Staff Reports
Vice President Kamala Harris is at the forefront of efforts to increase enrollment in a program that enables the majority of student loans to remain outstanding, thereby placing the financial burden on the American taxpayer. Supporters of the Saving on a Valuable Education (SAVE) Plan are endorsing the "SAVE Day of Action" organized by the Biden administration. This initiative aims to facilitate the elimination of monthly student loan payments for borrowers with lower incomes to zero percent and to forgive loans entirely within a decade.
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Harris stated, "President Biden and I are both cognizant of the fact that a significant number of Americans are contending with the burden of student loan debt." "For this reason, we have already granted nearly four million Americans pardons totaling nearly $144 billion, while simultaneously formulating the SAVE Plan to enable millions more to reduce their payments by half or eliminate them entirely."
According to the White House, more than forty additional organizations are participating in the promotion of the plan, which includes the Service Employees International Union and the U.S. Chamber of Commerce. Nevertheless, Congress did not approve the SAVE Plan, which has generated considerable debate on account of the moral hazard imposed on diligent taxpayers for any unpaid obligations.
Andrew Gillen of the CATO Institute proclaimed, "The SAVE plan is an absolute catastrophe from a policy standpoint." It is estimated that the cost to taxpayers over the next decade will be an enormous $475 billion.
SAVE amends prior income-driven repayment initiatives by reducing student loan payments from 10% to 5% of income, increasing the income threshold beyond which repayment is required from 150% to 225% of the poverty line, and reducing the repayment period for specific borrowers from 20 years to 10 years. Certain scholars contend that in essence, it converts student loans into grants that lack specific targets.
Gillen nonetheless acknowledged that the loans are a bargain for whoever obtains them. "From an individual standpoint, the student loan borrower is powerless to prevent it," he further stated. Borrowers ought to capitalize on the opportunity while the program remains operational.
Secretary of Education Miguel Cardona, White House Domestic Policy Advisor Neera Tanden, Director of the Office of Public Engagement Stephen Benjamin, and additional senior administration officials will be in attendance at an event hosted by the Biden administration to promote the program. However, their persuasive rhetoric should not mislead you—this program constitutes a substantial financial burden on diligent American taxpayers and should be exposed for what it truly is: a perilous and imprudent proposition that merely shifts responsibility to subsequent generations.
