After a break from the briefing room, White House Press Secretary Karine Jean-Pierre returned and faced a barrage of questions about the administration’s plan to cancel billions of dollars in federal student loan debt.
President Joe Biden announced the move on Wednesday to cancel up to $20,000 in debt for borrowers who received Pell Grants, and $10,000 for those who did not — for Americans who earn less than $125,000 a year.
An analysis by the Penn Wharton Budget Model estimates the move could cost the U.S. $300 billion in the first year. Meanwhile, Andrew Lautz, director of federal policy at the National Taxpayers Union, predicts it could cost the average taxpayer at least $2,000.
During a press briefing on Wednesday, Fox News’ Peter Doocy grilled Jean-Pierre about who will be paying for the debt forgiveness.
“About the student loans, how can the country afford such a massive handout?” Doocy asked.
Jean-Pierre responded, “If you look at what this president has done, if you look at the coming end of the fiscal year, $1.7 trillion that we brought down the deficit. That matters.”
“And if you look at the Inflation Reduction Act, it’s going to add another $300 billion going to bring down the deficit again,” she added.
She went on, “We are doing this responsibly. You heard directly from the president this is something that is going to be important for middle-class Americans. When you think about 90 percent of the folks who are going to actually benefit from this are making $75,000 or less, and you think about what Republicans did just a couple of years ago, they signed off on a $2 trillion tax cut for the wealthy and did not provide any way to pay for that.”
Watch the exchange below:
Doocy: "And you might spend $300 billion to $900 billion extra. So, you can do that and not increase the deficit?"
— Curtis Houck (@CurtisHouck) August 24, 2022
KJP: "Here's the thing. What we are trying to do here — we are doing this responsibly. You heard directly from the President[.]" pic.twitter.com/J7c4IAQKDy
Doocy was not satisfied with that answer and asked again, “Who is paying for this?”
“What we are saying is the work that this administration has done, the work that the Democrats and Congress has done, is actually there. And you see that the $1.7 trillion deficit deduction that you see is going to benefit us in being able to do something for the middle class,” the press secretary responded.
Still, the Fox reporter countered, “But when you forgive debt, you’re not just disappearing debt. So who is paying for this?”
“We’re going to lift the pause [on student loan payments] at the end of this year, which is going to matter, right? Which is going to offset a lot of we’re doing as well. When you think about the $4 billion that’s going to go back as revenue back into this process of folks paying their college tuition, that matters as well,” Jean-Pierre added before repeating that it is been done in a “smart way.”
Doocy: "But when you forgive debt, you're not just disappearing debt, so who is paying for it?
— Curtis Houck (@CurtisHouck) August 24, 2022
KJP: "And then I will give you the second part. We have lifted the pause…at the end of this year, which is going to matter…which is going to offset a lot of what we are doing[.]" pic.twitter.com/tT8T4R8g2a
Doocy asked once more, “But someone is paying for it. Who?”
“I just laid out for you…No, Peter, I just laid out for you how we’re seeing this process and why this matters,” Jean-Pierre said.
As Doocy asked whether wealthy Americans or corporations would pay for the plan, Jean-Pierre repeated her previous comments about reducing the deficit.
Finally, she said the administration is “happy to have this conversation” but then moved on to another reporter.
