Studies have linked the burden to lower household formation, higher delinquency rates and lower confidence about the future for borrowers.For his part, even while Zandi insists the idea would benefit the middle class, he sees significant weakness.
Researchers Sylvain Catherine, of the University of Pennsylvania's Wharton School of Business, and Constantine Yannelis, from the Booth school, compared the benefits of forgiveness against those of income-based payment plans that Zandi mentioned. They found the latter provided better benefit, particularly for lower-income borrowers.
Current IDR plans, as they are known, would have payments pegged at 10%-15% of discretionary income for borrowers with incomes 150% above the poverty line. Any remaining balances would be forgiven after 20-25 years. The provisions mean that low-income debt holders still might end up paying nothing or very little over the lives of their loans.
Following through, "will be transformational and provide a boost to Biden's approval among the borrowers who will benefit, further cementing educated millennials and other post-generation X age cohorts into the Democratic coalition," Beacon Research said in a recent policy note on the issue.But opposition is likely to be substantial, providing an early faceoff for the new president and Republican lawmakers who could still control the Senate.
There also will be general political backlash on moral hazard grounds from those who see folly in rewarding students for racking up huge debts they couldn't afford to colleges who took advantage of government largesse to jack up costs.Government has "allowed universities to go on this crazy trajectory of increasing their costs without any additional benefit to students," said Carol Roth, head of Intercap Merchant Partners.
Remove $1.5 trillion in debt from the back of Americans (along with related tax impact) and you will see a huge spending spree, particularly on housing.
The same people who want this debt clear are the same people who Bitch about “why are taxes so high”
How about a roll-up of college debt, by major? Employment , by major. Bankruptcy, by major. Govt business should announce: In 4 years these fields will .. be most in demand , pay more than others , etc Also, HS could suggest tech schools / trades, rather than 4 yr college.
If 'only the college' could loan the money, not as many would graduate into a job market where 'such a degree' is not useful. There would BE an employer waiting.
Fix the tuitions. You’re treating the symptom not the problem.
Why are REAL EXPERTS not given audience/chance to DEBATE? Why is there no significant rise in world DEATH RATE but lockdowns are in place? Why aren't erroneous decision makers and obvious scheming globalists not behind bars after deliberately crashing WORLD ECONOMY?
What about those parents who sacrificed to pay for their children's educations? How about those students that worked during college to keep their debt low? Forgiving student debt is not a national priority and its impact on the economy would be limited.
Duh
What do we say to decent, hardworking people who sacrificed and saved to pay tuition? How about those that didn’t go to college and accrue debt yet have to subsidize this. JoeBiden doesn’t understand logic. The reasoning is idiotic.
You know, this is the kind of stuff that’s supposed to be reported before an election.
Duh. Anyone with more than a room temperature IQ knows this.
Allow student debt to be included in bankruptcy. That way there are consequences.
One risk it carries is pissing off all the hard-working Americans who don't have useless and stupidly expensive degrees. Try to make we normals pay for this massive leftist pander. See what happens.
Says who? CNBC? Says bankers? Or says economists?
I’ve been saying it all along
BS, being able to afford a house has huge economic benefits!
Shocking policy
My neighbor’s son needs him to cancel his $204 cell phone bill, his $192 Spectrum bill and his $597 auto lease because the $151 student loan bull is not enough.
How about that!
Bad idea.... The millennial generation will not work hard to succeed when others are paying their way....
we are back to they would not let me.
More important is the issue of foreclosures: tenants who can’t pay their rent and landlords who depend on rent for their income, mortgage and property tax payments for the rented property— not to mention repairs and maintenance to keep the property in compliance.
You don’t say!
that is horse shit- people in the lower or middle class spend more of their money than the top percent- it will have the greatest economic impact
This is just a financial institution bailout in disguise. People were pushed into getting loans they can’t pay back so let’s put it on taxpayers bill. Where’s my bailout?
he looks like a joke as wearing two layers of masks,
And is stupid...and racist, and classist, and sexist, and completely unnecessary, totally irresponsible and oh yeah. Will never happen.
The only risk is not doing it.
Risks? What risks?
Says the loan sharks who have been exploiting student loans to make astronomical & in humane profits. You folks can go hug an electric fence.
no kidding
A one time Band-Aid, while nice, does nothing to change the pricing system of higher education. And let's see what he does for American workers. Let's see if Biden abandons them.
