Biden’s Student Loan Forgiveness Plan Is Set to Cost American Taxpayers a Staggering $559B

The president’s cancellation plans will bring relief to many Americans but it’s accruing criticism from the opposite side of the political corridor. Now let’s study the plan.

Households earning more than $300,000 in annual income will benefit the most. 

Accroding to the study, “The main reason for this high average household income is that the SAVE plan already provides long-term debt relief to households with lower incomes.”

This figure is outside the previous figure the Budget Model previously estimated for President Biden’s SAVE plan ($475 billion.)  The total of the new plans and SAVE plan amounts to $559 billion.

At the time, this accounted for around $153 billion in total debt forgiveness.

“As long as there are people with overwhelming student loan debt competing with basic needs such as food and healthcare, we will remain relentless in our pursuit to bring relief to millions across the country.”

It’s an income-driven repayment scheme in which many borrowers are eligible for $0 payments if they earn less than the federal poverty limit.

 Forgiveness was even granted to borrowers who’d been paying for at least ten years with an original loan of $12,000 or less.

The relief comes for about 750,000 households making over $312,000 in average household income.

It already provides long-term debt relief to households with lower incomes and will allow Americans to put more money into savings. 

Plus, it should be noted that the Budget Model doesn’t count Biden’s April 12th announcement that he would cancel $7.4 billion in student debt for 277,000 additional borrowers.

The cancellation also applies for those with graduate student debt that first entered repayment 25 or more years ago.

House Budget Committee Chairmen Jodey Arrington (R-Texas) already fired a shot, arguing that it’s unconstitutional. Arrington also accused the move as the president’s “quest to buy votes.” 

”In reality, his plan will shift the responsibility of paying for loans owed by high-income earners who freely incurred them onto the backs of all taxpayers, many of whom do not even have a college degree.” 

“[Biden’s] administration is dead set on circumventing the Supreme Court, defying Congress, and saddling our country with more debt,” he added. 

That earlier plan, announced in June 2023, would’ve erased a $430 billion debt by more than 40 million borrowers.

Filed in Kansas, the lawsuit is backed, among others, by Texas, Alaska, and Louisiana.

They are fully committed to providing as many Americans as possible with financial relief by canceling student debt.

The 10% who’ve been approved for some debt relief under Biden’s many student loan cancellation programs are grateful.

“We don’t want our loans dictating our life choices and us not being able to do other things because we’re paying so much money. The SAVE plan is definitely a game changer for us.”

Critics, such as House Education and Workforce Committee chairwoman Virginia Foxx, argue the financial burden is simply being shifted. 

Foxx is under the impression that the cancellation of student debt will result in an increase in tax for those without college degrees. 

“But what is absolutely maddening is that the administration is STILL not doing its job and instead focusing on its student loan shenanigans.”