Susan Walsh/AP Photo
President Joe Biden speaks in the South Court Auditorium of the White House complex in Washington, April 28, 2022.
I have a new book out this week, titled Going Big, praising Biden for attempting to govern in the sprit of FDR. The book seems more contrarian today than when I began writing it last year, because events largely beyond Biden’s control—COVID, supply chain bottlenecks, Joe Manchin et al.—have stymied his boldest efforts and made him look like a president who can’t govern.
But at least he deserves credit for damning the corporate torpedoes and repositioning the Democrats as progressive champions of working Americans. Or so I wrote.
On student debt relief, however, Joe Biden seems determined to make a liar of me.
Some 43 million young and no-longer-so-young Americans are saddled with almost $1.7 trillion worth of debt. Canceling $50,000 of that debt would be a bold stroke that would make Biden a hero to people whose economic lives are stunted before they begin.
But Biden keeps suspending debt in temporary dribs and drabs, doing a kind of political striptease about permanent debt cancellation. Yesterday, after weeks of leaks, Biden confirmed to a group of reporters at the White House, “I am considering dealing with some debt reduction. I am not considering $50,000 in debt reduction, but I am in the process of taking a hard look at whether or not there will be additional debt forgiveness.”
Say what? Biden has taken an issue that could be a bold winner for him and for tens of millions, and turned it into a waiting game that annoys both his critics and his allies, and makes him less of a hero and more of a piñata.
Contrary to the critics, who caricature debt cancellation as rewarding the rich, most people saddled with student debt are far from wealthy—and the debt makes them poorer. By definition, those from rich families have no debt because their parents pay tuition.
Elizabeth Warren has demonstrated that $50,000 is the right cutoff. Doctors, lawyers, and MBAs typically borrow far more than that, and they would still be on the hook to pay back most of their debt.
The average student debtor carries about $37,000 in debt. The $10,000 cap that Biden has endorsed would relieve only about a quarter of the burden.
Debt payments have been suspended since early in the pandemic. So if Biden ends the general pause of all payments, which expires August 31, and substitutes a cancellation of $10,000 in debt, the average debtor will experience it as an abrupt increase in payments owed.
This would turn a political winner into a big loser. Republicans and deficit hawks would still whack him, and the intended beneficiaries would have no reason for gratitude.
C’mon Joe. Go Big.
