President Joe Biden is – once again – attempting to bail out college grads with a sweeping debt transfer plan. It’s certainly not the first time he’s tried to curry favor with a key political constituency using tax dollars. It’s also not the first time state attorneys general from around the country have worked to stop him.
Clearly, the president is worried about his dwindling political base, especially among younger voters. In response, he’s attempting to keep them in the fold. Biden is trying to build a blue wall by buying votes, and he wants blue-collar workers to pay for it.
But unlike former President Donald Trump using a renegotiated trade deal to offset the costs of the border wall, President Biden’s plan doesn’t put American working-class taxpayers first. In fact, his new plan rewards many in the over-educated, under-employed cohort of younger voters that racked up incredible amounts of debt without a real plan to pay it back.
Biden hopes the spoils of his gambit will be a return to the White House. However, a dedicated group of state attorneys general are committed to legally dismantling Biden’s blue wall brick by brick, much like they did before.
The law and recent precedent are on their side. But time is not.
In 2022, the president attempted to cancel $430 billion in student loan debt unilaterally. Six states brought suit in federal court and, with the aid of public advocacy groups like the Foundation for Government Accountability, successfully foiled the administration’s obvious attempts to bribe a key constituency.
The Supreme Court was unambiguous in its ruling that Biden’s scheme violated the Constitution, but his administration was not deterred. Barely two weeks later, it unveiled the same plan, now repackaged, to shift student loan debt onto the American taxpayers. Speciously titled the SAVE Plan, the program is estimated to cost Americans $30 billion more than Biden’s initial student loan bailout.
The plan unlawfully expands the Secretary of Education’s authority to create income-driven repayment (IDR) plans for student borrowers. IDR plans allow borrowers to repay their loans according to their income, instead of the size of their debt and the length of their repayment period, as is required for home, auto, and business loans.
It’s worth noting that prior to the SAVE Plan, Congress had already authorized some loan forgiveness under IDR programs. Under those regulations, borrowers were generally required to pay at least 15 percent of their disposable income for a minimum of 20 or 25 years before becoming eligible to have the remaining balance forgiven.
The trouble is that this already generous program is not enough to energize a key Democrat voting bloc, which is why the Biden administration is trying to slash monthly payments (in many cases to $0), cover payments for those who fail to cover their monthly interest charges, and outright cancel entire loans for millions of others. Just to give you an idea of how ludicrous this is, the SAVE Plan allows borrowers to make $0 payments and have taxpayers cover their accruing interest.
This plan comes at the expense of those who either chose not to go to college or paid their own way through. Some worked during school, some scrimped and saved to pay off loans once they graduated, some joined the military, and others chose to invest their time and money in other endeavors. Now they are being forced to underwrite the choices that others chose to make, with nothing in return. It is a raw deal for those who followed the rules and paid their own way.
Republican attorneys general are once again leading the effort to defend taxpayers and the Constitution. In March, Kansas Attorney General Kris Kobach and 10 other Republican attorneys general filed suit in the 10th Circuit to stop implementation of the SAVE Plan. Last month, Missouri Attorney General Andrew Bailey and six other Republican attorneys general brought a similar suit in the Eighth Circuit.
If the courts don’t halt this repackaged student loan bailout, we can expect inflated consumer prices, higher tuition, additional bailouts – and ultimately harden the mortar in the electoral wall Biden is building.
