The Hill reports that the debt ceiling deal reached between President Joe Biden and House Speaker Kevin McCarthy (R-CA) includes a provision that will cut short the Biden administration's pause on federal student loan payments.
McCarthy released the full text of the deal - which has been titled, the Fiscal Responsibility Act of 2023 - on Sunday.
Biden, in the leadup to the 2022 midterm elections, put forth a plan to cancel up to $10,000 in federal student loan debt per borrower, or up to $20,000 if the borrower is a Pell Grant recipient.
Biden sought to implement this plan through executive action alone, which opened the plan up to a legal challenge. This legal challenge, thus far, has halted Biden's plan. And, now, the U.S. Supreme Court is considering its legality.
In the meantime, Biden has placed a pause on student loan repayments. Now, it appears that this pause will end early.
McCarthy, during a Fox News Channel appearance on Sunday, said that "the pause is gone within 60 days of this being signed."
If true, this means that Biden's student loan pause will end roughly a month earlier than it was scheduled to do so. And, according to McCarthy, the deal is such that the pause will end regardless of what the Supreme Court decides.
McCarthy referred to this as "another victory," saying that it will bring in $5 billion each month.
Education Secretary Miguel Cardona, in a statement of his own, attempted to soften the reality of this situation, writing:
Despite Republicans’ efforts to end targeted student debt relief and move up our planned end to the payment pause, we will ensure a smooth return to repayment process. The deal also protects our ability to pause student loan payments should that be necessary in future emergencies.
The deal reached between Biden and McCarthy suspends the debt ceiling for a two-year period, averting default and the negative economic consequences that default would entail - should the deal be approved by both the U.S. House of Representatives and the U.S. Senate.
In exchange for the two-year debt ceiling suspension, several agreements were reached regarding spending.
According to the Washington Examiner, for example, non-defense and non-veteran discretionary spending growth will be effectively kept down until 2024 before increasing by roughly 1% in 2025."
The deal also adds stricter work requirements to Temporary Assistance for Needy Families (TANF) and Supplemental Nutrition Assistance Program (SNAP), cuts back on the Biden administration's expansion of the Internal Revenue Service (IRS), and rescinds unspent COVID-19 funds, among other things.
The House is expected to vote on the deal on Wednesday.
