Just in time for the midterm elections, the Biden administration has announced that millions of college graduates don't have to pay back their student loans.
This week, President Joe Biden announced a plan to cancel up to $10,000 in student debt for individual borrowers making less than $125,000 a year and two-income households making up to $250,000 a year. Pell Grant recipients would be eligible for up to $20,000 in debt cancellation.
This would completely eliminate student loan debt for millions. Yet, some progressives say it still doesn't go far enough and have pushed Biden to cancel up to $50,000 in debt for most borrowers.
Even with an income cap, the vast majority of the benefits of Biden's loan cancellation program will accrue to borrowers in the top 60 percent of the income distribution.
There are other problems too: The one-time plan would increase federal debt by at least $300 billion, and possibly more like $500 billion, effectively wiping out all the expected deficit reduction from the Inflation Reduction Act that Biden signed this month.
Additionally, Biden does not have the legal authority to cancel student debt without congressional authorization. But don't take my word for it: That's what Democratic Speaker of the House Nancy Pelosi said last summer. In her exact words: "The president can't do it—so that's not even a discussion."
Yet, President Biden is doing it.
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