Big student loan forgiveness plan announced by Biden

The Associated Press ^ | August 24, 2022 | By SEUNG MIN KIM, CHRIS MEGERIAN, COLLIN BINKLEY and ZEKE MILLER

[Oldeconomybuyer]

WASHINGTON (AP) — President Joe Biden on Wednesday announced his long-awaited plan to deliver on a campaign promise to provide $10,000 in student debt cancellation for millions of Americans — and up to $10,000 more for those with the greatest financial need — along with new measures to lower the burden of repayment for their remaining federal student debt.

If his plan survives legal challenges that are almost certain to come, it could offer a windfall to a swath of the nation in the run-up to this fall’s midterm elections.

Proponents say cancellation will narrow the racial wealth gap — Black students are more likely to borrow federal student loans and at higher amounts than others. Four years after earning bachelor’s degrees, Black borrowers owe an average of nearly $25,000 more than their white peers, according to a Brookings Institution study.

Still, the action is unlikely to thrill any of the factions that have been jostling for influence as Biden weighs how much to cancel and for whom.

Some advocates say Biden’s plan still falls short.

“If the rumors are true, we’ve got a problem,” Derrick Johnson, the president of the NAACP, which has aggressively lobbied Biden to take bolder action, said Tuesday.

“President Biden’s decision on student debt cannot become the latest example of a policy that has left Black people — especially Black women — behind,” he said. “This is not how you treat Black voters who turned out in record numbers and provided 90% of their vote to once again save democracy in 2020.”

[caseinpoint]

Those who get forgiveness can expect to meet the new IRS agents if they forget that debt forgiveness is considered income for tax purposes. (Like others I doubt it will actually happen.)

[gcparent]

There was no interest on that loan since March 2020. I would not have had my kid pay it off then esp with all this going on.

[gcparent]

American recovery act student loan forgiveness does not count as federal income thru 2025. How many times do I have to post this?

[miserare]

Hah!

[1Old Pro]

How many questions from the WH press will he take?
1) 6-8
2) a few
3) a lot, for about an hour and the topics were open and ranging from loan forgiveness, to Ukraine funding, to Hunter Biden’s laptop.
4) none

[one guy in new jersey]

Not dischargeable via bankruptcy.

That’s been the hangup all along. Trying to find a way for these particular debtors to remove the jagged hook of loan debt other than by paying the loans back.
.

[Uncle Miltie]

Gay black trans less abled pixies worst hit.

[Dan in Wichita]

Well, I didn't say all working folks, I said many working folks. Some people, like the steelworks you mentioned, are simply a lost cause.

[DoughtyOne]

Have we got a deal for you (re votes)!

[Summertime4359]

Listening to Dan Bongino todY, he was very hot 🔥 or angry about this decision.

[Summertime4359]

This decision pretty much sealed the November 8, 2022 midterms in favor of the conservative MAGA candidates.

[caseinpoint]

First I have heard of that. Does this announcement count as part of the American Recovery Act?

[Mr. K]

"“President Biden’s decision on student debt cannot become the latest example of a policy that has left Black people — especially Black women — behind,” he said. “This is not how you treat Black voters who turned out in record numbers and provided 90% of their vote to once again save democracy in 2020.”"

I said it yesterday, NO ONE is going to be happy by this. The gibmedats especially

[1Old Pro]

until the courts have their say.

Don't count on the GOP to facilitate any legal actions.

[1Old Pro]

Why is Ambassador Susan Rice giving the student loan update at the WH Presser, is she the President? https://www.whitehouse.gov/live/

[RetiredScientist]

Well put. The key is to get people out to vote for Republicans. The problem is the fraction of the electorate that my wife calls the “Gimme Gimme” crowd. These are leaches that try to strip the assets of working people who pay their taxes and want to protect their hard-earned money and spend it as we like.

[Pajamajan]

Great, so people who didn't go to college pay for lawyers exc, who did.

What about those who already paid off their loans?

And, I'm sure they'll also enjoy the 87,000 armed IRS who show up to collect the money from them, to pay off these student's loans.

[Dr. Franklin]

Not dischargeable via bankruptcy.
That’s been the hangup all along. Trying to find a way for these particular debtors to remove the jagged hook of loan debt other than by paying the loans back.

This decision, which may not be legal, 1) forgives debt for most who don't need it, while 2) not solving the problem of those who simply can't pay for whatever reason. It looks like so much PR for the election, which may well be declared illegal by the courts after the election. It's just Slow Joe and the Dems playing politics with a problem they created, but refuse to solve, even when nominally the ruling party.

[FoxInSocks]

Actually, it’s only forgiven to the borrowers. The federal government will print the hundreds of billions of dollars to give to the schools on the taxpayers’ behalf, so it increases money supply and inflation. And it decreases motivation for future students to honestly take out a loan with an intent to pay it back. And it decreases incentive for schools to lower tuition fees.

[politicket]

The federal government will print the hundreds of billions of dollars to give to the schools on the taxpayers’ behalf

The schools have already received the money. The Fed's hold the debt security. This is the same as throwing that security away - it will never be collected, and the money supply will contract, not expand.