Biden Struggles To Forgive Predatory Student Loans

How would you like to take out $100,000 in student loans, pay $120,000 in 20 years, and still owe the banks $200,000? The predatory student loan industry in America is breaking the back of many underprivileged young men and women, and it seems that everyone is OK with mortgaging the future of our youth in order to add couple of zeros more to a bank’s balance sheet and to the student loan shark service providers. Meanwhile, President Joe Biden struggles to forgive these predatory student loans at a time of high inflation and lobbyists swarming all over to discourage this unique act of humanity.

No other developed nation on the planet charges its student for higher education the way we do here at home. Not in Denmark, not in Sweden, and not in France, or Britain. The U.S. lawless capitalism is driving the poorest of our citizens towards more poverty and the richest towards more wealth.

This is unsustainable. Something has to break, and something will break. But unlike the financial crisis of 2008, America will have tens of millions of Americans screaming bloody hell in the street of Washington. All that risk to satisfy the greed of the U.S. Government and the banking industry.

There are 46 million student loan borrowers. If this is not a political force to reckon with, then someone needs not to bother and run in 2024.

THE LATEST ANNOUNCEMENT

Secretary of Education Miguel Cardona delivered a statement on August 21 to the effect that the Biden Administration is poised to make an announcement next week about its direction with regard to student loans forgiveness.

Some expect the President to extend the moratorium on payment, now in effect for two years, until after the mid-term elections. This is not likely for the simple reason that more disposable income in the hands of debtor students means more pressure on the economy to contain inflation.

Others expect him to forgive an amount that varies between $10,000 and $50,000 per student. The President himself has repeatedly said he would be willing to forgive $10,000, which is a drop in the bucket for many of the students struggling to choose between paying down their loans or buying a house. Many are marrying late because of the student loans burden on their finances, which means millions of Millennials will die before becoming grandparents.

Very few expect the President to forgive $50,000, which some Democrats, to include Senator Chuck Schumer and the Progressive Caucus, have been advocating for. In our opinion, if he does not follow Senator Schumer’s advice, it would be a grave mistake. There are 46 million student loan borrowers. If this is not a political force to reckon with, then someone needs not to bother and run in 2024.

Some, like the Debt Collective, a student loan union, wants all 100% of student loans canceled. This is very unlikely to happen although it is the right move against predatory loan practices by the banking industry.

If Donald Trump can give away $1.7 Trillion to the rich in tax breaks, Biden can equally give away the same amount in student loans break to 46 million Americans that need it the most.

BIDEN’S OCCAM’S RAZOR

Alternatively, forgiving $50,000 at a time of high inflation might just not be the most prudent action today. With more liquidity in the marketplace, higher inflation might put a damper on everyone’s pocketbook. As a result, this President might kiss the House and the Senate races goodbye.

This is the dilemma facing this administration. A $50,000 loan forgiveness might make inflation worse even though it would ease the pains of tens of millions of Americans. At the same time. $10,000 is too little for the students, but it would put the brakes on inflation as liquidity evaporates. Biden struggles to forgive the amount of student loans. Too much and it would anger the banking industry he needs to win in 2024. Too little and it would anger millions of voters.

Had the President forgiven student loans in the weeks following the legal knowledge he could through Executive Order, he would not be sitting in the middle of this dilemma today. Procrastinating is a bitch..

No matter what Biden does, it is going to have an impact on the people, or businesses, of this nation. Of course, the humanitarian thing to do is accept that the President will lose both Houses in November and forgive all student loans 100% across the board. Worry about 2024 in 2024, but do the right thing for millions of Americans today.

This is Biden’s Occam’s razor. The simplest solution with the fewest parameters to consider.