Biden Sends Wrong Message to Student Loan Borrowers
WASHINGTON, D.C., April 6, 2022
Today, Education and Labor Committee Republican Leader Virginia Foxx (R-NC) released the following statement after the Biden administration announced that it will move all borrowers who have defaulted on their student loans into good standing:
“Like clockwork, the Biden administration continues to govern by executive fiat without any consideration for the consequences of its actions. Today’s decision is par for the course. The Education Department has provided zero information to everyone involved, including the servicers who will be tasked with carrying out this ‘operation.’ This ambiguous and flippant roll out will lead to mass confusion among borrowers likely causing new defaults. This is what happens when reckless ambition supersedes commonsense.
“Unsurprisingly, there are still questions as to whether this administration even has the authority to unilaterally move 7 million borrowers into repayment status. It’s been months since this action was first rumored, and in that time the Education Department has not briefed, discussed, or informed Congress, the servicers, or the borrowers about how this ‘operation’ will work. I hope the administration has spent the time carefully reviewing the legal authority and will share that detailed assessment with Congress prior to promising something it does not have the legal authority to do.
“By taking the financial consequences of defaulting on student loans out of the equation, any incentive for future borrowers to make good on their obligations to taxpayers goes out the window. Whether its sheer incompetence or an intentional ploy to set the table for widespread forgiveness, President Biden is turning a student loan problem into a full-fledged catastrophe at the expense of borrowers and hardworking taxpayers.”