One of the things Donald Trump should ask Joe Biden at the CNN Presidential Debate on Thursday is why he won't abide by the law regarding the cancelation of student loans.
Just last night, two U.S. federal district judges — Daniel Crabtree in Kansas and John Ross in Missouri, both appointees of former President Barack Obama — issued injunctions to prevent the Biden administration from canceling any more federal student debt.
In this case, they were blocking the so-called SAVE Plan, which has a price-tag of roughly $475 billion over the next 10 years, according to the Penn Wharton Budget Model.
By the way, that model estimated that 750,000 households making over $312,000 in average household income would benefit.
So much for helping low-income families! Of course, the plaintiffs in this case, which were attorneys general from Missouri and Kansas, succeeded in making the case that Congress never gave President Biden the authority to cancel the loans.
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Now, back to Mr. Trump's hypothetical debate question to Joe Biden: The Biden press office responded to the court decisions by saying they're basically going to ignore it.
"Today’s rulings won’t stop our administration from using every tool available to give students and borrowers the relief they need," said Karine Jean-Pierre, and went on to say, "That’s why the Department of Education will continue to enroll more Americans in SAVE… "
So, I'm sure folks watching the debate will be curious to hear Mr. Biden's answer and even more interested in why he is willing to break the law, or why he is so intent on disrespecting the Supreme Court.
Basically, Biden, who has criticized the supremes in his State of the Union speeches, sees the highest court in the land as just a bunch of Republican justices allied with elected Republican officials out there in the hinterland.
Now, for a guy who talks a lot about "preserving democracy," this is a very odd position to take as he demeans and actually ignores the decision of one of the three branches of government, but never mind, he's going to just try to keep spending almost $600 billion worth of the student loan cancelations, according to the Penn Wharton model.
Federal court decisions be damned, which brings me to another point concerning possible fiscal questions in the CNN Presidential Debate. The latest CBO baseline during the Biden years, which spanned Fiscal Year 2023 to Fiscal Year 2034, shows an increase in federal debt held by the public from $26.2 trillion to $50.7 trillion. As a share of GDP, the debt moves from 97% to 122%.
Now, somebody has got to do something about spiraling federal spending and borrowing before America's finances become completely unmoored from any kind of market-based reality.
That's going to require a bold, balanced budget plan that restrains spending, but holds down tax rates in order to promote revenue-enhancing economic growth, but breaking the law or promoting a complete fiscal breakdown is not the path to a new American prosperity cycle.
This article is adapted from Larry Kudlow’s opening commentary on the June 25, 2024, edition of "Kudlow."
