Senator Elizabeth Warren made it crystal clear this past Sunday that she would be incredibly happy to see Old Uncle Joe take a more authoritarian route in these months headed towards to the 2022 midterm elections.
After being a long term advocate for the cancellation of student loans, Warren issued an argument on “Face the Nation” from CBS News that Old Uncle Joe should step up and just cancel the debt by himself instead of trying to push through or wait for an act of Congress.
“I know you believe the president can just erase it essentially through executive orders,” started the show host Margaret Brennan. “But both the White House and Speaker Pelosi have said he may not have the authority, that Congress would have to act here. Have you persuaded the White House otherwise?”
“Look, we know that the president has the authority to cancel student loan debt. And the best way we know that is because Obama did it, President Trump did it, and President Biden has now done it repeatedly,” continued Warren.
“Extending the deadlines, you mean there?” Brennan went on.
“No, no. They have canceled. Remember, they have canceled debt,” restated Warren. “They both canceled it for people in certain categories entirely, but they have also canceled the interest that is due on people’s student loans. They haven’t deferred it; they have canceled it. Because the power of cancellation is already in the statute. President Obama, President Trump, President Biden have all done it. Understand on cancellation, this is something the American people want, and it’s something that tens of millions of people need.”
Brennan pushed back, highlighting that one of the key concerns from voters headed into the midterm elections was the extreme impact of inflation and she then asked Warren if canceling such large amounts of federal debt would worsen inflation.
“No, it is not inflationary,” claimed Warren. “Not paying student loans has been baked in for three years now. But keep in mind, as President Biden himself says, the way we deal with inflation is not by making people poorer. The way we deal with inflation is we attack high prices head-on. Price gouging — we straighten out the supply chains so goods can come into people. We attack it head-on, not by trying to make people poorer. Canceling student loan debt is something that would be good for people all across this country, and, more importantly, good for our economy overall.”
“Not everything has to go through Congress,” stated Warren, once again calling for Biden’s immediate and solo action.
Democrat Senator Elizabeth Warren advocates for Biden to cancel student loan debt by executive fiat: "not everything has to go through Congress" pic.twitter.com/kjOAiFPIXw
— RNC Research (@RNCResearch) April 24, 2022
Going against these claims from Warren, one report from the Commits for a Responsible Federal Budget states that the cancellation of student debt, which equates to about $1.6 trillion, would certainly have inflationary consequences.
“The inflation effect of cancelling $1.6 trillion in student debt would be small relative to the enormous amount involved, since repayments are spread out over time and the benefits of debt cancellation accrue mainly to higher earners, who tend to save more of their money.3 However, the increase is significant relative to the underlying inflation rate. It would represent a 4 to 20 percent increase relative to the Fed’s latest inflation forecast and a 5 to 25 percent increase above its target,” stated the report.
This report also issued the warning that even continuing to extend the payment moratorium for another year would have the exact same effect.