America's Talking - Episode 61: Taxpayers to pay billions after Biden administration 'forgives' $10K to $20K in student loan debt per borrower

Episode Date: August 26, 2022

Join The Center Square's Executive Editor Dan McCaleb & D.C. Bureau Chief Casey Harper as they discuss: Feds confirm GDP decreased for two consecutive quarters this year. Biden plan: Taxpayers to pay billions after administration 'forgives' $10K to $20K in student loan debt per borrower. Biden administration uses taxpayer dollars to help grow public unions, critics push back. Support this podcast: https://podcasters.spotify.com/pod/show/america-in-focus/support Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Hello everyone and welcome to the America In Focus podcast powered by the Center Square. America Unfocus is a production of America's Talking Network. I'm Dan McAulb, executive editor of the Center Square Nude Wire Service. Our mission is to fund high-quality public interest journalism that promotes accountability and fiscal responsibility in government. To support great podcasts like this, please donate by clicking the link in the show description. We are recording this podcast on Friday, August 26th. Joining me again today is Casey Harper, the Center's

Square is Washington, D.C. Bureau Chief. How are you, Casey? You're doing good, Dan, are you? I'm doing well. Listen, before we get into this week's news, indulge me for a second. Okay, here we go. I'm not much of a streaming TV person. I've had satellite TV for quite a while now, but I had to get my roof replaced this week, and they had to take my satellite dish down. Of course, DirecTV tells me they can't get out here to reinstall it until late September. So I decided to give Hulu a show. Hulu.

On Hulu, a show called Only Murders in the Building. You familiar? Oh, wow. I'm familiar, but I haven't seen it. Okay. Well, quick background. It stars Steve Martin, Martin Short, and Selena Gomez. They are true crime enthusiasts.

After a man is murdered in their New York apartment building, they decide to produce their own true crime podcast. And after just two episodes, the podcast takes off. So my question to you, Casey, is, should we be doing a true crime podcast? Yeah, Dan, I think we, in a way we are because we are covering the slow murder of the American economy in the last year. Ding, ding, ding, ding. You got the answer right. I was giving you about a 50-50% chance to get that one right.

But that was the answer I was looking for. We're already doing a true crime podcast. Wow, Dan, we're in sync. We're becoming one slowly. I don't know if that's alarming or comforting. That's definitely alarming. Yeah, yeah. Well, speaking of true crime, Casey, I guess depending on your perspective, President Joe Biden this week announced that he was transferring hundreds of billions of dollars in student loan debt to taxpayers. You covered it live from Washington, D.C. Tell us, what's the deal here? Well, to start off, I just want to personally thank you, Dan, for paying off my wife's student loans. So I can send you a thank you card or something.

Are you benefiting it all from this? Or are you just a contributor? I have two college kids. And as up to now, we have not had to take out student loans. I'm not, that's not to say we won't by the time their college careers are over. But I think I got in too late. Yeah. So thanks again for paying off.

Everything I can do to help, Jason. Yeah, yeah. That's new, but great, great to hear. No, I think that, you know, that it's kind of that joke sums. up where a lot of people fall on this, which is, you know, some people are really going to benefit personally from this in a pretty significant way. And some people are totally just going to foot the bill. And how you feel about this might vary widely based on, you know, if your kids are already in college or just about to go to college or if you're a young person who graduated

a few years ago. But just the quick overview of the details of this plan, I think a lot of people heard about it. But Biden announced Wednesday that his administration would cancel $10,000 in student loan debt for those making less than $125,000 a year. If you've got a Pell grant, that number can get up to $20,000 in student loan debt. A less covered part of this actually is that the plan also allows borrowers to cap their repayment at 5% of their income, which is really significant, actually, if you know, lower income, even somebody's, you know, the philosophy major who has 100 grand in debt from Berkeley who's working at Starbucks is going to get a lot more than $10,000 because they're only 5% of their income.

This is what they're going to have to pay opposed to. You hear of student loan payments that are easily $700, $800 a month in that range. So people won't be having to pay as much on their student loan. So these policies, of course, have been really controversial. There's been a lot of rumors and talk about this potential. happening. But here it finally is. And the last thing I'll say about just the details is those who have student loan, federal student loans, don't have to resume repayment until January 1st of this year. So again, in Biden called it one final delay because President Trump did the first delay of payment

on federal student loans during COVID. And then it's been extended several times. I think over half a dozen times. It's been extended by a few months. And so every few months, there's this big buildup of, is the president going to extend COVID relief again? Okay, he did. Okay, he did. But this time, he extended it one final time, did the debt relief. And, you know, I think one of the biggest concerns on this, I want to hear from you on this, Dan, is inflation. But a CNBC, a momentive survey released earlier this week, found that 59% of those surveyed, these Americans said they are concern that forgiving this debt will hike inflation. And the reaction to this on both ends of this spectrum has been interesting to follow.

