The Biden administration has once again found itself under fire for its decision. This time, Sen. Roy Blunt (R-MO) has targeted the decision to chancel out $10,000 in federal student loan debt for most borrowers.
While speaking on a Sunday appearance of ABC’s “This Week with George Stephanopoulos,” Blunt stated that the unilateral choice to forgive the loan amounts was “monumentally unfair” and also labeled it as “bad economics” and that such a policy would end up forcing the already high inflation even higher.
“I just thought it was monumentally unfair, unfair to people who didn’t go to college because they didn’t think they could afford it,” stated Blunt. “Unfair to people who paid their loans back, unfair to people who got higher education in an area that the government didn’t make loans and just bad economics in addition to that. I think it’s going to have a long-term devastating effect on a student loan program that worked pretty effectively until about ten years ago when the federal government assumed responsibility for that program.”
Pres. Biden’s student loan forgiveness plan is “monumentally unfair,” GOP Sen. Roy Blunt tells @GStephanopoulos.
“Unfair to people who didn't go to college because they didn’t think they could afford it, unfair to people who paid their loans back." https://t.co/pGVP7utaTg pic.twitter.com/Mekh7n2SEr
— This Week (@ThisWeekABC) August 28, 2022
A pair of former economists from the Obama administration criticized the plan heavily via social media earlier this past week. Larry Summers, former Treasury Secretary and National Economic Council director, stated this past Monday that “[s]tudent loan debt relief is spending that raises demand and increases inflation.” This was expanded upon by Jason Furman, the former Obama White House chief economist, stating, “[p]ouring roughly half trillion dollars of gasoline on the inflationary fire that is already burning is reckless.” Furman also claimed that the debt relief could end up spawning more problems by forcing tuition to go up, encouraging further borrowing, and creating expectations about debt forgiveness in the future.
Blunt seemed to agree with them.
“You can’t forgive that much debt and assume people won’t spend the money for other things,” he expressed. “It’s certainly going to take about $24 billion that should have been coming into the federal government every year in payments and make that available for more spending.”
Blunt also stated that the move was likely just a smokescreen used to try and increase voter enthusiasm before the midterm elections while ignoring the expected long-term consequences.
“The administration had been very hesitant to do this and here they are doing it right before the election and I think people know they got their debt forgiven,” he stated. “Other people won’t know the impact that has on them or their taxes between now and Election Day.”
.@GStephanopoulos on Pres. Biden's student loan forgiveness plan: “Most economists who've looked at it say it's not going to increase inflation.”
GOP Sen. Roy Blunt: “Well, if that’s what they’re thinking, most economists are wrong." https://t.co/xEqsTqzvZg pic.twitter.com/lYhDHaaFZ3
— This Week (@ThisWeekABC) August 28, 2022