Ahead of the upcoming 2024 presidential election, President Joe Biden is yet again flouting the Supreme Court and forging ahead with forgiving more student loan debt.  Any type of widespread forgiveness would shift the cost of higher education from those who have voluntarily taken out student loans to every single taxpayer, including those who have paid off their loans or never attended college.  The latest iteration of Biden’s student loan forgiveness plan is an unconstitutional ploy ahead of the upcoming election and should be rejected by Congress and voters. 

On April 12, 2024, President Biden announced that he will forgive student loan debt for 277,000 more borrowers.  This unilateral action is expected to cost taxpayers $7.4 billion and would bring the total amount of debt relief since Biden took office to $153 billion for 4.3 million borrowers.  President Biden took this latest action even though just last year the Supreme Court ruled that the president did not have the authority to unilaterally forgive student loan debt.

Four days earlier, on April 8, 2024, President Biden unveiled a  plan that would expand debt forgiveness to certain borrowers.  One part of Biden’s plan would give relief to borrowers whose balance has grown because of unpaid interest.  According to a White House fact sheet, borrowers could have up to $20,000 of unpaid interest forgiven regardless of income.  The plan also allows for low and middle-income borrowers who are enrolled in an income-driven repayment plan, like the SAVE plan, and earn less than $120,000 as a single tax filer or $240,000 for a married household, to have all their accrued interest forgiven.  The White House boasts that this plan would “forgive interest balances built up to date for 25 million borrowers, with 23 million likely to have all of their balance growth forgiven.” 

The April 8 plan would also allow the Department of Education to use data to identify eligible borrowers and automatically forgive their student loan debts.  President Biden and his administration claim that these borrowers have faced burdensome paperwork requirements and other obstacles that have prevented them from enrolling in a plan that would eventually cancel their debt.  The administration also plans to forgive debt for borrowers who entered repayment plans over 20 years ago and those who enrolled in schools that lost eligibility or recertification for the federal student aid program. 

The April 8 plan also includes a provision that would cancel student debt for borrowers who are facing tough economic times that make them unable to fully repay their loans.  In a speech promoting his plan, President Biden said “the Department of Education will propose a new rule to cancel student debt for Americans facing financial hardships, from childcare to healthcare, that prevent them from paying back their loans.”  The definition of financial hardship or who is eligible for this relief is not clear.  Thanks to the inflationary policies that have defined his first term in office, nearly every American with or without a college loan is facing financial hardships.  According to the Penn Wharton Budget Model, the plan would cost $84 billion, and would bring the sum of all of Biden’s forgiveness plans to $559 billion.

President Biden is once again exceeding his legal authority in another political stunt to court young voters ahead of the 2024 election.  This unfair policy is not only unconstitutional, but also deeply unfair, would raise taxes on every taxpayer, and do nothing to address the rising cost of tuition.  According to the House Budget Committee, tuition fees increased by 186 percent from 2000 to 2023, more than double the increase in inflation, and 56 percent of all student loan debt is owed by 14.3 percent of borrowers who have a graduate degree.  The committee also estimated that the five new provisions included in the April forgiveness plans could cost up to $750 billion and that since taking office President Biden has tried to forgive more than $1 trillion in student loan debt.

This latest attempt to take more money from taxpayers to pay off someone else’s loan should be rejected by the courts when it invariably faces legal challenges and Congress should continue to push back on this executive overreach.