Do you have student loan debt? Are you excited at the prospect of debt forgiveness? Well, President Biden revived the possibility of wiping millions of American student loan debt.
It will cost the administration $321 billion to erase $10,000 of student loan debt per borrower.
President Biden has canceled a fraction of the amount he promised on the campaign trail. Now, he faces pressure from progressives and declining approval ratings. And this week, he proposed the possibility of wiping out $10,000 per borrower. (source)
Biden said, "I am considering dealing with some debt reduction. I am not considering a $50,000 debt reduction. But I'm in the process of taking a hard look at whether or not there will be additional debt forgiveness."
This cancellation would benefit around 11.8 million (31.1%) borrowers. And it would help about 30.5% of delinquents or people in default before the pandemic forbearance. The policy would see the average borrower get $8,478 in student loan relief. (source)
Let's say; the policy had constraints like a household income limit of $75,000. The program cost would drop from $321 billion to $182 billion. The country's national debt is already at a historic high of $30 trillion. Some economists have concerns about putting more money into American wallets. They note that this could worsen already sky-high inflation. (source)
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Disclaimer: This article is only for educational and informational purposes.