A U.S. judge has blocked Biden's new sweeping student loan forgiveness plan before his administration could even roll it out. What borrowers need to know.
The problem is that declaring the debt gone doesn’t make it gone if the court blocks the executive order. It’s not like they can just hit a button and set all accounts to 0. There isn’t a paper ledger they can toss into a fire.
If we’re getting creative about it and want to use some existing legal authority to take actions that might actually be able to stick, the president does have the near limitless power to order the minting of coinage. As I understand it, he could order the treasury to pump out commemorative student debt coins in denominations ranging from $100 to $50,000, and send them out directly to student loan holders, or maybe to student loan servicers on their behalf. This would carry huge political downsides since printing money to pay for things is pretty well known to lead to inflation, and even if this had no real world effect, the attacks tying the forgiveness to inflation would be relentless and likely persuasive to a lot of voters. But once done, it couldn’t really be undone.
As with so many things, a realistic long term solution will require legislation. If the Democrats take the House and hold the Senate, that’s a possibility. But the current deadlock makes it impossible, because even if a bipartisan solution were to be negotiated, the leadership of the House will not allow anything to go through that might be good for the people or the country, because that could also be good for Democrats.
The problem is that declaring the debt gone doesn’t make it gone if the court blocks the executive order. It’s not like they can just hit a button and set all accounts to 0. There isn’t a paper ledger they can toss into a fire.
If we’re getting creative about it and want to use some existing legal authority to take actions that might actually be able to stick, the president does have the near limitless power to order the minting of coinage. As I understand it, he could order the treasury to pump out commemorative student debt coins in denominations ranging from $100 to $50,000, and send them out directly to student loan holders, or maybe to student loan servicers on their behalf. This would carry huge political downsides since printing money to pay for things is pretty well known to lead to inflation, and even if this had no real world effect, the attacks tying the forgiveness to inflation would be relentless and likely persuasive to a lot of voters. But once done, it couldn’t really be undone.
As with so many things, a realistic long term solution will require legislation. If the Democrats take the House and hold the Senate, that’s a possibility. But the current deadlock makes it impossible, because even if a bipartisan solution were to be negotiated, the leadership of the House will not allow anything to go through that might be good for the people or the country, because that could also be good for Democrats.
Biden can just mint a trillion dollar platinum cost and pay the debt with it.
https://en.m.wikipedia.org/wiki/Trillion-dollar_coin