Biden’s Student Loan Giveaway Will Fuel Inflation Across The Board

You know by now that Joe Biden has made the decision to forgive $10,000 or $20,000 of student loan debt per individual borrower, depending on the particular type of student loan involved. The total costs of this loan forgiveness have been lied about by the White House. Officially, the White House says the cost would be $240 billion spread over ten years. But independent estimates by experts put the cost between $400 billion and $700 billion, depending on the analysis. If we take the middle of that range, a total cost of $550 billion seems like a reasonable estimate. This article contains many more details on this half-trillion-dollar giveaway. There has been a blizzard of commentary about the student loan giveaway. Most of it has asked about people who took out student loans and repaid them in full (that group includes me). Other questions arose about those who paid full tuition without taking out any student loans and obviously made financial sacrifices to do so. Others did not go to college and went straight to work and paid taxes. What about their sacrifices? Still others paid for college by serving in the military for four-year enlistments (or longer) and were able to get tuition assistance because of their military services. All those groups and others made sacrifices either by paying off loans, saving so they didn't need loans, going straight to work and paying taxes or serving in the military. What about them? Why are they now being asked to pay even more taxes to cover the costs of loan forgiveness for doctors, lawyers, and politicians who took out student loans, make good money, and now don't want to pay it back? But there's something far worse in this hare-brained student loan scheme that is simple unfairness to most Americans. The forgiveness itself is like a dollar-for-dollar wealth transfer to those whose loans are being forgiven. Some of them are already planning vacations or big-ticket purchases with their savings. The Biden student loan plan is like another $550 billion of helicopter money dumped into an economy after Biden's $1.9 trillion in COVID relief, $900 billion in new infrastructure spending, and $800 billion in his Green New Scam legislation just passed. That adds up to over $4.1 trillion in new spending on top of $1 trillion baseline budget deficits in just two years. We already know what happened from the earlier spending. We got a recession and the highest inflation in over 40 years. Expect even weaker growth and more inflation as a result of this student loan fiasco.

Jim Richards