Republicans' new student-debt relief plan will 'leave students and families worse off' and make loans 'harder to repay,' a top Democratic lawmaker says
- GOP lawmakers introduced a bill to counter Biden's student-loan relief and end targeted loan forgiveness programs.
- Chair of the House education committee Bobby Scott said their bill will leave borrowers "worse off."
Three Republican lawmakers introduced an expansive piece of legislation that pushes back on many of President Joe Biden's student-loan relief actions. A top Democratic lawmaker isn't pleased with what they came up with.
On Thursday, GOP Reps. Virginia Foxx, Elise Stefanik, and Jim Banks introduced the Responsible Education Assistance Through Loan, or REAL, Reforms Act, which proposed a series of "alternative" policies to Biden's relief, including ending targeted student-loan forgiveness programs like Public Service Loan Forgiveness and capping the amount of loans graduate students can borrow.
While the Republican lawmakers said their proposals were the "responsible" way to help student-loan borrowers and save taxpayers money, Chair of the House education committee Bobby Scott said their legislation is not the right way to tackle college affordability.
"Regrettably, the proposal my Republican colleagues introduced yesterday misses the mark and would leave students and families worse off," Scott said in a statement on Friday.
"This proposal—especially the provisions to eliminate Public Service Loan Forgiveness and weaken Income Driven Repayment—would make student loans more expensive to obtain and harder to repay," he added. "Upon review, the Republican REAL Reform Act would have the opposite effect of the purpose of the student loan system and the Higher Education Act of 1965."
Biden is currently in the process of making a decision on broad student-loan forgiveness, reportedly considering $10,000 in relief for borrowers making under $150,000 a year. That announcement is expected in August, along with a decision on whether he will extend the student-loan payment pause past August 31. While Democratic lawmakers have been pushing for both an extension of the pause and broad debt cancellation, Republicans have pushed back on broad relief nearly every step of the way, and the legislation is just the latest of those efforts.
The programs that Republicans are hoping to cut, like PSLF, are ones that Biden's Education Department is in the process of reforming. For example, the department announced a waiver for PSLF that runs through October 31, 2022 that allows all past payments to qualify toward forgiveness progress, and it has already granted $8.1 billion in relief to 145,000 borrowers.
And while the Republican legislation is seeking to streamline income-driven repayment plans, which give borrowers affordable monthly payments based on their income with the promise of loan forgiveness after 20 or 25 years, the department is expected to announce a new, and simpler, income-based plan in the coming weeks.
Still, there continues to be uncertainty regarding the fate of student-loan borrowers as they continue to await news of a payment pause extension and debt cancellation. But what remains clear is that Democratic lawmakers hope the relief will be expansive while Republicans want the opposite.
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