Biden’s Student Debt Scheme Could Cost $1 Trillion Over the Next Decade
According to researchers at the University of Pennsylvania’s Wharton School of Business, Biden’s student debt plan could balloon to over $1 trillion in the next decade if several conditions take place.
The study discovered that the plan would cost $605 billion in the upcoming decade under certain assumptions. However, the total cost in other conditions could swell to over $1 trillion. The researchers argue that this scenario “requires further study.”
Biden announced the student debt plan on August 24, 2022 which annulled thousands of dollars in debt for many borrowers, maintains a pause in payments until the end of 2022, and places monthly caps on payments based on a percentage of borrowers’ incomes.
The most talked about part of the plan cancels up to $10,000 in student debt for individuals making less than $125,000. In a similar vein, Pell Grant recipients under the same income cap can qualify for up to $20,000 in debt cancellation. For families, the income cap increases twofold.
The Wharton researchers discovered that Biden’s student loan proposal will have costs that total between 469 billion and $519 billion over the course of 10 years. According to The Hill, the higher cost figure could become a reality if “future students and students currently enrolled in college with loan deferral status” are included in the Biden debt plan.
The Hill report added that “The researchers noted that future details of the program and behavior changes among borrowers could increase the cost of the proposal to $450 billion or more, which would make the total plan cost over $1 trillion.”
The United States’ system of higher education needs to be dramatically overhauled. The government should obviously get out of the student loan business altogether. Instead, there should be a relaxation of university accreditation standards to allow for more competition to take place. On top of these proposals, state governments should be promoting trade schools and other alternative forms of education where people can build viable skills without having to rack up a lot of debt.
On top of that, elite universities need to be punished. It’s not enough to just defund these institutions, America First nationalists should strive to push for taxes on universities’ endowments to send a message that universities’ financial chicanery will not be tolerated. These are hostile institutions that should be treated as such.