On the far left, you've got, well, $10,000 a person, and that's not enough. Let's do $50,000 or let's forgive all student debt. On the other side of the spectrum, it's concerns about inflation, concerns about the national debt, which is already nearly $31 trillion. Why should taxpayers, federal taxpayers, and let's be honest here, President Biden calls it student loan forgiveness. It is not, the loans aren't forgiven. It's just taxed. The loans are being transferred from the individuals who signed up to get to receive the money to pay for college to federal taxpayers. As you said, me, you, all of our listeners. And that's not a fair thing is what many folks on the right say.

But let's talk about what this is going to do to inflation, what this is going to do to the national debt. There are plenty of folks that think that this increased government spending will only worsen inflation. Yeah, I mean, what's interesting is, you know, most of the left in by administration has said that this won't increase inflation. And, you know, different economists might disagree. I've seen, you know, even an Obama administration economist Jason Furman, who we covered at the CenterSquare.com, said pretty clearly that this will raise inflation.

But the best kind of argument, if you want to come back at the Biden administration on this, is that when the Biden administration passed the inflation Reduction Act or signed into law and Democrats passed the inflation Reduction Act. They said this will reduce inflation because it reduces or it cuts the deficit by a few hundred billion dollars, right? And so it was like, okay, I mean, you can make the argument for sure. But now that you just raise, you know, you just raise the debt by several hundred billion dollars. So if you want to say that cutting the deficit lowers inflation, then you have to at least admit that spending, you know, debt spending does raise, raise inflation. So just based on the argument that they made when passing the Inflation Reduction Act, it will raise inflation. And as I said, this Obama administration economist has said the same thing.

You know, I think that it's definitely an easy target to attack this. But it's really, I think, the hallmark of a lot of the big government policies and why some people like them is that the government chooses winners and losers. So there's definitely winners in this policy. There's millions of Americans who are going to be better off because of this. but there's many more millions who are going to have to pay for it. And that's kind of the nature of an ever-expanding federal government is that a few people or a group of people are picked as winners by the government and their lives improve while everyone else has to pass to foot the bill.

And this is like a more stark controversial example of that. Well, and let's talk a little bit about the timing of this. Of course, it's midterm elections in less than three months from now. Most analysts, political observers have said this is going to be a tough year for Democrats. Of course, we're experiencing 40-year high inflation. The price of gasoline hit an all-time record high in June. Yes, it has come down a little bit, but it's still significantly more than when President Biden took office. Food prices are, you know, what, 12, 14 percent up year over year.

traditionally going back decades. The party that controls the presidency generally has a tough midterm election year. And then President Biden comes out, while this has been, you know, he's been talking about this for years, even back to when he was campaigning. He waits until two and a half months before the election. Is this a political maneuver to try and gain student debt? O'er's votes? Yeah, I think it definitely was a political mover, a maneuver, and it will have big political implications. But whether it was a good political maneuver, I think remains to be seen. I think a lot

of people are upset about this. There's definitely more people who didn't receive money than did. And you have to imagine that those who benefited most are, you know, recently out of college young people. And the Democratic Party already has the majority of, you know, kind of young millennials voting for them. And so maybe you could say this rewarding their base. But I'm not sure how much reaching across the aisle you're doing with this policy. At the same time, if you give somebody $10,000, you can easily see like, hey, they're a lot more likely to vote for you. I mean, even as his obligation is like, hey, I don't know about all this other stuff, but Biden got me $10,000. So I'm going to go vote for him.

So I'm sure there will be some people who think that way. The question is how many people will be more upset about it? How many people are like, hey, thanks for the money, but that still doesn't change how I feel. The other thing that I've been reading from analysts and political insiders is that they're a little worried that this is going to change the narrative off of abortion. And so a lot of Democrats, the big game plan for the last few months has been, forget the economy. Instead of talking about the economy, we're going to talk about the economy, we're going to talk about. abortion in Roe v. Wade until the cows come home all the way through November and we're going to ride the abortion and, you know, the base, the Democratic basis frustration over what the Supreme

Court did to Roevey Wade. We're going to ride that through the midterms and change the conversation off of the economy because the economy has been such a losing issue for Biden and the Democrats in the last two years. And that strategy, I mean, you could say it was kind of working a lot of ways. But now the student loan thing, it changes the conversation again back to spending, back to inflation, back to numbers and the economic data and the impact of it. And so that's, I wonder if that was kind of a, maybe that's a risk Biden was willing to take or maybe it was kind of an unforeseen consequence politically for Biden. I think the next few weeks, and of course November, we'll see if it was a smart political play or not.

