- New plans are the next step in the regulatory process that started last year
- Borrowers could see up to $20,000 in unpaid student loan interest erased
- Republicans blasted the proposals as unfair and accused Biden of trying to ‘buy votes’ ahead of the 2024 election
Republicans are blasting President Biden’s latest plan to cancel student loan debt for millions of Americans, accusing the president of ‘bribing’ voters ahead of the 2024 election.
The Biden administration unveiled its latest proposals to forgive as much as $20,000 in debt for some borrowers on Monday after the Supreme Court struck down its original plan last year.
The White House believes that when combined with the efforts already taken to cancel $146 billion for four million borrowers, the latest efforts would impact as many as 30 million borrowers.
‘Once again, President Biden is ignoring the Supreme Court and shamelessly raiding the treasury to transfer billions in student loan debt to taxpayers. He’s using your money to buy votes,’ wrote Republican Senator Tom Cotton on X Monday.
‘The Biden administration is bribing young voters instead of equipping Americans to know the true cost of college,’ said GOP Senator Joni Ernst in a statement.
‘Look no further than the students struggling to find out if they can afford higher education and the Iowa families whose farms count against them thanks to the Biden administration’s fumbled FAFSA rollout,’ she said referring to the new version of the Free Application for Federal Student Aid (FAFSA) which had a disorganized rollout.
Senators Joni Ernst and Tom Cotton were among the many Republicans to blast President Biden’s latest effort to forgive student loan debt for millions
Cotton slams Biden administration for latest student loan forgiveness plan accusing the president of using taxpayer money to ‘buy votes’
Ernst argued instead of focusing on fixing ‘his FAFSA fiasco, he’s resurrecting his billion-dollar bailout.’
Republican Texas Congressman Dan Crenshaw accused Biden of ‘desperately trying to deceive voters with “free stuff” he can’t deliver on.’
‘His original student loan bailout was struck down by the Supreme Court- even some of his smaller student loan giveaways have run into legal obstacles. So why do this now? The timing suggests he hopes the Supreme Court won’t have time to reject his plan before its term ends- giving voters the illusion that he is delivering for them,’ he posted.
Republican Wisconsin Senate Candidate Eric Hovde also slammed the new effort in an interview on Fox News.
‘Why is it fair for those people that never had the opportunity to go to college now have to pay for those that did? Why is it fair for those people that worked their way through college or their parents worked hard to put their children through college and now have to pay for those that are getting the student debt relief?’ the businessman asked.
Wisconsin GOP Senate candidate Eric Hovde rejects the Biden plans to cancel student debt calling them unfair
Hovde’s remarks from Madison, WI came ahead of Biden traveling to the city to outline his latest student loan plans on Monday.
The new proposals from the president were released nearly a year after Biden’s first plan for widespread student loan debt forgiveness was blocked by the Supreme Court.
After the original plan was struck down, the Biden administration started looking at other ways to cancel debt through the rulemaking process. Monday’s new proposals are the result of those efforts.
‘From day one, my administration has been committed to fixing the broken student loan system and making sure higher education is a ticket to the middle class, not a barrier,’ Biden said in a video posted online Monday.
The Biden administration has canceled $146 billion in student loan debt despite the Supreme Court blocking the president’s first student loan forgiveness plan
The new plans would cancel up to $20,000 in unpaid interest for borrowers who currently owe more on their loans than they originally borrowed.
The interest cancelation would impact single borrowers who earn $120,000 or less and married borrowers who earn $240,000 or less and would be automatically carried out without borrowers having to apply.
The plans would also cancel debt for two million borrowers who would have qualified for other forgiveness programs but have not yet applied.
Additionally, undergraduate borrowers who entered into repayment 20 or more years ago, graduate student borrowers who began repayment 25 or more years ago, borrowers who have been enrolled in low-financial-value programs and those have have faced financial hardship paying back loans would also see relief.
According to the Biden administration, the plans would fully eliminate accrued interest for 23 million borrowers, cancel the full amount of student loan debt for more than four million borrowers and provide more than 10 million borrowers with at least $5,000 in debt relief or more.
The administration will be releasing the plans over the coming months which will then face a public comment period. Senior administration officials said the goal is to start delivering relief this fall.
Last June, the Supreme Court blocked the president’s original $400 billion plan to cancel up to $20,000 in student loan debt for millions of borrowers making less than $125,000 a year.
The Supreme Court ruled that the Biden administration had overstepped its authority with its original plan which relied on the HEROES Act, a law that authorizes the Education Secretary to waive or modify federal student loans due to a national emergency.
Senior administration officials said they studied the Supreme Court’s 2023 decision carefully and pursued the new regulations in a way that is consistent with that decision.
The new plans are being carried out under the Education Secretary’s authority in the Higher Education Act of 1965.
‘This isn’t the same plan, and we feel confident going forward,’ a senior administration official said.
But the president of the Job Creators Network Foundation disagreed saying the administration is ‘lawlessly ignoring the Supreme Court and Congress.’
‘As a policy matter, this bailout suffers from the same fundamental problem as the first one: it does nothing to hold colleges accountable for their role in overcharging students,’ said Elaine Parker in a statement.
Meanwhile, advocates for student debt relief praised the move, calling it ‘one step closer to realizing a life-changing impact’ for millions of borrowers.
Student Borrower Protection Center policy director Aissa Canchola Banez said the move ‘offers a roadmap for how this Administration should deal with a hostile Supreme Court majority captured by right-wing special interests: call the high court’s bluff by aggressively using the full power of the law and delivering for working people.’
Monday’s announcement for additional student loan debt cancelation builds on other efforts the Biden administration has already taken since the first plan was blocked.
To date, the Biden administration has already canceled $146 billion in student loan debt for four million borrowers through changes to multiple programs including the Income Driven Repayment plan and fixing the Public Service Loan Forgiveness program.
Just months after the highest court blocked Biden’s first student debt plan, the administration also launched the Saving on a Valuable Education or SAVE plan.
The SAVE plan is an income drive repayment plan that cuts down on the amount to time and money some borrowers have to pay before their student loan debt is forgiven.
In February, the administration began canceling billions in debt under the SAVE plan including $1.2 billion for 153,000 borrowers.
The White House said more than 7.7 million borrowers have enrolled in the plan and were encouraging millions more to do so.
The Education Department said it would continue to identify borrowers who qualify for their debt to be forgiven on a continuing basis.
As the Biden administration launches its latest student loan forgiveness effort, the SAVE program is already facing a legal challenge.
On March 28, 11 states led by Kansas filed a federal lawsuit in an effort to block the forgiveness program. The lawsuit argued that the effort is no different than the first attempt by the president to wipe out student loan debt which was rejected by the Supreme Court.
Kansas Republican Attorney General Kris Kobach vowed to take the case all the way back to the Supreme Court if necessary.
Along with Kansas, the suit is backed by Alabama, Alaska, Idaho, Iowa, Louisiana, Montana, Nebraska, South Carolina, Texas and Utah.