Business & Economy

On The Money — Biden kicks the student debt can down the road again

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Today’s Big Deal: Multiple sources told The Hill that the Biden administration is expected to extend the student loan pause again. We’ll also look at a push by Sen. Bernie Sanders (I-Vt.) for a windfall profits bill, and how Senate Republicans blocked a $10 billion deal on coronavirus aid from advancing. 

But first, say hello to new Twitter director Elon Musk. 

Welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. For The Hill, we’re Sylvan Lane, Aris Folley and Karl Evers-Hillstrom. Someone forward you this newsletter? Subscribe here.


Biden expected to extend student loan pause 

The Biden administration is expected to announce another extension to the student loan pause this week, multiple sources told The Hill.  

The announcement could come as soon as Wednesday and would extend the moratorium on federal student loan payments and interest accrual past the current May 1 expiration date.   

  • President Biden is facing pressure by a growing number of Democrats to continue the freeze for several more months, with nearly 100 lawmakers across both chambers citing inflation as justification.
  • The measure was first put in place during the pandemic as a way to offer relief to those struggling to make loan payments. While it’s unclear when the new extension would end, Biden has faced calls to allow borrowers to pause payments until after the midterms.
  • Last month, White House chief of staff Ron Klain also signaled that the White House would extend the freeze. The Biden administration reportedly told companies in recent weeks to not send out notices about student loan payments resuming. 

The background: The president last extended the suspension in December. Loan payments were first put on hold in March 2020 under former President Trump and have since been extended five times. 

Whether Biden will act to forgive $10,000 in federal student loans per borrower is a looming question after he supported forgiving at least that much in the 2020 campaign. Progressives and activists pushed for more time to pay back debt publicly and privately this week and are seeking cancellation of an even larger sum. 

Read more here from The Hill’s Alex Gangitano and Hanna Trudo. 


LEADING THE DAY

Sanders pushes for 95 percent tax on corporate ‘windfall’ profits 

Senate Budget Committee Chairman Bernie Sanders (I-Vt.) on Tuesday made a push for a bill that seeks to levy a 95 percent tax on windfall profits of companies that bring in more than $500 million in revenue annually. 

Sanders highlighted reports detailing higher profits made by companies like Exxon Mobil and Tyson Foods during the pandemic. 

  • The legislation introduced by Sanders would apply to companies’ profits that are in excess of their average profit level seen in the five years leading up to the pandemic, according to a summary provided by his office.
  • Ahead of the midterm elections, a number of Democrats have pinned blame on corporate greed for rising costs, as inflation rates have hit heights not seen in four decades.
  • Sen. Lindsay Graham (S.C.), the ranking Republican on the committee, called the idea of a windfalls profit tax “a disaster” and blamed inflation on Biden administration policies such as the $1.9 trillion coronavirus relief package that passed Congress last year without GOP support. 

The hearing arrives as inflation has emerged as a key campaign issue ahead of the coming midterm elections, with Republicans and Democrats taking opposing positions on how to address rising prices. 

At the close of the hearing on Tuesday afternoon, Sanders reiterated focus “on inflation taking place at the same time as we’re seeing record breaking profits.” 

Check out more here from Aris


GRAND OPENING

Nearly three-quarters of US counties have more businesses than before pandemic: analysis 

Close to three-quarters of U.S. counties have seen a net gain of businesses since the start of the coronavirus pandemic, according to an analysis of federal data released Tuesday. 

  • By the end of September, 74 percent of U.S. countries had more physical business establishments than they did before the start of the COVID-19 pandemic and recession in March 2020, according to researchers at the Economic Innovation Group (EIG), a bipartisan think tank. 
  • Only 44 percent reached that level five years after the end of the 2007-08 recession and financial crisis.  
  • In a nutshell: EIG analyzed the latest data from the Bureau of Labor Statistics’ quarterly census of employment and wages up through the third quarter of 2021. The think tank found signs of a much stronger economic rebound, with fewer permanent business closures, than many economists expected at the onset of the crisis. 

    Sylvan breaks it down here. 


    NO DEAL?

    GOP blocks advancing COVID-19 deal amid Trump-era immigration fight 

    Republicans on Tuesday blocked the Senate from advancing a $10 billion deal on coronavirus aid amid a stalemated fight over whether to attach a Trump-era immigration policy to the agreement. 

    Absent a breakthrough, the stalemate would delay the coronavirus bill until after a two-week break that is expected to start by Friday. To pass the deal before that, they would need buy-in from all 100 senators. 

    • Senators voted 47-52 to advance legislation that’s being used as a vehicle for the coronavirus agreement, falling short of the 60 votes needed to move forward.
    • Republicans want a vote on blocking the Biden administration from rescinding Title 42 — a Trump-era public health policy that allows for the rapid expulsion of migrants at the border due to the risk of the virus — as part of a deal to speed up the bill. 

    The Hill’s Jordain Carney has more here


    Good to Know

    The White House is poised to announce new sanctions on Russia this week that include a ban on new investments and sanctions on Russian government officials and their family members.   

    The sanctions will also target Russian-owned financial institutions and state-owned enterprises, according to White House press secretary Jen Psaki, who said the sanctions were being coordinated with the Group of Seven and European Union.   

    Psaki told reporters Tuesday that the sanctions are in response to recent killings in Bucha, a town near the Ukrainian capital of Kyiv, as well as other Russian acts of violence in Ukraine that the U.S. has said constitute war crimes.    

    Here’s what else we have our eye on: 

    • Saudi Arabia’s state oil producer is set to hike prices across regions as the kingdom’s advantage in the market grows amid the Ukraine crisis, blowing past an April record. 
    • The Hill documented the five states that currently have the highest gas prices in the country, according to the latest data from AAA.
    • The Department of Treasury on Tuesday sanctioned Russia’s largest and “most prominent” darknet market, Hydra Market, in a coordinated resolution intended to disrupt malicious cybercrime services, the selling of drugs and other illegal activities. 

    That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and coverage. We’ll see you tomorrow. 

    Tags Bernie Sanders Elon Musk

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