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Over a dozen Congressional Republicans introduced a measure on Tuesday to repeal the Biden administration’s latest student loan forgiveness efforts that lawmakers argue would transfer over $500 billion of debt onto taxpayers.
After the U.S. Supreme Court struck down President Joe Biden’s massive $430 billion student debt relief plan in June, the administration unveiled an income-driven repayment (IDR) plan that allows borrowers to repay their debt based on income and family size rather than the loan balance itself. After ten years of payments, those with less than $12,000 would have the rest forgiven.
“Once again, Biden’s newest student loan scheme only shifts the burden from those who chose to take out loans to those who decided not to go to college, paid their way, or already responsibly paid off their loans,” Sen. Bill Cassidy (R-LA), the ranking Republican member on the Senate Committee for Health, Education, Labor and Pensions (HELP), said in a news release.
Cassidy, along with 16 Republican colleagues in both chambers of Congress, introduced a Congressional Review Act (CRA) resolution to overturn the “reckless” Saving on a Valuable Education (SAVE) plan that would relieve the principal amount on primarily bachelor’s degree student loans — costing taxpayers as much as $559 billion.
The lawmakers said that under the plan, 91% of new student debt would be eligible for reduced
payments and eventual transfer of $0.50 on every $1 borrowed to taxpayers.
“Our resolution protects the 87% of Americans who don’t have student debt and will be forced to shoulder the burden of the President’s irresponsible and unfair policy,” he added.
According to the Penn Wharton Budget Model, the IDR rule would disperse billions of dollars annually to community college students expecting to have their debt relieved, which lawmakers said would turn the federal student loan financing system into a “poorly targeted, taxpayer-funded grant program.”
Reps. Lisa McClain (R-MI) and Virginia Foxx (R-NC) called the Biden administration’s student loan plan a “scam” and the costliest regulation in U.S. history.
“The only difference between President Biden and a snake oil salesman is a title,” Foxx and McClain said in a statement. “Biden’s administration knows what it’s doing is illegal, but it’s pushing forward anyway, promoting its SAVE scheme as a solution to America’s broken student loan system. In reality, the SAVE scheme is a desperate effort to curry favor and buy votes ahead of the next election.”
Congressional Republicans and Democrats reportedly have criticized the president’s student loan relief efforts. GOP lawmakers said such plans overlook underlying issues that have led to the skyrocketing cost of college and the increasing debt students take on.
It’s unclear if Majority Leader Sen. Chuck Schumer (D-NY) would bring the CRA to the floor for a vote, considering he opposed Republicans’ “cruel” attempt to shut down Biden’s student loan forgiveness program before the nation’s highest court overruled it.
The Biden administration has so far forgiven approximately $116 billion to more than 3.4 million people.
After the Supreme Court blocked the president’s initial student debt relief plan, Biden said he would “stop at nothing to find other ways to deliver relief to hard-working middle-class families.”
Last week, officials canceled $72 million in student loans for about 2,300 student borrowers who attended Ashford University, an online for-profit school based in San Diego that the University of Arizona has since acquired.