President Joe Biden is making another attempt to alleviate the burden of college graduates through a comprehensive debt transfer plan. This is not the first time he has used tax dollars to gain favor with a crucial political demographic, nor is it the first time that state attorneys general have united in their efforts to thwart his plans.
The president is clearly concerned about losing support from younger voters, which has caused him to take action. In an effort to retain their loyalty, Biden is implementing strategies to secure their votes. His approach involves building a strong support base and he intends to finance this by taxing blue-collar workers.
President Biden’s plan, in contrast to former President Donald Trump’s approach, does not prioritize American working-class taxpayers. Unlike Trump, who used a renegotiated trade deal to fund the border wall, Biden’s plan seems to favor the over-educated, under-employed younger voters who have accumulated substantial debt without a clear repayment strategy.
Biden is hopeful that his gamble will lead him back to the White House. Nevertheless, there is a determined group of state attorneys general who are fully committed to legally dismantling Biden’s blue wall, just as they did in the past.
The law and recent precedent favor their position, but they are running out of time.
In 2022, the president made a unilateral attempt to cancel $430 billion in student loan debt. However, this action was met with opposition as six states filed a lawsuit in federal court. With the help of public advocacy groups like the Foundation for Government Accountability, these states successfully thwarted the administration’s apparent efforts to bribe a crucial constituency.
The Supreme Court made it clear in its ruling that Biden’s scheme violated the Constitution, but his administration did not back down. Just two weeks later, they introduced a similar plan, but with a new name – the SAVE Plan. Under the guise of this program, student loan debt will be shifted onto the American taxpayers. However, this revised plan is projected to cost Americans $30 billion more than Biden’s original student loan bailout.
The Secretary of Education’s authority to create income-driven repayment (IDR) plans for student borrowers is being unlawfully expanded. These plans enable borrowers to repay their loans based on their income, rather than the amount of debt and repayment period, similar to how home, auto, and business loans are managed.
Before the SAVE Plan, it is important to mention that Congress had already approved some loan forgiveness through IDR programs. These regulations typically required borrowers to pay a minimum of 15 percent of their disposable income for a duration of 20 or 25 years before qualifying for the forgiveness of the remaining balance.
The current program, although already generous, falls short of energizing a crucial voting bloc for the Democrats. Hence, the Biden administration is making efforts to reduce monthly payments, often down to $0, provide assistance for interest charges, and even forgive entire loans for millions of borrowers. To put it into perspective, the SAVE Plan enables borrowers to make $0 payments while taxpayers cover the accruing interest.
Those who did not attend college or funded their own education are bearing the brunt of this plan. Some individuals worked part-time jobs while in school, others diligently saved to repay their loans after graduation, some served in the military, and some decided to invest their resources elsewhere. Now, they are being compelled to financially support the choices made by others, without receiving any compensation in return. It is an unfair arrangement for those who abided by the established norms and funded their own education.
Republican attorneys general are taking the lead once again in defending taxpayers and upholding the Constitution. In March, Kansas Attorney General Kris Kobach, along with 10 other Republican attorneys general, filed a lawsuit in the 10th Circuit to halt the implementation of the SAVE Plan. Following suit, last month, Missouri Attorney General Andrew Bailey and six other Republican attorneys general initiated a similar legal action in the Eighth Circuit.
If the courts do not intervene to stop this revamped student loan bailout, we should anticipate an increase in consumer prices, higher tuition fees, more bailouts, and, ultimately, further solidification of the electoral barrier that Biden is constructing.