This is not about short-term economics. This is about giving people a fair shot to follow the American dream. These entrepreneurs & working people will lift themselves and their families up. And they will succeed and as a result, so will we all.
Supply of Real Estate. Over regulate d Government control keep supply down. With technology and work from home many people can now move to less expensive zipcodes. Education is also being transformed online which should reduce cost.
If debt forgiveness is not beneficial, then why do we allow people like Trump to have their debts wiped out by filing for bankruptcy?
Same risk as Trump tax break? What’s more important to the working people?
Agree or Disagree with loan forgiveness? The real question is whats with the continued lies from the Government that inflation is under control? Supply and Demand in Education and Real Estate have driven these two basic products unaffordable. Government and industry control the
I also think he believes ten years later we will forgive their mortgage
LOL, no Republican has been able to answer this question: “If people stopped spending, started saving, and invested their money, then who would be left to buy all these things that make a thriving economy?” Thats because all of those people in Debt are the economy.
I’m $348,000 in student loans. debt. I have a Masters Degree in Gender Studies from the Inter Galactic Online Academy. Why can’t I find a good job with a six figure salary? Must be discrimination.
This is so odd. So people take on debt and tax payers bail them out, Wall Street take on debt, and tax payers bail them out, and those suckers who spent a lifetime working and paying off their debts watched their businesses fail when government forced them to shut. Not OK.
Incorrect. That capital will boost the economy
What could possibly go wrong?
LIES!!!! That extra debt removed from household budgets will allow ppl to spend more money and boost the economy in every industry!
NO SHIT ?
JUST SIMPLY FORGIVE ANY/ALL “INTEREST” ON LOANS - USA CANT SIMPLY GIVEAWAY MONIES - DOESNT EXACTLY TEACH RESPONSIBILITY- AND ADDS TO AN EVER INCREASING/UNSUSTAINABLE “DEBT” ❗️
It will never pass.
Mortgages next since we’re just printing money?
Again,work on our economy. We need jobs available for these graduates. We paid for school it was hard we sacrificed, no new cars kept the smaller home......don’t go to overpriced schools take advantage of community colleges most states offer two years free for good grades
So what happens if we just continue life as usual? We already know what the answer is in that regard.
Reduce cc interest rate to 0... people have been using high rate cc to get by during this pandemic.
POS media
Stop..risks? Every time my taxes are used to bail out banks, wallstreet, million dollar business Covid forgiveable loans
A great way to piss of everybody that paid off their loans. Which is actually the majority of people.
What...did you get that from the couple economists that disagreed with everyone else?
Easier to start with 0% interest loans right? Huge benefit to the borrowers and limited impact on the tax payers.
He should start with caregivers to 100% disabled vets JoeBiden
Excuse me while I go and take out astounding debt the government is about to pay off.
No is president. Finish this
Yea, no kidding. Having the working class pay for their future boss’s educations does nothing but further anger those that are being sold out.
What about those that sacrificed, worked multiple jobs to put themselves and/or their children through college? Those who joined the military to pay for college? Those that delayed and worked to pay? Loans were a choice. Pay them back yourself.
No shit
I never do-signed for their loans. I’ll be dammed if I foot the bill for their debt.
Cancel student debts. Community colleges should be free. Prices for education should be affordable, school superintendents, deans, etc. Shouldn't be making millions in salary, these are some reasons why Americans choose vocational courses over Batchelor of Sciences.
If he's going to go forward with this, it should be very limited. You only qualify if you've been out of college and work for a determined amount of time. There should be a household income limitation to it.
Joe has no plans of doing that. It was all empty promises. You know Joe OBiden. A promise made and never kept.
it would lead to more spending power, home ownership, and a growing local economy
Who would pay for a such forgiveness I don't think this idea is good....
Liars
Everyone should get $10,000 to pay off their debt, not just students.
A 41-year old attorney friend with $197,200 in student loans said if her debt was forgiven she would deploy all of her $1,600/mo. loan payment into the economy & equity markets. Option 2: Reduce the interest rate to 0% to accelerate debt repayment.
Just forgive the credit card debt too... that would boost the economy. Why stop there, honestly, if you believe it’s a good idea, why stop there?
Nooooo, really?
No kidding.....
Hello ladies, this product is for you
Is relief and should be income releated
Transfer of debt from idiots who took too much debt to idiots who didn’t
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