Fox News White House correspondent Peter Doocy repeatedly pressed White House press secretary Karine Jean-Pierre on the Biden administration’s plan for student loan forgiveness.
President Joe Biden announced his plan to provide $10,000 in student loan forgiveness to those making $125,000 a year or less and up to $20,000 for Pell Grant recipients. When Doocy questioned Jean-Pierre about how the U.S. can afford this, the press secretary said the nation’s federal deficit has and will continue to drop.
“And you might spend $300 to $900 billion extra, so you can do that and not increase the deficit?” Doocy asked.
“Here’s the thing. What we are trying to do here, we are doing this responsibly. You heard directly from the president. This is something that is going to be important for middle class Americans when you think about 90% of the folks who are going to actually benefit from this are making $75,000 or less. And you think about what Republicans did just a couple of years ago, they signed off on a $2 trillion tax cut for the wealthy and did not provide any way to pay for that.”
“Who is paying for this? But you’re talking a lot about how much it might cost or might not cost,” Doocy asked. “Who is paying for this?”
The press secretary touted the work of Democrats in Congress and the Biden administration to reduce the deficit and allow the federal government to provide for the middle class. (RELATED: ‘Party Of The Elites’: Charles Payne Rips Biden Admin On Student Loan Forgiveness, Gas Prices)
“But when you forgive debt, you’re not just disappearing debt, so who is paying for this?” Doocy interjected.
Jean-Pierre responded that the Biden administration is handling the student loan debt issue responsibly and promised it will help those who are in need. As Doocy repeated his question, the press secretary said Republicans added to the deficit by passing the Tax Cuts and Jobs Act of 2017 (TCJA).
“I just laid out for you, no, Peter, I just laid out for you how we’re seeing this process and why this matters,” she said. “I just laid out because of the work that we have done in the economy, because of the American Rescue Plan, because of the Inflation Reduction Act, and because of all of this work this president has done, has actually brought down our deficit by $1.7 trillion, unlike what Republicans did when they added to our deficit [by] $2 trillion and did not care at all, or thought about how this was going to be paid for.”
The TCJA added $1 to $2 trillion to the federal deficit, according to the Tax Policy Center.
There have been concerns that the plan to cancel student debt may add to inflation and benefit the wealthy. The non-partisan Committee for Responsible Federal Budget estimated that canceling student loan debt entirely would increase inflation by anywhere from 10 to 50 basis points.
Several Republicans and some economists such as Marc Goldwein, a senior policy director for the Committee for a Responsible Federal Budget, have said the plan could benefit elites by having blue collar and lower income citizens pay more in taxes for those in the upper and higher income brackets.