August 25, 2022

The Republicans Are Lying (Quite Pathetically) About Student Debt Forgiveness

A bailout of the elite? They must be thinking of their 2017 tax cuts.

Rep. Jim Jordan (R-Ohio), would-be champion of the working class.LM Otero/AP

Get your news from a source that’s not owned and controlled by oligarchs. Sign up for the free Mother Jones Daily.

Those silly congressional Republicans are at it again. Over the past couple of weeks, they’ve unleashed a torrent of misinformation, claiming that $80 billion of new IRS funding included in the recently enacted Inflation Reduction Act would be used to hire 87,000 new agents (many armed!) who would go after middle-class taxpayers. As I pointed out the other day, this isn’t merely dishonest—it’s dangerous.

Now they’re lying about the Biden administration’s plan to cancel $10,000 to $20,000 in student debt for individuals earning less than $125,000 annually ($250,000 for couples). Somehow, the Republicans have interpreted this move as a bailout of rich elites at the expense of good, hard-working people.

It’s interesting that Republicans are so up in arms about a supposed bailout of the “elite” by ordinary folks, given the top-heavy tax cuts they rammed through Congress in 2017. We sure didn’t hear many Republicans complaining about that $800 billion in pandemic loan forgiveness, most of which benefitted the wealthiest 20 percent of Americans. Lawmakers from both parties have ignored the way our vast federal subsidies for retirement savings skew to the top. (Average tax-advantaged savings for the wealthiest 10 percent of households are 125 times that of the least-wealthy 50 percent of households.) 

But Biden’s loan relief won’t look like that. Consider the distribution of student debt: According to the Federal Reserve’s latest (2019) Survey of Consumer Finances, people from the least-wealthy 25 percent of the US population were by far the most likely to have outstanding student debt. They also owed the most of any other group (median: $32,000). Within the wealthiest 10 percent, less than 6 percent of people had student debt, vs. 36 percent of those in that bottom quartile.

In fact, the less wealthy you are, the greater the odds you’ve got student debt. 

Also, per the Fed data, more than 30 percent of Black Americans had outstanding student debt, compared with 20 percent of whites—and the Black debtors owed $5,000 more on average. The Department of Education estimates that 90 percent of the debt relief will go to people making less than $75,000 a year. It would seem this program is a win for Real America, though perhaps Jim Jordan had someone else in mind when he tweeted.

Now, it is true, as Rick Scott tweeted (apparently from his yacht), that federal student loan forgiveness won’t fix the problem of inflated college costs.

But the administration has acknowledged this, and insists it is working to address the problem. 

Another line of Republican criticism is that forgiving debt is unfair to people who came before and were obligated to pay it off… 

But the same could be said of any policy that directly benefits some people and not others. By Kennedy’s logic, tax credits that encourage the purchase of electric cars are unfair to people who bought EV cars without such credits. He could just as easily argue that giving women the vote was unfair because women in the past were denied it. And then there’s this:

In any case, let’s conclude with this hot take from a boisterous young fellow who has never really had to earn a living, and whose family is known for fleecing workers, vendors, consumers, and the federal government.

Don’t just click away.

We need your help. We’re halfway through our Summer Membership Drive, and only $35,000 toward our $200,000 goal. But there’s good news: This week only, every donation will be doubled, up to $50,000, thanks to a generous reader.

That’s twice the impact for intrepid reporting that peels back the layers to publish the truth—and the context you need to break it all down. It’s twice the fuel for investigations on voting rights and justice, critical in this midterm election year. And it’s twice the power for exposing the chaos and corruption of a White House trying to control the narrative.

This is a pivotal moment in our nation, with democracy on the line, and we can only do this work because readers like you step up. Every donation, of any amount, makes a difference here. And every donation will be doubled.

We cannot do this work without you. Join the fight. Double your donation to defend democracy.

Don’t just click away.

We need your help. We’re halfway through our Summer Membership Drive, and only $35,000 toward our $200,000 goal. But there’s good news: This week only, every donation will be doubled, up to $50,000, thanks to a generous reader.

That’s twice the impact for intrepid reporting that peels back the layers to publish the truth—and the context you need to break it all down. It’s twice the fuel for investigations on voting rights and justice, critical in this midterm election year. And it’s twice the power for exposing the chaos and corruption of a White House trying to control the narrative.

This is a pivotal moment in our nation, with democracy on the line, and we can only do this work because readers like you step up. Every donation, of any amount, makes a difference here. And every donation will be doubled.

We cannot do this work without you. Join the fight. Double your donation to defend democracy.

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

INDEPENDENT. BECAUSE OF YOU.

Mother Jones has no billionaires calling the shots—just readers like you making fearless reporting possible

Donate