Fox News anchor Martha MacCallum and White House economic adviser Jared Bernstein clashed over the administration’s handling of debt surrounding student loan forgiveness.
MacCallum asked the question of who is paying for the $20,000 in student loan forgiveness provided to Pell Grant recipients and $10,000 for borrowers making under $125,000 a year. Bernstein disputed a University of Pennsylvania Wharton model that she cited, which predicted that student loan forgiveness will cost over $1 trillion, claiming the cost will be closer to $24 billion.
MacCallum imagined a scenario where she had $15,000 in credit card debt and she is handed $5,000, she now has $10,000 in debt and does not have extra money to spend. The economic adviser argued the policy will be paid for by the price of the budget deficit being reduced at a significant amount more than the cost of student loan debt.
“So how is that something I can use to pay for furniture for my house? I can’t, that’s not money I have now,” she said.
“The way to think about this is that the government is taking in way more in both receipts and spending way less than we have been in prior years,” he said. (RELATED: Martha MacCallum Spars With Biden Economic Adviser Over Inflation, Student Loans)
MacCallum argued the U.S. continues to have a huge deficit and is spending more than the nation has. The economic adviser said the deficit is being reduced more than the cost of student loan relief.
“The question on that table, I think you’re making this way too confusing,” he said.
“I don’t think so,” she said.
“Okay, well, hold on, and let me suggest how you’re doing so,” he interjected. “The question on the table is is it accurate to say that we are reducing the deficit more than the cost of student loan forgiveness and the answer is unquestionably yes, okay? I hope that’s pretty straight forward.”
“Well you say people can look at money by numbers in a lot of different ways and the Penn Wharton model says it’s gonna cost $1 trillion. So it’s simply not true.”
“Hold on, hold on, I’m not going to let you do the thing where you recast what I said totally differently,” he said. “What I’m saying is very straightforward. We are reducing the budget deficit both in this year and last year far more, multiples more than the cost of student loan debt forgiveness. Very simple, very straightforward fact, so I just want to be sure that’s on the table.”
MacCallum then turned to the legality of the policy, in which Bernstein argued the post-9/11 law, the “HEROES Act,” allows for them to enforce the loan forgiveness. The law was first proposed in 2003 to grant debt relief for military members serving the U.S. in the wake of the 9/11 terrorist attacks. The anchor argued there may be legal challenges to the administration enacting the policy under the post-9/11 law.