President Biden on Wednesday announced a student loan handout program that essentially will use taxpayer money to pay off up to $10,000 of student debt per borrower making less than $125,000 per year.
Biden also said he will cancel up to $20,000 for Pell Grant recipients — while extending the pause on federal student loan payments through the end of the year.
A Penn Wharton Budget Model found that a one-time maximum debt forgiveness of $10,000 for borrowers who make less than $125,000 will cost taxpayers around $300 billion — and some economists argue it will spur inflation.
The nation's federal student debt now tops $1.6 trillion after ballooning for years.
The U.S. federal debt is projected to nearly double the size of the economy by 2051, slowing economic growth and raising the risk of a fiscal crisis, the Congressional Budget Office said in late July, as FOX Business reported.
Reacting to news of the student loan handout on Wednesday, Dave Ramsey — personal finance expert, eight-time #1 national best-selling author and host of "The Ramsey Show" — said, "This is so intellectually dishonest."
Dave Ramsey shared thoughts on Wednesday about the student loan handout plan. “This is aggravating,” he said about the program. (Beth Gwinn/Getty Images/iStock / Getty Images)
He added, "If [student loans] are so bad that you have to cancel them, then why are you continuing to make them? You should at least stop making them before we start forgiving them," he added of student debt arrangements.
"It's an obvious political ploy," he also said, addressing his radio audience on Wednesday.
"This is aggravating," he said.
He noted that the student loan industry is "predatory."
Ramsey has been saying for months that the president would likely announce something about student loan cancellation or forgiveness around this time of year.
"I'm guessing there will be some legal challenges to this," Ramsey also said of the Biden handout plan.
For months, Ramsey has been saying that the president would likely announce something about student loan cancellation or forgiveness around this time of year — just ahead of the midterms.
Personal finance expert and author Dave Ramsey said on Wednesday, “We’re also angry on behalf of people who paid off their loans and feel screwed.” (Getty Images)
Ramsey also noted that he didn't think Biden would actually take the step he took on Wednesday.
Ramsey had two other key points to make.
"If you are a $10,000 student loan person and you make less than $125,000, and [your loan] is getting ready to be forgiven — we're happy for you. We want good things for you," he said, referencing the notion of getting out of debt as quickly as possible.
However, he said, "we're also simultaneously angry on behalf of the people who paid off their loans and feel screwed — and you know why they feel screwed? Because they got screwed. That's why."
Ramsey said he also feels angry because he sees this as "an obvious political ploy, when this presidency, from an economic standpoint, is the greatest failure since Jimmy Carter."
Today’s “economy is not prospering,” said Dave Ramsey on Wednesday, August 24, 2022. (iStock / iStock)
He talked about high gas prices and high food prices.
"The economy is not prospering," he emphasized, "and they just passed the largest spending bill in history, to add to this."
And now, "with the stroke of a pen," the Biden student loan handout "amounts to about $300 billion more debt" for this country, he said.
So, everyone out there "just paid off all of these other people's student loan debt, and your grandkids paid them off."
He said, "This slide toward socialism … is out of control. This is a failed presidency," he said.
He predicted a "Democrat bloodbath" this fall in the midterms.
Ramsey also said of the student loan handout, "What about the guy who takes out a student loan next week? What [is Washington] going to do to help him?"
Referencing 18-year-olds in America who need money for college, he said, exasperated, "You can't buy beer — but you can get $100,000 in debt."
So "those of you who have your loans forgiven, we're happy for you. The rest of you," he added, "we're as pi–ed off as you are."
Fox News Digital's Brooke Singman and Megan Henney contributed reporting to this article.