All right. Well, why don't we move on? Casey. You broke a story at the Center Square this week that has many conservatives up in arms. Tell us about the story where the Biden administration is using taxpayer dollars to help public unions grow their ranks, public employee unions. Yeah, this is a really interesting story. You're not going to generally see this anywhere except, of course, thecenter square.com. Dan McKeelah, I'm sure you're a frequent reader. So I am. Good story, Casey. Go for. Hey, oh, thank you.

Stop pathing yourself on the back. And let's talk about yourself. I have a bruise on my back from all the padding that I do on this podcast. But so I'll try to go through not belabor it too long. But there's a federal office called the Office of Personnel Management. It's kind of complicated, but they're sort of like the HR for the federal government, for all agencies. They do all the kind of HR things. And they're definitely a federal agency taxpayer funded.

Everyone that works at OPM, as it's called, Office of Personnel Management, OPM. Everyone that works there is, you know, their salary is paid for by taxpayer dollars. But it turns out that unions, public unions in particular, are extremely grateful and happy for all the work OPM has been doing to help them recruit members. And so being the HR, the federal government, of course, OPM has all the data and the personal information, the database of names of people who work in the government and OPM knows who's in a union and who's not. Yes, OPM knows who's in a union and who's not. And they have this tool called Fedscope, which is like a database of these employees. And they've recently updated it at the specific request of public unions.

They specifically updated it to make it much easier for unions to search and find, you know, where people are in unions and where they're not so that they can recruit them, actively recruit them. And so, dear listener, your tax, your taxpayer dollars were used to pay the salary of federal employees who worked hand in hand with public unions to make it easier for unions to recruit people and get them in their role in their memberships. And of course, that will beef up the budgets of these unions. And if you're a member of a union, you have to pay dues to the union. Yeah, exactly. You have to pay dues. And of course, the political angle, is that unions overwhelmingly support Democratic candidates.

They give different issues, Democratic issues. They rally their members. Biden received like over $27 million from labor organizations in the 2020 election. Trump received, you know, I think less than a million. So there is definitely a political angle of this. The Biden administration helps unions, unions get to Democrats, and it's kind of this circular thing that's going on right now. So what's been the reaction to the, to this in your story?

Yeah, I mean, besides my coming Pulitzer, you mean? Yeah, besides that, we'll talk about that. Maybe never, but go ahead. Maybe never. Wow, man. Okay. You know, I think that a lot of people say this is par for the course. We see this kind of thing happen at the state level, often where, you know,

liberal states, the governors will work to help unions, you know, unions do a good job. of kind of the grassroots level of mobilizing people, of getting, you know, regular people to stay involved, to stay connected to what's going on politically. But talk to some guys at the Freedom Foundation, Max Nelson. And he, you know, he, I'll just read one of his quotes here. He said, helping unions identify organizing targets in the federal workforce, not only enlist taxpayers in promoting private, politically active organization opposed to their interests, but exposes the reality that much union organizing comes from the top down. So, I mean, that's, that's pretty sums up a lot of the reaction to this. Now, on the Democrat side, of course, they'll say, hey,

what's the problem here? Unions are regular, hardworking Americans, and they're happy with us, and we're helping them. And so, you know, this is a special interest that we're happy to help and they don't see much of a problem with it. I think the difference is here is not that a special interest that is being, you know, pleased, it's that taxpayer dollars are being used to actively help a Democrat, you know, leaning group make more money. And then that, and then these Democrat groups use money to support Democratic candidates. That pretty, it's kind of the fall of the money angle that is really makes this interesting story. Right. And as you said at the beginning of this, the segment, unions, public, public employee unions, overwhelmingly.

donate to Democrats over Republicans. All unions. All unions. Yeah, donate to causes on the left. All right. Moving on, new poll this week. Taking a look at Americans' view of the FBI

and the Justice Department after the raid of Mar-a-Lago, Donald Trump's Florida residence. What's the poll show, Jason? Yeah, this is becoming more interesting story because you're good friend, Dan, Marjorie. Taylor Green has been swatted twice, according to her Twitter account. So I don't know if you've been texting her to check in on her, but I know you are close. But the Federal Bureau of Investigation, as you said, has raided Trump's residence. Of course, this was really controversial. It's been

