Joe Biden’s millimeter gift to indebted students

Joe Biden’s millimeter gift to indebted students

In politics, this is called a mousehole: a measure cut to the millimeter, capable, with a little luck, of slaloming between critics and turning into success. For Joe Biden, the cancellation of some student debt could well be one of those mouseholes, particularly welcome with less than 11 weeks to go until the midterm elections.

The facts first. On his return from vacation, Wednesday August 24, the American president announced the cancellation of 10,000 dollars of debt for students who had taken out loans, guaranteed by the federal state, in order to pay for their schooling. The amount may reach 20,000 dollars for the beneficiaries of loans reserved for the most modest families. At the same time, the president announced that the moratorium on student loan repayment, introduced at the end of March 2020 due to the pandemic, would expire on December 31. The 45 million Americans who have taken out student loans, averaging $32,000 per person, will then have to start repaying them again.

After months of delay and hesitation, Biden is delivering on a campaign promise, but with a significant caveat. “I’m going to make sure everyone in this generation gets $10,000 off their student debt as we work our way out of this terrible pandemic,” he said in 2020. ultimately, it will not be “everyone”: the cancellation of the debt is reserved for Americans earning less than 125,000 dollars annually (250,000 dollars for a couple). Difficult, with such a ceiling of resources, to accuse the administration of making a gift to the “privileged” who did not need it.

Americans in favor of debt forgiveness

Critics were waiting for Biden at the turn on this file, with diametrically opposed opinions. On the one hand, those who asked him to be much more generous in the cancellation of the debt, claiming that it could reach 50,000 dollars per student. The NAACP (National Association for the Advancement of Colored People), arguing that black students from modest families are particularly indebted, had joined Bernie Sanders and Elizabeth Warren, the two leaders of the Democratic left, in this camp. In front? The Republican Party, but also the Democratic Center and all the Americans who, having repaid their student loans ruby ​​on the nail, saw with a dim view an overly generous debt forgiveness. And in the middle? Average Americans: In February, 77% believed (in an poll) that Biden should cancel some student debt, and among them, 21% of Democratic voters indicated that they would not vote for him, in 2024, if he didn’t.

Student debt in the United States is no mean feat. It amounts to 1.700 billion dollars, more than car credit or debt related to bank cards. And Biden’s “gift” is not trivial: its cost, over 10 years, should amount to more than 300 billion dollars (the real figure is actually lower, some of the borrowers having already made default). It’s not the first move: The administration has already forgiven $32 billion in student debt, and the repayment moratorium has cost the federal government more than $100 billion in lost interest on the debt.

The tide is turning for Biden

The question now is whether this announcement can turn into a weapon of electoral warfare for the November elections. Republicans accuse it of being inflationary, a criticism that many pundits refute, if only because loan repayments will resume in January. The other, more serious uncertainty is knowing how young people will react to this measure. It’s no secret that Joe Biden is hardly popular in their eyes, many finding him too old. This debt forgiveness alone would probably not have been enough to mobilize them. But adding to the fury over the abortion ban, it may spur them to go to the polls.

As always in politics, context matters. For the past few weeks, the tide has turned in favor of the Democrats, and even Biden is benefiting from it: according to a Policito/Morning Consult poll, his approval rating has increased by 4 points in two weeks, while unfavorable opinions have fallen by 4 points. Biden’s “gift” on student debt is no longer that of a president on the ropes, but of a Democratic left that regains hope.


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