Senate Republicans want to revoke the White House’s plan to forgive some student loans.
A trio of senators on Monday (March 27) introduced a Congressional Review Act (CRA) resolution that would overturn President Joe Biden’s student loan cancellation plan and end the administration’s pause on student loan payments.
The plan was introduced by Sen. Bill Cassidy of Louisiana, Sen. John Cornyn of Texas, and Sen. Joni Ernst of Iowa.
“President Biden is not forgiving debt, he is shifting the burden of student loans off of the borrowers who willingly took on their debt and placing it onto those who chose to not go to college or already fulfilled their commitment to pay off their loans,” Cassidy said.
“It is extremely unfair to punish these Americans, forcing them to pay the bill for these irresponsible and unfair student loan schemes.”
The announcement from the three senators notes that the Government Accountability Office ruled last week that Biden’s plan is classified as a rule and is thus eligible to be overturned under the CRA.
The Biden administration is also waiting on a Supreme Court ruling on the forgiveness plan, following a challenge by a group of Republican attorneys general.
Earlier this year, the administration proposed an income-driven repayment plan designed to ease student loan debt.
The new regulations would amend the terms of the Revised Pay As You Earn (REPAYE) plan to let borrowers who make less than roughly $30,600 per year, or borrowers in a family of four making under $62,400, make $0 monthly payments.
The changes would also halve the monthly payments for “borrowers who do not otherwise have a $0 payment in this plan,” the U.S. Department of Education said on its website.
The government’s student loan policies have also come under fire from personal finance company SoFi, which said earlier this month that the federal student loan payment moratorium had cost it $400 million.
It’s why SoFi has sued the U.S. Department of Education, claiming the moratorium has no legal standing and has severely curtailed SoFi’s loan refinancing business.
As PYMNTS wrote last year, student debt cancellation might be considered a “political football,” but it’s also likely to be a balm to consumers who live paycheck to paycheck, thus helping the broader U.S. economy.
Figures from the Education Data Initiative show households in the middle-class income bracket owe on average $43,090 in student loans, while the lowest income households owe about 12% of all student debt, or roughly $204 billion.