Biden is hands down the worst president at least in modern history, if not in the entire history of this country. Lucky for Biden, when we talk about the ENTIRE history we have to include a-holes like Woodrow Wilson and Andrew Jackson but man, he’s right up there.
Making Americans who don’t have student loan debt pay for the debt of other Americans who do.
Wow.
Hey, we get it, Democrats are desperate for something to claim they did for America that wasn’t sucky for the midterms but this is even pissing off people on the Left. The only ones who are happy are the 13% of Americans who have this debt …
The rest of us think this sucks.
Brit Hume shared an interesting thread:
Thread on Biden student loan forgiveness. Note that Furman was head of Barack Obama's council of economic advisers. https://t.co/1sRtk5iN8U
— Brit Hume (@brithume) August 24, 2022
Obama adviser.
Yup.
Check this out.
Pouring roughly half trillion dollars of gasoline on the inflationary fire that is already burning is reckless. Doing it while going well beyond one campaign promise ($10K of student loan relief) and breaking another (all proposals paid for) is even worse.
— Jason Furman (@jasonfurman) August 24, 2022
But gas went down or something, right? Inflation didn’t go up in July?
Democrats keep telling us everything is fine.
Ahem.
The White House fact sheet has sympathetic examples about a construction worker making $38K and a married nurse making $77,000 a year.
But then why design a policy that would provide up to $40,000 to a married couple making $249,000? Why include law and business school students? pic.twitter.com/463YMmCT9g
— Jason Furman (@jasonfurman) August 24, 2022
Because this is about buying votes, not actually helping people.
It’s the Democrat way.
BTW, those examples also contradict the baseline some have concocted to claim that this won't raise inflation. The claim it won't raise inflation is based on the construction worker going from permanently paying $0 interest to paying $31 a month at an annual cost of $372.
— Jason Furman (@jasonfurman) August 24, 2022
Wonder if Biden will blame Putin when inflation goes up again.
You can't use one baseline (interest payments suspended) to argue this will constrain demand & then a different baseline (interest payments restored) to describe the benefits. That is incoherent, inconsistent & indefensible cherry picking–I hope the White House doesn't do it.
— Jason Furman (@jasonfurman) August 24, 2022
They did it.
Maybe Biden didn’t get the memo.
Also need to be careful with all of the distributional numbers because the beneficiaries will tend to have higher lifetime incomes than current incomes. A 24 year-old making $75,000 is likely to be at a relatively high percentile on a lifetime basis.
— Jason Furman (@jasonfurman) August 24, 2022
Just say it, dude. Biden is robbing the poor and giving to the rich.
For votes.
There are a number of other highly problematic impacts including encouraging higher tuition in the future, encouraging more borrowing, creating expectations of future debt forgiveness, and more.
— Jason Furman (@jasonfurman) August 24, 2022
Oh, you can bet your backside colleges will raise tuition after this.
Yay Biden.
Most importantly, everyone else will pay for this either in the form of higher inflation or in higher taxes or lower benefits in the future. I did a thread on this last night but given the new announcement you need to double everything in it. https://t.co/CJ7aPYyAw3
— Jason Furman (@jasonfurman) August 24, 2022
Bad news.
But those votes ain’t gonna buy themselves.
The stimulus is relatively small (a multiplier of ~0.1). So the inflation impact is likely to be about 0.2-0.3pp. That is $150-200 in higher costs for a typical household.
If the stimulus matched what advocates used to argue the inflation would be higher. https://t.co/8MrZ1G1FUM
— Jason Furman (@jasonfurman) August 24, 2022
That is a relatively small inflation number. But would take about 50-75bp on the fed funds rate to extinguish that much inflation. Is the Fed going to try to offset this? Or will it do what it did with the American Rescue Plan and ignore that rapidly changing fiscal landscape?
— Jason Furman (@jasonfurman) August 24, 2022
Finally, it's not obvious to me that this is reasonable for a President to do unilaterally. A number of lawyers (and political leaders) have argued inconsistent with the law. Even if technically legal I don't like this amount of unilateral Presidential power.
— Jason Furman (@jasonfurman) August 24, 2022
When even one of Obama’s lackeys knows this is a bad idea?
You know it’s really really really bad.
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