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JOE BIDEN REVERSAL — HE’S CAVING UNDER PRESSURE!




JOE BIDEN REVERSES WHO CAN GET LOAN FORGIVENESS

(RightWing.org) – During the 2020 presidential Democratic primary, several
candidates advocated for reducing or eliminating student debt. Soon after
President Joe Biden was inaugurated on January 20, 2021, some Democrats claimed
he had executive power to cancel up to $50,000. Biden resisted that thinking and
said the new administration would look at canceling $10,000 in federal student
loan debt, which he said he would do during the campaign.

On August 24, the White House released a fact sheet announcing his plan. In one
regard, it was more generous than his campaign promise. Still, not everyone
approved of the idea. On Thursday, September 29, six states sued to stop the
plan. Their logic was the law the administration used to justify loan
forgiveness can’t be applied in such a way. That same day, the Department of
Education (DOE) quietly reversed course on the part of the eligibility
requirement regarding who can participate in the program.


ADMINISTRATION CHANGES WHO QUALIFIES

What does the president’s plan forgive? The initial fact sheet announcement said
those who hold federal student loans would receive $10,000 in forgiveness or
$20,000 if one received a pell grant. In addition, individuals would have to
make less than $125,000 per year or $250,000 if married.



How can Biden do this without a specific act of Congress? On August 23, the
Department of Justice (DOJ) issued an opinion stating the 2003 HEROES Act gave
the Secretary of Education the authority to “reduce or eliminate” a borrower’s
“obligation to repay the principal balance” on federal loans due to the COVID-19
pandemic. There are numerous questions about the law’s legality, as Congress
intended any forgiveness to be in connection with a military operation, war, or
national emergency.

So, does the pandemic, which Biden now says is over, constitute a national
emergency?

On September 29, the administration quietly issued a change to the plan.
Initially, it allowed borrowers who secured education loans through entities
other than the DOE to participate in debt cancellation by rolling them into
Direct Loans. The new rule eliminated the option, and those debts will no longer
qualify for the president’s relief program.


SIX STATES SUE

On the same day the DOE announced the change, Arkansas, Iowa, Kansas, Missouri,
Nebraska, and South Carolina filed a lawsuit in a Missouri federal court. They
argued the HEROES Act is “not a hidden source of authority to cancel student
debt.” Additionally, they stated the decision provides relief for all borrowers
regardless of whether or not they were in a better or worse financial position
or endured financial hardship related to their loans during the pandemic and
does not tailor relief to the effects of the pandemic on borrowers, which the
HEROES Act requires.

The DOE estimated it would cost $379 billion, or $30 billion per year over 10
years. It acknowledged the estimate was based on “highly uncertain assumptions”
about economic conditions and interest rates. The Congressional Budget Office
(CBO) reported the program could cost more than $400 billion over 30 years.

The Federal Student Aid website has more information about the program and what
you may need to know.

Copyright 2022, RightWing.org


sharonf

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