Elizabeth Warren and other progressive Democrats want Joe Biden to cancel trillions in American student debt on the first day of his presidency, insisting that the move would give young men and women a huge head start, salvage a struggling economy, and help the underprivileged. Warren is teaming with Senate Minority Leader Chuck Schumer (D-NY) to push a plan in which Biden could forgive up to $50,000 in student loan debt with a Day One executive order.
While the move is popular – duh – among people with thousands of dollars in student loan debt, education policy experts say that the move will have little effect on the economy and, indeed, will only enable the nation’s richest folks to make a little more money off the government. In remarks to the Washington Free Beacon this week, the experts said that debt forgiveness would “enrich the already privileged in this country while leaving behind, or perhaps even draining from, the neediest.”
“That’s because student-debt holders are on average well-off: More than half of debt is held by the top 40 percent of wage earners,” explained the Free Beacon. “Among Americans ages 25 to 40, half of debt is held by the top 40 percent of asset holders—meaning that the wealthiest young adults also have the most debt.”
The outlet spoke to the Manhattan Institute’s Beth Akers, who said that a college degree can add more than a million dollars to a person’s lifetime earnings – a number that far exceeds the burden of a student loan debt.
“Any way you look at it, the plight of student borrowers with college degrees is surely preferable to the plight of those scraping by on the wages paid to less educated workers,” Akers said. “Yet they’ll have to participate in absorbing the financial toll that comes along with canceling student debt anyway. The reality is that each dollar spent on loan relief is a dollar that is raised in taxes, from a tax base where far less than half of taxpayers have a four-year degree.”
The truth is, as much as the Elizabeth Warrens of the world want to make student loan forgiveness sound like another in a long line of progressive helping hands to the poor and downtrodden, this plan is less about doing the “right thing,” and more about playing politics. Democrats have been winning the college-educated vote since 1990, and this is an obvious attempt to keep it that way. If they have to pay for it with the sweat and taxes of the laborers and working-class folks who are increasingly shifting to the Republican Party, well, they’re just fine with that.