mil requiring us to pay her parent plus loan

Hi there, I am new to this forum but have been reading posts on here periodically and have wanted to participate for a while. 

I am looking for outside opinions on how to deal with a new financial setback my husband and I are experiencing.  After we married, my mil informed us that we would now be responsible for paying the debt down on my mil's parent plus loan, in addition to our other student loans.  Technically, parent plus loans are the responsibility of the parent to pay off and they legally can't be transfered to the stuent.  I asked her how much the total balance was, and she informed me it was just under $38,000.  We already have $38,547 in student loan debt along with about $11,000 in credit card debt which would bring our total student debt up to over $76,000 and our total debt about $87,000.  With the new debt, we will use just under half our income on debt, and with our other expenses such as medicine, doctor visits (can be expensive because we dont have insurance), gas, FOOD, etc., we will hardly be able to get by.  The budget I worked out puts us in the red, before we even factor in food.  Anyways, my mil knows our financial situation and says she would pay off her parent plus loan if her husband "allowed her to" but her "hands are tied".  I want to have a baby but with this new financial burden, I truly feel like it would be an irresponsible choice and I wouldnt feel right doing it.  My husband thinks it's our responsibility to pay the debt, which I can appreciate, but at the same time I feel it's really financially irresponsible to take out that particular kind of debt (parent plus loans have super high interest, cant be consolidated, etc) and then expect your just-graduated college student to be able to somehow afford the payments.  Anyhow, I just want to hear some outside perspectives, so I can figure out which of us is being unreasonable and which is the right way to handle this situation.