U.S. Sen. Tom Cotton (Photo Courtesy of the Committee on Arrangements for the 2020 Republican … [+]
If President Joe Biden grants more student loan relief, this politician says it will be a terrible idea.
Here’s what you need to know.
Sen. Tom Cotton (R-AR) says that if Biden extends temporary student loan relief for a fourth time, then it will be a policy disaster.
“The Biden administration is considering *extending* the student loan moratorium,” Cotton tweeted. “This is a terrible idea.”
“There’s no free lunch. Permanent “moratoriums” put taxpayers on the hook for trillions while letting college grads — even rich ones — avoid paying their debts.”
Sen. Tom Cotton (R-AR) says extending student loan payment pause is “a terrible idea.”
Cotton says that pausing student loan payments again means that the government will be paying debt for individual borrowers when it should be the borrower’s financial responsibility.
Cotton isn’t the only lawmaker that opposes continuing the student loan moratorium. Rep. Virginia Foxx (R-NC), the leading Republican on the House Committee on Education and Labor, said that Biden’s third extension of student loan relief was a mistake. Among her comments:
(Here’s who won’t get student loan forgiveness)
Student loans for federal student loan borrowers are scheduled to restart May 1, 2022. This means that borrowers will:
Postpone restart of student loans: Progressives in Congress, including Sen. Elizabeth Warren (D-MA), are concerned that student loan borrowers aren’t prepared financially or psychologically to restart federal student loan payments in approximately 60 days. They want Biden to extend student loan relief for a fourth time, which could postpone federal student loan payments to later this year. (Will student loan relief get extended until 2023?). Progressives also are concerned that the U.S. Department of Education hasn’t prepared borrowers for the return of student loan payments. (Here are the key questions members of Congress are demanding to know answers).
Democrats could lose election: Progressives also warn that Democrats could lose the midterm election this November, causing widespread losses in congressional races. Why? Progressives argue that Democratic voters won’t support Democratic candidates unless Biden cancels student loans for most or all borrowers. (Student loan forgiveness could be reason Democrats lose the election).
Student loan cancellation: While Cotton and Fox don’t support more of this student loan relief, some Democrats aren’t even stopping with student loan relief. Instead, they are focused on pressuring Biden to enact wide-scale student loan cancellation through executive action. (Bernie Sanders says Biden should cancel $1.8 trillion of student loans). Biden has cancelled more than $15 billion of student loans. However, he has doubted his legal ability to cancel everyone’s student loans without further authorization from Congress. That said, Congress hasn’t even voted on wide-scale student loan cancellation or negotiated bipartisan legislation that could deliver student loan cancellation to borrowers. (Student loan cancellation reduced to $25,000 for borrowers).
Biden hasn’t made any decision on extending student loan relief. The White House and U.S. Department of Education both have referenced that federal student loan repayments will restart once student loan relief expires on May 1. However, progressives in Congress are hoping there will be continued relief for borrowers. Student loan borrowers haven’t had any mandatory federal student loan payments in nearly two years. Given there’s been no announcement, borrowers should expect that payments will restart as planned. Make sure you know each of your options for student loan repayment, including these popular ways to pay off student loans faster: