Student Debt Forgiveness Is Biden’s Bluto Moment His plan will feed inflation and hurt him politically. By Kimberley Strassel
If political moves received letter grades, Joe Biden’s student loan “forgiveness” mark might rank down there with the Deltas of “Animal House.” Think of it as the president’s Bluto moment.
In case the White House missed it, Democrats had recently been getting it together. After an 18-month food fight over the Biden agenda, the party finally united to pass the Inflation Reduction Act. It suckered spend-happy Republicans into passing a semiconductor bill that vulnerable Democrats could brag about back home. The left has successfully fanned fears on abortion, putting GOP candidates on the back foot. And Donald Trump is in the headlines—right where they want him.
Then along comes Blutarsky, and seven years of college down the drain. It would be hard to fashion a program that carries more political risk for less political reward. In the name of paying off that powerful voting bloc known as “overeducated and underemployed deadbeats,” Mr. Biden is dumping on his own inflation message, dividing his party, and insulting any American who has ever worked, saved or paid a bill.
Inflation remains voters’ biggest worry, and they understand Washington’s role in feeding it. Only recently they watched General Motors and Ford hike the prices of electric vehicles by $6,000 to $8,500—roughly pacing the $7,500 tax credit the Biden “inflation reduction” law bestows. Cause, effect. Millions of American parents read Mr. Biden’s Wednesday loan announcement as news that they will be paying $10,000 more for tuition next year (and the year after that, and after that) as colleges reap the loan windfall.
It won’t stop with college inflation, even Democratic economists warn. Every $20,000 of loan forgiveness is $20,000 the favored college forgiven can blow on urban loft refits or Hawaiian vacations. “Pouring roughly half [a] trillion dollars of gasoline on the inflationary fire that is already burning is reckless,” Jason Furman, the Obama administration’s top economist, tweeted. Americans already doubted Mr. Biden’s new climate and health law would do much to lower prices, but they’ll draw a direct line from the loan bailout to further price hikes. A CNBC poll says nearly 60% of Americans fear this handout will make inflation worse.
The plan rips a new fissure in the Democratic Party, as nonsuicidal members run for cover. Maine Rep. Jared Golden called loan forgiveness “out of touch.” New Hampshire Rep. Chris Pappas said this is “no way to make policy.” Nevada Sen. Catherine Cortez Masto and Colorado Sen. Michael Bennet noted that the plan doesn’t address the underlying problem of rising tuition. Ohio Rep. Tim Ryan, running for the Senate, said the forgiveness “sends the wrong message to the millions of Ohioans without a degree working just as hard to make ends meet.”
What unites these Democrats? Each is in a competitive race, and they clearly already see the potential to alienate large cross-sections of the American electorate. Sure, loan forgiveness may benefit up to 40 million people, and energize Gen Zers and some millennials to vote for the Democrats they were going to support anyway. What about the other 220 million voting-age Americans who are being asked to float the upper crust’s seminars on gender identity and social justice?
Democrats desperately need suburban voters this fall. Those would be the same suburban parents who are already furious over school closures and woke education, who scrimped and saved to pay through the nose for college, and who now look like chumps as they prepare to pay more. The CNBC poll finds that 65% of those 35 to 64—prime college-parent age—feel loans should be forgiven for no one or only for those in need (the Biden plan favors top earners). That share is even higher—78%—for those over 65.
Party leaders have fretted for years over how to handle Democrats’ cratering support among the working class. This is the answer? The loan handout is a thumb in the eye to every American who went to trade school, got an apprenticeship, took out private loans to start a small business, or simply went to work—and now must not only grind out a living and keep up with inflation but cover the poor financial decisions of the college elite.
The media is hastening to explain that a lot of loan forgiveness will flow to minorities, while failing to note how small is the minority of those minorities that actually rack up student debt. According to the U.S. census, only 18% of Hispanics hold bachelor’s or higher degrees. As political scientist Ruy Teixeira wrote recently, the significant recent drop in Hispanic support for Democrats is being “driven by working class voters without a college degree, who make up the overwhelming majority of the Hispanic population.” This will likely hasten their exit from Democratic rolls.
While the “Animal House” Deltas were ultimately expelled, it didn’t harm their futures. Mr. Biden may not be so lucky in his own college shenanigans.
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