The GOP Has Declared War on Student Loans

Joe Biden spent much of his presidency trying to change how student loan debt works; but nothing much changed.

Biden promised a student loan forgiveness plan during his 2020 campaign, following a provision in the early 2020 CARES Act that paused payments on most federal student loans.

Per a timeline published by WDSU, in August 2022, Biden announced that he would cancel $10,000 per borrower in student loan debt, with that number doubled for Pell Grant recipients. The following month, six states sued Biden and the Department of Education, and in November, the DoE stopped accepting applications for forgiveness.

The Student Loan Battles

In June 2023, the U.S. Supreme Court struck down Biden’s student loan forgiveness plan. By this time, Biden had used considerable political capital to push the plan, and once it failed, he went on to earn the wrath of some in the Democratic Party base for not successfully delivering on his promises.

Repayments resumed that fall. Separately, Donald Trump announced that he would forgive billions worth of student loan debt issued by fraudulent colleges. Now, with Donald Trump back in the presidency, the GOP is pushing its own overhaul of student loans.

Congress’ Plan

Per CNBC, the House Education and Workforce Committee has released what they call the Student Success and Taxpayer Savings Plan, which is planned to be part of a tax and spending package that the president hopes to pass this spring or summer. The committee, in its statement, referred to the bill as a “big, beautiful bill.”

“Our current student loan system is broken and has left students holding over $1.6 trillion in federal student loan debt, with taxpayers estimated to lose hundreds of billions of dollars on loans disbursed over the next decade,” the committee’s chairman, Tim Walberg (R-MI), said in the statement.

Walberg went on to blame the Biden administration for “misguided and unlawful actions [that] have only added to this crisis rather than address the root issues.”

What’s In the Plan?

The committee claims that its bill will save $330 billion, to “help advance President Trump’s agenda to provide tax relief for American families and small businesses, rein in wasteful spending, and reduce the federal budget deficit.”

The bill has three objectives, the committee says: “Strengthening accountability for students and taxpayers, streamlining student loan options, and simplifying student loan repayment.”

The plan will put in place a $50,000 borrowing cap for federal student loans; that figure rises to $100,000 for graduate students. It will also leave borrowers fewer options for income-driven repayment loans, while also raising the minimum number of hours required for Pell Grant eligibility from 12 hours per semester to 30 hours per academic year.

The Case Against

In the liberal outlet The American Prospect this week, David Dayan argued that the GOP plan would make student loans “an expensive, punitive, and downright dangerous financial vehicle.”

He added that, as pointed out in the committee’s fact sheet, the plan would cut hundreds of millions of dollars from students to pay for tax cuts, most of them geared towards the wealthy.

“The pipeline from stingier financial aid to tax cuts is clear,” he wrote.

Will It Pass?

The bill will next go to the Budget Committee, before consideration on the full House floor.

However, it’s not clear if this plan will end up passing as part of the final “Big Beautiful Bill”—if one passes at all.

Congress is very much divided over what might be included in the “Big Beautiful Bill.” Some members of Congress prioritize tax cuts, with others caring more about the deficit, and still others having individual dealbreakers that must be addressed if it is to move forward. And if a version passes the House, it may or may not pass the Senate as well.

So, compromises must be made if the GOP wants to see the bill through, meaning that its student loan plan might not pass in the form that the committee has presented.

About the Author

Stephen Silver is an award-winning journalist, essayist and film critic, and contributor to the Philadelphia Inquirer, the Jewish Telegraphic Agency, Broad Street Review and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. For over a decade, Stephen has authored thousands of articles that focus on politics, technology, and the economy. Follow him on X (formerly Twitter) at @StephenSilver.