Controversy erupted last week following the announcement of the Biden administration’s plans to “forgive” potentially hundreds of billions of taxpayer dollars worth of outstanding federally backed student loan debt for millions of borrowers.
Yet, President Joe Biden’s administration had already quietly written off at least $10 billion in outstanding federal student loan debt through a special limited program that was vastly expanded under the ubiquitous excuse of the COVID-19 pandemic, the Daily Wire reported.
Waiving previously stringent requirements for debt relief
That program is known as the Public Service Loan Forgiveness program, which previously allowed for limited forgiveness of some remaining student loan debt for government employees who met certain stringent eligibility requirements, such as 10 years of public service and an unblemished track record of repayments on certain qualifying loans.
In October 2021, however, the Education Department announced that due to executive actions and the ongoing pandemic, the PSLF program had been expanded to also include non-profit employees and the department would now waive or relax most of the prior eligibility requirements to have a debt qualify to be canceled.
The waiver worked to extend eligibility to all types of federal student loans, gave credit toward the 10-year threshold for all prior years — even if payments were late or never made or were deferred, and also launched an automatic review process of all previously denied applications for relief under the formerly limited program.
Now, a press release last week from the Education Department revealed that it had “approved more than $10 billion in debt relief for over 175,000 borrowers in 10 months” by way of the temporarily expanded PSLF program.
It was further noted that more than 1 million borrowers had been granted credit through the program that they otherwise would have been ineligible to receive toward future forgiveness of their outstanding student loan debts.
Temporary waivers to be made into permanent rule
The Daily Wire noted that while President Biden’s Education Department had initially cited the COVID-19 pandemic as the driving force behind the temporary waiver of PSFL program requirements, that was most likely just an excuse and loophole for the administration to use to do what it actually wanted to do permanently in the first place.
Indeed, the Education Department issued a notification in July that it had issued a proposed regulation that would make the rule changes brought about by the temporary waivers permanent.
The department noted that it intended make that proposed rule final by November 1 of this year and that, if approved, would take effect no later than July of 2023.
An unacceptable development
President Biden, whether of his own volition or under pressure from his left flank, has now obscenely soaked the average American taxpayer — the vast majority of whom never even attended or graduated from college, much less incurred massive debt doing so — to help cover the financial obligations voluntarily taken on by attorneys, doctors, government workers, and the predominately liberal and wealthy professional-managerial class who now don’t want to pay back what they initially borrowed.
This is not good and is completely unacceptable, but it remains to be seen if any legal challenges against this gross fiscal injustice will prevail in the courts and force the administration to revert back to the old rules governing federal student loan debts.