...but Republicans have been against student loan forgiveness for decades, even back when it would have been more advantageous for their voters than for Democrats.
The student loan forgiveness that Biden is doing is somewhere between $440 billion on the low end and $880 billion on the high end (according to how many student loans which are still out there for students who also got Pell grants which would double the amount of loan forgiveness they get).
The current national debt at this moment according to the national debt clock is 30.77 trillion dollars.
The student loans which the government has given out is part of that debt. But that's been okay on many levels because there's been a guaranteed stream of revenue to pay off that portion of the debt and to pay off the interest on that portion of the debt.
The problem that most Republicans have had over the decades with the idea of student debt forgiveness is that the money to pay the national debt still has to come from somewhere. And forgiving the debt means that the money will no longer be coming in to pay it back from the people who borrowed the money.
We're far, far more in debt than we were immediately pre-pandemic. And at that point, we were far, far deeper in debt than we were at the beginning of the Trump administration. And at that point we were far deeper in debt than the beginning of the Obama administration. And at that point we were far deeper in debt than the beginning of the Bush administration. And at that point we were far deeper in debt than the beginning of the Clinton administration.
Now leaving off talking "Republicans and Democrats" and instead talking about non-political reality:
We're now dangerously close to the point of no longer being able to borrow vast new quantities of money at great interest rates...because it's becoming apparent that we're politically unstable, because we have frequent national debates on whether we're going to repay our debt, and because most of the other western countries are up to their eyeballs in their own debt and don't have unlimited extra trillions of dollars to loan to us.
If interest rates on treasury bonds go up to 7-9%, which has been fairly common historically, it'd take almost all the tax revenue coming in yearly just to pay the interest on the existing debt. We've been able to handle doubling and redoubling our debt because we've held interest rates abnormally low in a low inflation environment. But that seems highly unlikely to be the environment we're going to be facing in coming years.
So in that environment, the president has eliminated the revenue stream which would pay back $440-880 billion dollars of debt plus the yearly interest on that debt.
It's not great timing from a financial point of view and sends a terrible message to all the foreign countries which buy our debt, hoping that they'll get repaid with interest. From their point of view we've basically added half a year of US government spending to our deficit totals overnight.
Biden's doing this because he can do it with the stroke of a pen without having to push legislation through Congress, not because it's the absolute best plan to help people. And it does nothing to change the fundamental problem we have in pushing dubious student loans onto people or addressing the cost of college in general.
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