Saturday, March 2

Analysis | Biden goes for the safer play on canceling student loan debt

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We’ve finally received word on just what President Biden plans to do in the face of long-standing pressure from his left to cancel student loan debt. And he’s eschewing bold action in favor of what seems to be about the most broadly acceptable option.

As The Post’s Tyler Pager, Danielle Douglas-Gabriel and Jeff Stein report, the White House is planning to cancel $10,000 in debt per borrower, while limiting it to individuals who make less than $150,000 per year or couples who make less than $300,000. The proposal hasn’t been formally announced and apparently will have to wait in the aftermath of the tragedy in Uvalde, Tex. It could also change, as the White House emphasized that no final decisions have been made. But the framework seems to be in place.

That framework is not going to satisfy many liberals who pushed for a much bolder approach with a much higher price tag. Senate Majority Leader Charles E. Schumer (D-N.Y.) and Sens. Bernie Sanders (D-Vt.) and Elizabeth Warren (D-Mass.) were among those pushing for forgiving $50,000 or even all student loans. Nor will this proposal be met with support from Republicans, who have criticized the idea as a handout to a group of Americans already better off than most, since those with college loan debt went to college and thus generally have higher incomes.

But the plan Biden has now apparently settled on does seem as though it meets with significant support among the American people.

Polling student debt is a complicated subject. On the one hand, people like the idea of free money. On the other, the criticisms that this would accrue to the benefit of people who are generally wealthier already are valid. And when you overlay that on to the issue, support declines — as it does when you give them more modest options than canceling all debt or even $50,000.

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Monmouth University back in February polled both the $10,000 and $50,000 options. What it found: 61 percent supported the amount Biden has now zeroed in on, but support dropped to 45 percent on the $50,000 option (which 53 percent opposed). Even 3 in 10 Democrats didn’t want to go up to $50,000.

A Quinnipiac University poll in 2019 found a significantly higher level of support for the $50,000 option, though — apparently in part because the question put a cap on the incomes of those who would receive it. It asked about canceling $50,000, but only for households making less than $250,000 per year. Support in that case was 57-40 in favor — significantly more robust than the Monmouth poll.

This isn’t the only poll to suggest people are wary of canceling student debt for the wealthy. A Grinnell College poll earlier this year gave people three options: canceling all student debt, canceling it only for those in need, and canceling none of it. About two-thirds wanted to cancel at least some people’s debt, but only 27 percent wanted to cancel everyone’s. The “only for those in need” option was the plurality winner at 39 percent.

These polls suggest both that 1) when given the option, people prefer lower dollar amounts and are uncertain about canceling too much debt, and 2) that support rises when you make sure it doesn’t benefit people who are too wealthy. You could make an argument, ala the latter poll, that people might stomach higher amounts with that income cap. But it seems likely $10,000 with an income cap would meet with even broader support than the 57 and 61 percent who supported the $50,000 cancellation in these polls.

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In some ways, the numbers Biden has now landed upon reflect these polls pretty directly, save for the $250,000 number being bumped up to $300,000. (Not that decisions such as this would ever be made based upon poll numbers. Biden also proposed the $10,000 number on the 2020 campaign trail.)

Ultimately, of course, the politics of this are still to be determined. There was a time when Team Biden and even Republicans thought Biden’s child tax credit would be a big political winner, and that didn’t really turn out to be the case.

Perhaps a bunch of people who suddenly see up to $10,000 of student debt canceled so close to the election will be more apt to remember that; an estimated 45 million people have student loans, and more than half owe $20,000 or less, meaning this will be a significant chunk of money for lots of people. And perhaps the lower amount won’t do as much to potentially alienate those opposed to the concept, or who have no higher education and don’t stand to benefit themselves. (There are also the economic impacts of a plan that is estimated to cost potentially in the hundreds of billions of dollars.)

But for now, Biden seems to have gone with the safest option.

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