Biden Bails Out More Student Debt Borrowers

The Biden administration’s latest move to forgive $4.5 billion in student loan debt, impacting over 261,000 borrowers, marks yet another example of the President’s commitment to expanding government intervention in the student loan system. This forgiveness primarily targets former students of Ashford University, a largely online for-profit institution, which the Department of Education (DOE) determined engaged in widespread deception regarding the quality of education and the financial burden placed on students.

Ashford University, which operated from 2009 to 2020, was found to have misled students about critical aspects of their education, including the likelihood of obtaining necessary licensure, the transferability of credits, and the cost of attending. These misleading practices ultimately left many students with heavy debts and poor job prospects. According to the DOE, 90% of Ashford’s students never graduated, and those who did were often left struggling with large student loans and limited earning potential.

This loan forgiveness is the result of legal action against Ashford University and its parent company, Zovio, Inc., following investigations that uncovered deceptive recruiting tactics. The debt cancellation adds to the growing total of $34 billion in relief for borrowers whose schools were found to have engaged in fraud or other unlawful practices.

While proponents of the policy may tout it as a victory for struggling students, it raises important questions about government’s role in the student loan market. Critics argue that these debt forgiveness programs encourage a reliance on the federal government instead of addressing the root causes of student loan debt, such as the rising costs of higher education and questionable lending practices.

The Biden administration has stated that this latest forgiveness is part of a broader effort to alleviate the financial burden on millions of borrowers. But for many Republicans, this continued expansion of debt relief raises concerns about its long-term impact on taxpayers and the integrity of the student loan system. The total number of people benefiting from Biden’s student loan forgiveness during his term now exceeds 5 million, highlighting the growing trend of government intervention in personal finance.