Tag Archives: Student loan forgiveness

Oct 7 2022

US National Debt Reaches Historic High


Armstrong Economics Blog/Gov’t Incompetence Re-Posted Oct 7, 2022 by Martin Armstrong

The US national debt has reached a historic high under Biden after surpassing $31 trillion. The national debt has always been chaotic as politicians push spending agendas with no plans to pay their debts. The only time the national debt was paid in full was in January 1835 under President Andrew Jackson. The US fell into debt just one year later as a result of the Civil War and Jackson’s war on the banks.

The last time the US experienced a surplus was in 2001, although the debt still increased. COVID spending pushed the nation’s debt to new levels, and the US government spent $3.1 trillion more than it earned. In 2021, the federal government spent $2.8 trillion more than it earned. Now in 2022, the Biden Administration is announcing a new spending plan each week.

Biden spent $1.9 trillion on the American Rescue plan last year, which many blame for fueling inflation as $400 billion was earmarked for Americans to stay home and not work. Biden attempted to pass the $5 trillion Build Back Better bill, the largest proposed bill in US history. When that bill failed, Biden signed the Inflation Reduction Act for $740 billion. Numerous independent studies have stated that the act will only worsen inflation.

Biden plans to spend around $400 billion to cancel student loan debt for families earning as much as $250,000 annually. To add insult to injury, Washington has sent Ukraine nearly $17 billion this year alone. This administration is not worried about taxpaying citizens, and eventually, the citizens will be the ones footing the bill for Biden’s excessive spending.

Sep 30 2022

CBO: Student Loan Forgiveness will Cost $400B Over Next 30 Years


Armstrong Economics Blog/Politics Re-Posted Sep 30, 2022 by Martin Armstrong

The Congressional Budget Office (CBO) is a nonpartisan agency that simply calculates the numbers. The Biden Administration is constantly at odds with the CBO as they repeatedly point out why handouts are never free. Biden’s pre-midterm bribe to cancel student debt will come with a huge price tag — $400 billion.

Borrowers earning under $125,000 annually will receive a $10,000 debt cancelation, while Pell Grant recipients will see a $20,000 reduction. Everyone else will receive a bill in the form of taxes, and even those with loans forgiven will suffer. The CBO calculated the cost of the plan, which will cost $20 billion from September to December 2022 alone. The Biden Administration initially said that the plan would cost $240 billion over the next ten years. Yet, the CBO estimates that the cost of loan cancellation will continue for the next three decades for a total of $400 billion.

Yes, this will cause America’s deficit to rise. Instead of working to lower tuition costs or predatory student lending practices, Biden simply passed along the bill to the taxpayers and pretended the money owed simply vanished. Colleges can simply raise their fees with no repercussions. Glass Stegall has not been reinstated, and those facing bankruptcy cannot erase their student debt.

Glass Stegall was repealed under the Clintons, and even the Clintons’ top financial advisor, Larry Summers, is against Biden’s student loan forgiveness program. “It consumes resources that could be better used helping those who did not, for whatever reason, have the chance to attend college. It will also tend to be inflationary by raising tuitions,” Summers wrote on his Twitter in August. This is simply a gimmick to buy voters who do not understand the repercussions.