The Biden administration announced yesterday that it was forgiving $5.8 billion of student-loan debt accumulated by 560,000 borrowers who attended for-profit colleges operated by Corinthian Colleges, which filed for bankruptcy in 2015. The Wall Street Journal calls this “the largest single action of debt cancellation ever by the federal government.” This may be a trial balloon to pave the way for a broader and illegal mass debt forgiveness for student-loan borrowers in general, and perhaps to test the legal grounds (although the legal objections here may be distinct and focus on short-circuiting a pre-existing process for individual relief from fraudulently induced student debt).

The Corinthian borrowers are a more sympathetic class than student-loan borrowers in general, and relieving them of debt also fits comfortably within the general animosity of progressives toward any form of for-profit education. It would not trigger a backlash against the schools that collected the tuition, because the schools are already defunct. Even so, there are many classes of defrauded investors, borrowers, and consumers who do not get compensated by the federal government. And debt forgiveness by the federal government is still the equivalent of printing more money, so it runs in the opposite direction of any effort to tamp down inflation. Don’t be surprised if the Biden White House is carefully watching and managing the response to this initiative — to be formally unveiled today by Vice President Kamala Harris — to prepare the way for something much larger.