Mitch McConnell slams Biden’s student loan payment pause extension: ‘We need to remind people that we’re all paying our debts’
The Senate Minority Leader doesn’t think student borrowers should continue to get relief.
“I think in this country we should remind people that we all pay our debts,” Mitch McConnell said. Told Fox News Sunday.
“And in terms of extending the moratorium, again quoting Larry Summers, he said it was exactly the wrong thing to do in the midst of this overheated economy, to bring down this rapid inflation,” McConnell added. “This administration just can’t get its act together on the economy.”
McConnell was probably referring to a Tweeter by Larry Summers, former President Barack Obama’s chief economist, who wrote that another extension of student loan relief is “regressive, uncertainty-creating, untargeted, and inappropriate at a time when the economy is overheated”.
Last week, President Joe Biden extended the suspension of student loan payments until August 31, with interest relief. This is the fourth time he has been extended during his term. First implemented by former President Donald Trump as a form of pandemic relief, the pause was intended to give federal borrowers financial breathing room as they dealt with the impact of COVID- 19. As Biden fielded calls from many Democratic lawmakers for another extension, Republicans argued that with inflation rising, continuing to suspend payments would only hurt taxpayers and the economy, criticizing general emergency measures.
For example, as Insider reported, Republican lawmakers have long been urging Biden not only for another payment break extension, but also for a large student loan forgiveness. Representative Virginia Foxx, the top Republican on the House Education Committee, called the latest extension “outrageous” and said she feared it was “setting the stage for a blanket cancellation of loans.”
Arkansas Senator Tom Cotton wrote on Twitter that “Biden’s perpetual moratorium on student loan payments is an insult to all Americans who have paid their debts responsibly.”
Republicans cited the $150 billion cost to taxpayers in the form of lost federal revenue with previous student loan breaks, and some also said additional relief should not yet be tied. to the pandemic, going so far as to introduce legislation that would block the Education Secretary from using the pandemic as a reason why an extended payment break is warranted.
Democratic lawmakers argued otherwise. Many of them argued that broad student loan relief would stimulate the economy, and they said that’s a cost the government can afford to pay. For example, Congressional Progressive Caucus Chair Pramila Jayapal recently Told Meet the press that “a lot of that money is money that the federal government makes and these debt collectors make on higher interest rates than what we actually have to charge.”
“If you look at the big picture, why would we be working against ourselves if the goal is to educate as many people as possible with the highest qualifications, whether it’s a community college, a college of four or trade school and get into jobs where they can support themselves and their families?” she added.
Still, it’s unclear what kind of relief student loan borrowers will receive once the current pause on student loan payments expires. White House press secretary Jen Psaki said last week that Biden “did not rule out” canceling some of the student debt through executive action, but then went on to told Fox News that borrowers will likely have to pay off their debt “one day” while Biden is in office, causing uncertainty about what actions the administration will pursue.