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Biden scraps debt relief programs, other policies

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The Biden administration’s ambitious plans to provide millions of Americans with debt relief are officially dead along with a number of other proposed regulatory changes.

The administration said on Friday that it was withdrawing two proposals to help the debts to be considered. The Department of Education has been considering thousands of ideas about the plans and is preparing to finalize at least one proposal before Friday’s announcement. I The Associated Press he first reported on the decision.

The department is also rejecting its proposal to amend Title IX to prohibit transgender students from participating in sports based on their gender identity. That proposal was controversial, receiving more than 150,000 comments and prompting a legal challenge to the department’s separate amendment to Title IX. added

“Due to the comments received and the various court cases, the department has decided not to rule on this matter at this time,” officials wrote in a notice to the Federal Register. added

The department also said on Friday that it is abandoning efforts to update the licensing, government approval and money management laws. Regulatory proposals were accelerated in the spring but have since been put on hold. Proposals to collect more data on distance education and open college prep programs to undocumented students appear to be moving forward. added

The department said that cutting off the rulemaking process in those three areas “will allow for more scrutiny of recent changes in other laws and industry practices.” added

The debt relief programs have been in effect since the summer of 2023 after the Supreme Court struck down President Biden’s first attempt to provide student loan forgiveness. Republicans and other critics say the latest debt relief programs, which would have benefited 36 million Americans, are unconstitutional and amount to an unfair transfer of wealth.

Education Department officials have maintained that they have the authority to forgive loans for students who meet certain criteria or are facing financial hardship, but concluded that they do not have time to make these proposals before Biden leaves office on January 20.

“As time remains in this administration, the Department is focusing on several priorities including the resolution of the court’s decision and helping borrowers manage the final aspects of recovery,” officials wrote in a Federal Register notice. “Currently the Department intends to use its limited resources to help borrowers at risk to return to paying effectively.”

Revoking the rule “will ensure the agency’s flexibility in reassessing problems,” the officials added. The move means the incoming administration will have to start the rulemaking process from scratch rather than simply rewrite the pending proposal.

Some Republican attorneys general have sued the administration over one of the plans, which would have provided targeted debt relief to borrowers who owe more than they originally borrowed or who have defaulted on their loans for more than 20 years, among other groups. That plan was blocked by a federal judge before the department could complete it.

The department’s decision came the same day the Biden administration announced another round of loan forgiveness. The Department of Education announced Friday morning that it will forgive the loans of 55,000 borrowers who have reached eligibility through Public Service Loan Forgiveness. A program created in 2007 and re-implemented under Biden, PSLF relieves a person of their outstanding debt if they successfully complete 120 monthly payments while working full-time in a public interest job such as law, health care or education.

Including Friday’s relief package, which totaled $4.28 billion, the Biden administration has now forgiven $180 billion in student loans for 4.9 million borrowers.

Borrower advocacy groups such as the Borrower Protection Center say that while they are disappointed the Biden administration had to withdraw its regulations due to legal backlash from right-wing advocates, they appreciate Biden’s efforts and celebrate the regulations he was able to finalize.

“President Biden’s overhaul of the Civil Service Loan Forgiveness program and other student loan assistance programs has brought about lasting change and will benefit millions of borrowers for years to come,” said Persis Yu, deputy executive director of the Borrower Protection Center, in a statement. But, at the same time, Yu added that “the actions of right-wing attorneys general have prevented tens of millions of borrowers from receiving critical student loan relief.”

Meanwhile, Republican lawmakers, including Senator Dr. Bill Cassidy of Louisiana, described Biden’s failed efforts to help students with debt as “a ploy to transfer student debt to the American taxpayer.”

“The student loan programs of the Biden-Harris administration have always been a lie,” the senator said in a statement. “Thanks to the recent withdrawal, they admit that these programs were nothing more than dishonest attempts to buy votes by passing on loans to taxpayers who never went to college or worked to pay off their debts.”

Jessica Blake contributed to this report.


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