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The Editors

Forgiving Student Loans Is a Costly Mistake

The best that can be said for President Biden’s debt-relief plan is that it could have been worse.

Who’s footing the bill?

Who’s footing the bill?

Photographer: Photo by Paul Morigi/Getty Images for We, The 45 Million

With Wednesday’s long-awaited announcement forgiving the debts of certain student borrowers, President Joe Biden hopes to give Democrats a boost in this fall’s midterm elections. Whatever the short-term political gains, the decision is a costly mistake — and one that the administration will almost certainly come to regret.

Biden’s plan cancels $10,000 in federal student-loan debt for borrowers with annual incomes of $125,000 or less, or $250,000 for married couples. Students who received Pell Grants, which help low-income families pay for college, will have up to $20,000 forgiven. Biden also extended the freeze on loan repayment for all borrowers through the end of the year — the seventh such extension since the start of the pandemic.