President Biden and White House officials remain silent about how they plan to pay for the cancelation of between $10,000 to $20,000 in student debt for millions of Americans.
Despite unveiling the policy last week, administration officials have yet to explain how Biden’s student loan handout will be paid for in the long term. Economists say that since the proposal calls for the government to forgive the lending outright, taxpayers are likely on the hook as the principle and interest are piled on top of the nearly $31 trillion in existing U.S. debt.
“If this ends up being added to the national debt, it’s just going to drive up the interest costs needed to not default on that figure,” said Brian Riedl, a senior fellow in economics at the center-right Manhattan Institute. “All of that is eventually going to drive up taxes because at some point you’ll have to figure out a way to pay that debt.”
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