one of the top stories. It's rallied support for Trump. We talked last week on the podcast about how much of the Republican Party had started to move on from Trump or at least been silent on him. And maybe a lot of people were hoping that DeSantis would rise up as a more reliable, more safe, but still a candidate who is able to bridge traditional republicanism with American populism that has become really prominent in the last few years. But after this raid, so many Republicans who have been silent have rallied around Trump, it's caused a surge in his poll numbers. and at the same time, it's caused another change in polls. So this poll from Convention of State Actions, along with the Trafalgar Group, released this week, showed that a large segment of Americans say the raid has decreased their confidence in federal law enforcement. So the poll found that 46.2% of American voters said the DOJ and FBI are too political,

they're corrupt, and not to be trusted. So nearly half Americans say the federal law enforcement is corrupt is pretty amazing. I'm kind of in a sad way, but it's pretty startling. And the poll found that 47.9% of independent voters say the same thing. And so this isn't just like Republicans or Trumpers or something. This is independent voters. Almost half of them are saying the same thing. So it's beyond just kind of an America first thing or like a Republican base at this point.

And this is a really interesting point. 48.7% say that the FBI and DOJ are not telling the truth about their reasons for raiding Trump. So they basically are skeptical of the motives. 50% of independence, half of independents say that the DOJ investigation is just to keep him from running in 2024. So this isn't like half of Republicans think it's a conspiracy. This is half of independence say the DOJ is actively trying to keep Trump from running again. It just shows how much this idea that federal law enforcement has a double standard for Republicans and Democrats has gone from some kind of ultra right wing view to mainstream when you have half-independence saying it.

Interesting. Also on the motive front, there was some news this week about the search warrant that the FBI used to get the warrant to raid Mar-a-Lago. A judge said that the FBI needs to release a redacted version. of the search warrant. So how much is redacted? We don't know yet. But that's set to be released here soon? Today. Today. We're supposed to come out today. Friday.

Maybe by the time our listeners hear this, it will have already come out, but it's expected to come out Friday, not guaranteed. Basically, the DOJ had to submit a redacted version for the judge to approve. Basically, the judge had to approve that it wasn't overly redacted, like unnecessarily, but only what was redacted was what was needed to be redacted. And it seems that the judge has given. to go ahead for a release of the redacted version. Now, whether it's so redacted that it's not useful, we'll be seeing.

I mean, you know, Dan, I'm sure you've seen just in journalism. Sometimes you FOIA for a document or you get some documents, you have to pull teeth to get them, and then you finally get the documents and everything's redacted. Right. A few words. So, you know, we'll see where that lands. But you're right. That is hopefully coming out today.

Look forward to seeing what's in there. Also this week, the Bureau of Economic Analysis released updated second quarter GDP data, which shows that GDP did shrink in the second quarter, which is the second consecutive quarter that essentially the economy shrunk. So are we in a recession or not? Have we been able to answer that question yet? You know, it depends on who you ask and who they voted for, whether we're in a recession. but if you go based off of what pretty much all economists defined a recession as during, let's say, the Trump administration or the Obama administration or the Bush administration or as former President Bill Clinton himself explicitly said on camera a recession was defined, then yes, we are in a recession. Two consecutive quarters of GDP decline has been the definition of a recession. I think that, you know, there's two ways that the Democrats can come, kind of have been trying to combat this. And one is a pretty good argument.

One is not been received as well. The one that's not been received as well is, hey, this isn't actually a real recession, but I don't believe your eyes kind of thing. And they just change, they just say it's not and hope you believe it and hope that kind of the more talking heads and partisan folks on Twitter will just take the message and run with it. the better argument is like, hey, this is not nearly as bad as past recessions. And that's true. You know, this is nothing like some of the recessions we've seen in the last few decades. The GDP growth is pretty, or GDP decline is, you know, not that big. It could be much. And unemployment is doing really well. And so that's a thing they point to a lot is saying, hey, unemployment is not that bad. Now, inflation now is pretty bad. And so that could be a counter to it. But all to say, By the technical definition, yes, we're in a recession, but we've been in worse recessions, and it's unclear how long this one will be.

I mean, it could be that this next quarter, GDP kind of increases again. And, you know, it's kind of a short recession. But if we keep seeing this trend of GDP decline, inflation remains elevated, this whole argument that, hey, this isn't a real recession and looking at an appointment. It's not going to hold water much longer. Thank you for your insight as usual, Casey. But that's all the time we have this week. A reminder to our listeners, you can find all of our great podcasts at America's Topicking.com.

Take a look. Please subscribe. Also, if you like what you hear, you can donate to us by clinking on the link in the show description. For Casey Harper, I'm Dan McKalib. We'll talk to you next week.