OP has a point though. Where did the money come from to lend in the first place? Poof, magic money creation.

Also, the government doesn't pay the interest, they guarantee the loan. At default, *maybe* a partial principle payment would be made to the bank, but they're not gonna pay the amortized loan interest payments.

And how would the poor be transferring wealth to the middle class, when they have a net negative tax revenue stream to the Treasury due to low income tax credits? They pay no tax.