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Who Will Pay For Student Loan Forgiveness Plan?

student loan forgiveness plan
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EDITOR'S NOTE: It’s hard to deny that even for those who believe in responsible fiscal policy, the thought of shaving $10,000 off your student loan debt is pretty tempting. It’s hard to imagine anyone vehemently refusing “forgiveness” on grounds of economic or political ideology. But we have to face reality, and reality dictates that money can’t be created out of thin air and loans can’t be made to disappear without somebody footing the bill. And since the American people are the greatest revenue source for the government, then some segment of the population will end up footing the bill. Note the Biden administration’s spokesperson in the video, and how so awkwardly out of depth she finds herself when confronted with basic economic questions. Aside from this, didn’t Biden just pass the Inflation Reduction Act? So, if student loan holders were to spend close to $10,000 on goods instead of paying their debt, wouldn’t that extra boost in demand also cause consumer prices to rise? Whatever the case may be, read the article and try to guess who, exactly, will end up paying for this deceptive disappearing act. Are the individual benefits greater than the collective economic burden?

President Biden announced a massive student loan forgiveness plan for certain borrowers making less than $125,000 per year as debt continues to climb.

The White House on Wednesday declined to say who will be on the hook for a massive $300 billion student loan forgiveness plan announced by President Biden moments earlier.

During a news briefing, White House Press Secretary Karine Jean-Pierre outlined the benefits of the plan but skirted questions about who will pay for it when asked by Fox News correspondent Peter Doocy.

"When you forgive debt, you're not just disappearing debt, so who is paying for this?" Doocy asked.

Jean-Pierre replied that once the pause on student loan payments is lifted at the end of 2022, the funds will "offset a lot of what we're doing as well."

"When you think about the $4 billion that's going to go back into, as revenue, back into this process as folks paying their college tuition, that matters as well," she said. "We're doing this in a smart way. We're doing this in a way that's going to be effective."

Doocy further pressed Jean-Pierre on who will be on the hook for the tab.

"But somebody's paying for it. Who?" he asked but received no direct answer.

Biden announced Wednesday that he will deliver on a campaign "commitment" to cancel $10,000 of federal student loan debt for certain borrowers making less than $125,000 per year, and up to $20,000 for Pell Grant recipients, while extending the pause on federal student loan payments through the end of the year.

The president said during remarks at the White House that by resuming student loan payments that have been frozen during the COVID pandemic "at the same time as we provided targeted relief," his administration is taking an "economically responsible course."

"As a consequence, about $50 billion a year will start coming back into the Treasury because of the resumption of debt," Biden said, adding that experts "agree that these actions taken together will provide real benefits for families without meaningful effect on inflation."

Fox News' Brooke Singman contributed to this report.

Originally published on Fox News.

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