conducted by the University of Chicago’s Harris School of Public Policy found that 40% of Americans “strongly disapprove” of the Biden-Harris administration’s repeated plots to shift student debt to taxpayers. Other vote from the libertarian Cato Institute found that about 70% of Americans disagree with student loan forgiveness when told about its impact on taxes and inflation.

Nevertheless, the administration continues to offer the same non-treatment for student debt ailments. Despite the administration’s stated interest in addressing “root causes,” these rules, like their predecessors, barely address, let alone eliminate, the variables that have made higher education such a debt-ridden enterprise, or the variables that make the American economy an economy that, in which makes it difficult for borrowers to repay the debts they have incurred.

Instead, it evokes another version of bourgeois socialism, the redistribution of money to those who have spent too much money to obtain fewer privileges than they would like.