White House press secretary Karine Jean-Pierre told Said on Thursday night that President Joe Biden’s plan to cancel student loans might cost around $24 billion annually.
She stated on “Don Lemon Tonight” that if 75% of people participate in the President’s student loan forgiveness plan, the annual cost would be $24 billion.
In response to Lemon’s question on whether the White House will provide a precise cost estimate, Jean-Pierre indicated that more information will be provided once it was known how many Americans would take advantage of the plan.
The White House has been at a loss for the second day in a row to respond to inquiries regarding Biden’s plan, stating both that the President waited for the plan to be “fiscally balanced” before releasing it and that the plan’s costs were unknown at this time.
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Jean-Pierre maintained, at a news briefing earlier on Thursday, that the plan to forgive tens of billions of dollars in federal student loan debt for millions of Americans will “be fully paid for because of the work that this President has done with the economy.”
Jean-Pierre, when asked if the administration had a better sense of the program’s total cost, began by asserting that “the President’s record on fiscal responsibility is second to none,” before listing a number of the President’s economic achievements. However, during the briefing, she did not offer any sort of cost estimate for the scheme.
“All of this in terms of cost will also depend on how many of the canceled loans were actually supposed to be repaid, it will depend on how many borrowers actually take up this chance before we get a genuine idea,” she said.
The press secretary was peppered with questions about the data throughout the whole event. When asked if this would increase the deficit, she said the administration did not think so because of “the $1.7 trillion… we’ve done the work right to lower the deficit” (a reference to an administration projection of how much the federal deficit will shrink in fiscal year 2022) and the “$50 billion per year is going to go back” to the Treasury once student loan repayments begin in December.
The Treasury, she said, “was collecting zero for the last two years” since repayments had been halted, but on Wednesday, Deputy Director of the National Economic Council Bharat Ramamurti indicated that debtors were still paying back roughly $2 billion per month, down from $6 billion.
While defending its student debt cancellation plan on Twitter, the White House took aim at Republicans who have had their Paycheck Protection Program loans forgiven for criticizing the initiative.
In response to the Georgia Republican’s criticism of Biden’s plan, the White House tweeted, “Congresswoman Marjorie Taylor Greene had $183,504 in PPP debts cancelled.” For example, one can read, “Congressman Matt Gaetz got $482,321 in PPP debts erased” in response to the Florida representative’s claims of loan forgiveness.
When Republican Representatives Mike Kelly of Pennsylvania, Vern Buchanan of Florida, and Markwayne Mullin and Kevin Hern of Oklahoma were critical, the White House tweeted identical comments.
On Thursday, when asked if the government would give a cost estimate at some point, Jean-Pierre stated, “The Department of Education is going to take the lead.”
In response to why the President took so long to decide to forgive the debt, she cited Vice President Biden “wanted to do it without breaking the bank in the process. As for the legal review, we were anxious to make sure everything was completed.”
When asked how the administration “does not regard this as irresponsible,” Jean-Pierre claimed that there was no need for a public cost estimate or details on how the plan would be paid for or who would pay for it.
According to her, “we do not regard this as reckless.” “In our opinion, this is the most economically sound and fair way to go about things. A lot of folks have asked me why I don’t just settle for $50K. We’d rather not do it because we’re cautious about spending too much money. Again, not everyone can be pleased, but we must ensure that our promise is kept while remaining economically prudent.”
On Wednesday, Ramamurti gave more detail to CNN’s Phil Mattingly about the challenges involved in giving a headline number.
He remarked that estimating costs would be impossible without knowing the participation rate of potential borrowers. “That’s going to be a major factor in the final price tag,” he explained.
Other considerations, he noted, make it difficult to give a precise figure. He noted that the overall sum could be affected by the fact that default rate estimations vary. He continued by saying that helping individuals in need could generate tax income if recipients started businesses or bought homes.