A recent report suggests that the implementation of President Joe Biden’s proposal to forgive student debt for certain borrowers could potentially incur a cost of up to $1.4 trillion for taxpayers. The exact amount will depend on the specific implementation of the plans.
According to the nonpartisan Committee for a Responsible Federal Budget, the total cost of all of Biden’s recent debt cancellation efforts is estimated to be between $870 billion and $1.4 trillion.
According to a report from the group, the amount of debt cancellation for student loans under President Biden’s executive actions is more than all federal spending on higher education throughout the nation’s entire history.
According to the group, approximately $620 billion worth of debt cancellation has already been put into effect.
According to the report, our numbers have changed slightly from our previous estimates. This is primarily due to the Supreme Court ruling the President’s plan to cancel $10,000 to $20,000 of student debt per person as illegal. Additionally, the cost of his newest plan remains uncertain.
According to the Committee for a Responsible Federal Budget, their estimated cost for providing universal pre-K and universal affordable child care ranges from $870 billion to $1.4 trillion. This cost is similar to the projected education appropriations for the next decade, which amounts to approximately $935 billion from 2025 to 2034. Specifically, the estimated cost for offering universal pre-K and universal affordable child care is $750 billion.
According to the report, it has been previously explained that the majority of student debt cancellation policies have been both expensive and inflationary. Additionally, these policies have been poorly targeted, going against the goal of reducing college expenses, and lacking financial justification. Instead of persisting with these approaches, lawmakers should collaborate on implementing reforms that genuinely address the issues within the student loan program and tackle the cost and quality of higher education.