U.S. Rep. Ashley Hinson of Iowa says student loan debt cancellation will only harm the economy and misrepresent the use of student loans to prospective borrowers.
07/05/2022 11:30 A.M.
3 minute read
The House Appropriations Committee discussed proposals from the Biden administration during a markup June 30, including an amendment to block plans for student loan debt cancellation from U.S. Rep. Ashley Hinson, R-Iowa.
“The Biden administration continues to ignore the boundaries of executive power … [W]ithout approval in Congress, President Biden is attempting to cancel hundreds of millions of dollars in student loan debt,” Hinson said.
As news reports on federal student loan forgiveness plans continue to circulate and Biden mulls over cancelling student debt through an executive action, questions remain about how much these actions would help borrowers and the economy, and what some of the other unintended consequences might be, ACA International previously reported.
Consumer advocates say Biden has the authority to forgive student loan debt through executive action and is supporting loan forgiveness of more than $50,000 per borrower.
Biden’s 2020 campaign included support for student loan forgiveness, such as a fixed amount of cancelled debt per borrower and a proposed program to stop debt for undergraduates with federal student loans and “incomes under $125,000 per year who attended public institutions or historically Black colleges and universities (HBCUs) and private minority-serving institutions (MSIs).”
The Biden administration has, in the meantime, adopted targeted tactics for student loan forgiveness through changes to requirements for federal student loan programs, such as the Borrower to Defense Repayment Program and Public Service Loan Forgiveness Program.
During the House Appropriations Committee markup June 30, Hinson said promising student loan debt cancellation will cause prospective college students not to think about if they can afford what they will borrow if they also think the loan will be forgiven or cancelled down the line anyway through policies being discussed today.
“All that this [a]dministration is proposing to do is shift that debt onto the backs of hardworking Iowans and Americans. It will be paid for by those who chose not to go to college and those who worked hard to pay back their loans,” Hinson said during her remarks. “Why should we make truck drivers, bartenders, electricians, and plumbers pay for someone else’s degree? Should a family farmer have to pay for somebody else’s Harvard education? Should my constituents who have already paid off their student loans have to now pay off someone else’s? Plain and simple the answer is no. Absolutely they should not.”
Several legislative proposals to rein in student loan cancellation are also circulating on Capitol Hill.
One, co-sponsored by U.S. Sens. Rick Scott, R-Fla., Cynthia Lummis, R-Wy., Mike Braun, R-Ind., and John Barrasso, R-Wy., will require the U.S. Department of Education to “obtain an express appropriation from Congress to pay for any federal student loan debts the department proposes to waive, discharge or otherwise reduce whenever granted to two or more borrowers in an amount greater than $1,000,000, rather than on a case-by-case basis,” according to a news release from Scott’s office.
There are also several other bills on Capitol Hill seeking student loan relief and student loan cancellation, Forbes reports.
“Report after report shows student loan forgiveness is a regressive policy that will harm our economy and it will benefit the wealthiest Americans at a disproportionate rate,” Hinson said during the appropriations hearing.
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