Ocasio-Cortez knocks Biden plan for student loan interest to kick in during ‘on-ramp’ period

Rep. Alexandria Ocasio-Cortez (D-N.Y.) took aim Sunday at President Biden’s plan for student interest to restart during his proposed “on-ramp” period.

Ocasio-Cortez told CNN’s Dana Bash on “State of the Union” that she would like to see interest on payments suspended during the 12-month on-ramp period the Biden administration proposed after the Supreme Court struck down the president’s student debt forgiveness plan last week.

“I would like to see interest payments suspended during this time, especially during that 12-month ramp-up period,” Ocasio-Cortez said. “There are millions of people in this country that have student loan debt under — student loan debt amounts under $10,000 or $20,000, as outlined in the plan.”

“People should not be incurring interest during this 12-month on-ramp period. So, I highly urge the administration to consider suspending those interest payments,” she added.

Biden’s new plan includes an “on-ramp” repayment program for those who may miss payments when they resume this fall that removes the threat of default or harm to credit ratings for 12 months, as the Education Department will not refer borrowers who miss payments to collection agencies or credit bureaus.

In addition, Biden reintroduced his forgiveness plan grounded in the Higher Education Act (HEA), which proponents of the plan argue allows the education secretary to  “compromise, waive or release” student loans. Ocasio-Cortez said that she believes the administration has the authority to forgive student debt under the HEA.

“Myself, as well as other members of the Congressional Hispanic Caucus, met with the White House recently around this plan, as well as many other advocates in the space as well. And we truly believe that the president — Congress has given the president this authority,” she said. “The Supreme Court is far overreaching their authority. And I believe, frankly, that we really need to be having conversations about judicial review as a check on the courts as well.”

The plan announced last year would have canceled up to $20,000 in loans for Pell Grant recipients and $10,000 for other borrowers with incomes less than $125,000.