GOP backlash against student loan freeze grows

Republican criticism of the freeze on student loan repayments and interest is growing in the wake of President Biden’s extension of the moratorium until late summer.

GOP criticisms range from the extension representing an expensive handout to “elites” to saying that Democrats are displaying hypocrisy for extending pandemic-era policies that they like while rolling others back.

“How was it fair to somebody like myself who just paid his off?” said Rep. Byron Donalds (R-Fla.), adding that he recently made a lump sum to pay off his loans 20 years after graduating from college.

“I grew up poor. I’ve never been rich, but I had an ability to pay, make my payments consistently over time, and then pay it off,” Donalds said.

Sen. Tom Cotton (R-Ark.) accentuated that point in a tweet on Tuesday.

“President Biden’s perpetual student loan payment moratorium is an insult to every American who responsibly paid debts,” Cotton said. “There’s no free lunch: this reckless move puts taxpayers on the hook for billions.”

Biden on Wednesday extended the freeze on student loan and interest payments until Aug. 31; it had been scheduled to expire on May 1. It is the sixth extension of the pause that started in March 2020, having been initially enacted and then twice extended by former President Trump at the start of the COVID-19 pandemic.

The move drew support from a number of Democrats and student loan debt activists who have been pushing Biden to use executive authority to outright cancel a chunk, or all, of student debt.

Debt cancellation advocates argue that the more than two-year freeze so far has shown that it benefits low-income individuals whose debt burden keeps them from saving and advancing economically, and that it can help to close racial wealth gaps.

Republicans argue that rather than helping disadvantaged classes of individuals, the freeze benefits those in higher social and economic classes.

Rep. Bob Good (R-Va.), who last month introduced a bill that would end the pause on student loan payments, told The Hill that the “ridiculous” freeze on will “keep hardworking Americans on the hook for the elites with advanced degrees.”

“The ongoing moratorium on federal student loans has cost taxpayers over $100 billion total, at a rate of $4.3 billion per month,” Good added.

In a statement, Education and Labor Committee ranking member Rep. Virginia Foxx (R-N.C.) said that taxpayers are “footing the student loan bill for graduate students and Ivy League lawyers.”

Foxx also took aim at the Biden administration and the Education Department for acting to continue the pause without Congress. The pause was initially authorized by the CARES Act, the first COVID-19 aid bill, but extensions have taken place with executive authority.

“Ruling via executive fiat is the epitome of cowardice and happens when an administration’s policies are so radical, they can be carried out only in secret,” Foxx said in a statement to The Hill. “There’s never a modicum of transparency within the process – only diversion and delay – as is the case with the Department and its involvement in the student loan repayment pause. If the Department believes it can avoid our questions forever, with no repercussions whatsoever, it is sorely mistaken. The chickens will come home to roost.”

The Department of Education has said that the student loan pause has cost the federal government more than $100 billion. According to House Budget Committee Republicans, the program costs about $4.3 billion per month.

“The student loan payment moratorium disproportionately benefits borrowers who obtain graduate degrees and high-income employment,” Rep. Jason Smith (R-Mo.), ranking member on the House Budget Committee, said in a statement. “President Biden claims his Administration is laser-focused on deficit reduction, while simultaneously tiptoeing towards a plan from the progressive wing of the Democrat party to forgive all federal student loans – a plan that would give a taxpayer-funded bailout to the wealthiest twenty percent of American households and add $1.6 trillion to our already massive national debt.”

Senate Majority Leader Charles Schumer (D-N.Y.) and Sen. Elizabeth Warren (D-Mass.) are among those in the Democratic Party pushing Biden to erase $50,000 per borrower in student debt. Biden proposed erasing up to $10,000 per borrower in student debt during his campaign, but has not endorsed the idea of permanently doing so with executive authority.

Smith also knocked the Biden administration for extending the program while it is rolling back other pandemic-era policies. The Title 42 policy put in place during the pandemic that allows border enforcement agents to turn away migrants without them first seeing an immigration judge is set to expire at the end of May.

“Once again, Democrat COVID hypocrisy prevails,” Smith said, saying that Biden will “side with the wealthy interests of his party over the American people.”

Donalds, the congressman who recently paid off his loans, acknowledged that he has more ability to pay off the debt than some other people due to his job as a member of Congress and background in finance. But he advocated for a change in mindset for those taking on student loans.

“I don’t want to be glib, but young people have to take stock of what they’re majoring in. You know, why would I go to a private university to major in art history? Odds are you’re not getting a job, definitely in your degree field, in order to pay back the money that you’re taking on.”

Rebecca Beitsch contributed.