TAMPA, Fla. (WFLA) — The Biden administration announced a student loan debt forgiveness plan promising $10,000 in debt cancellation for millions of Americans and $20,000 in debt cancellation for those who received federal Pell grants.
8 On Your Side spoke to University of Tampa Economist, Abby Blanco, about the announcement.
“When I see this type of debt forgiveness, the first things I think about are actually the unintended consequences that may come along with this type of debt forgiveness,” Blanco shared.
The Nation’s Federal student loan debt currently tops $1.6 trillion by 43 million borrowers, according to the Federal Reserve. Blanco fears the forgiveness plan will fall back on taxpayers.
“Debt doesn’t just disappear. Somebody is going to have to pay for these forgiven loans, and that somebody is ultimately going to be the taxpayers,” she said.
“Using those numbers as a basis, the cost to tax payers would be estimated around $330 billion,” Blacno said.