(The Center Square) – President Joe Biden touted the recently passed Cut Inflation Act during a speech on Tuesday, but analysts point to the recent cancellation of student debt as a “compensation” for any reduction in inflation. inflation and federal debt.

Biden, joined by Vice President Kamala Harris, praised the bill’s spending, pointing to deficit reductions in the legislation and overall since the peak of relief spending in the COVID era.

“So I don’t want to hear about big-spending Democrats anymore,” he said. “We spend, but we pay.

A recent analysis by the Committee for a Responsible Federal Budget, however, found that the cost to taxpayers of writing off $10,000 to $20,000 per borrower in student debt will more than offset the debt and inflationary IRA benefits. .

The Congressional Budget Office said the IRA would reduce the deficit by $238 billion over the next decade.

But the CRFB estimates that canceling Biden’s debt will cost taxpayers more than double that amount, offsetting those gains by two.

“The student debt cancellation and relief measures recently announced by the Biden administration will cost approximately $500 billion over ten years according to our estimates, wiping out more than twice the $238 billion deficit reduction over ten years of the Inflation Reduction Act (IRA). “, the group said. “In total, we estimate that the student debt proposals will cost as much as the first 16 years of IRA deficit reduction on a nominal basis and the first 21 years of deficit reduction on a nominal basis. current value.”

The group goes on to say that its analysis is likely “generous” in favor of the Biden administration.

“Our estimates may prove to be overly generous, as they are based on our central estimate, do not incorporate a likely increase in lending as a result of the new policies and assume a smooth implementation of the IRA,” said the CRFB. “According to our highest estimate of the student loan plan, it will consume about 18 years of IRA savings on a nominal basis and about 25 years on a present value basis. If the expiring Affordable Care Act grant extensions were extended without offsets in the IRA, the student loan plan could consume more than 25 years of savings on a nominal basis, and it’s unclear if a Such a plan would one day generate enough deficit reduction to fund student debt cancellation on a present value basis.

“Furthermore, as we have previously pointed out, the inflationary effects of the new student debt plan will far outweigh the disinflationary effects of the IRA,” the group added.