Biden: $6.1 Billion In New Student Loan Forgiveness
On Wednesday morning, the Biden White House announced a new massive $6.1 billion student loan forgiveness for nearly 317,000 former students of The Art Institutes, a defunct for-profit college chain. This decision marks one of the largest debt cancellation proposals under the Biden administration, now totaling nearly $160 billion of forgiven student debt.
The Art Institutes, which shuttered last September, were found to have engaged in deceptive practices, misrepresenting job prospects and the value of their educational offerings. This led to the approval of debt relief based on “pervasive and substantial misrepresentations,” according to the Department of Education. Students of the school, which faced a slew of legal challenges and accusations of fraud, will now see their federal student loans wiped clean.
Biden Announces $6.1 Billion Student Loan Relief for Art Institute Attendeeshttps://t.co/Y2b5ePw5eH
— Washington Free Beacon (@FreeBeacon) May 1, 2024
The latest student loan handout coincides with worsening public perceptions of Biden’s economic management, particularly among younger voters. A recent CNN poll shows Biden’s road to reelection is becoming much more difficult as the days pass, with ever-greater numbers of voters finding his administration’s economic policies are failing them. As such, it is becoming apparent that the forgiveness programs are less about correcting injustices and more about wooing a demographic disillusioned by the failure of “Bidenomics.”
Furthermore, focusing on a for-profit institution, which traditionally sees much lower public sympathy, suggests an attempt to sidestep more controversial political landmines while still making headlines. The administration’s use of borrower defense for repayment — a tool established under Obama — underscores ongoing efforts to position Biden as a proactive leader on education reform despite the Supreme Court blocking his broader debt cancellation plans.
While student loan forgiveness generally benefits better-educated workers with higher incomes at the expense of all others, it does little to address the root causes of the student debt crisis, such as skyrocketing tuition costs and the economic viability of degrees. Moreover, focusing on a defunct for-profit college is a safe play that avoids the more systemic issues plaguing higher education in the country, as traditional schools continue to push tuition and costs ever higher, thanks to readily available fully-taxpayer-guaranteed government loans.