Republican Stimulus Plan Provides Nothing For Student Loan Borrowers

Ruben Onsu

WASHINGTON, DC – JANUARY 3: Sen. Susan Collins, R-Maine, participates in a mock swearing-in for the … [+] 117th Congress with Vice President Mike Pence in the Old Senate Chambers at the U.S. Capitol Building January 3, 2021 in Washington, DC. Both chambers are holding rare Sunday sessions to open […]

Senate Republicans have unveiled a new stimulus proposal to counter the plan offered by President Biden and congressional Democrats. And student loan borrowers are left out, again.

The pared-down proposal — which totals $618 billion, compared to the $1.9 trillion plan pushed by the White House — would include the following:

  • $160 billion for pandemic relief including vaccine distribution.
  • Federal unemployment benefits of $300 per month through June.
  • $40 billion for childcare and K-12 schools.
  • $1,000 in direct stimulus payments, limited to taxpayers earning less than $50,000 per year (or $100,000 for joint filers).

Not included in the proposal is any relief for student loan borrowers.

President Biden’s stimulus proposal includes much more expansive relief such as $1,400 stimulus checks to a broader swatch of taxpayers, extended federal unemployment benefits, a $15 per hour minimum wage, paid sick leave, and more robust investments in public health infrastructure and pandemic relief programs.

Notably, however, even President Biden’s stimulus plan excluded any relief for student loan borrowers.

On his first day in office, President Biden signed an executive order extending the existing moratorium on federal student loan payments, interest, and collections to September 30, 2021. Administration officials previously had indicated that Biden would push Congress to pass separate legislation for student loan relief, including $10,000 in student loan forgiveness for borrowers. Biden may also be able to enact further student loan relief through executive action, although he has publicly expressed reluctance to do so.

Consumer rights advocates were disappointed with the lack of any student loan relief and debt cancellation in Biden’s initial stimulus proposal. “The absence of a legislative request to cancel student debt heightens the urgent need for President-Elect Biden to cancel student debt administratively,” said a coalition of student borrower advocacy organizations in a statement last month. “We hope the absence of debt cancellation in this package is a clear indication that President-Elect Biden is planning to act quickly to use his authority to cancel student debt through executive action.”

Republicans have expressed opposition to Biden’s sweeping stimulus proposal, arguing that the plan is too expensive. Ten Republican senators signed on to the GOP counter-proposal, but Democratic congressional leaders responded with skepticism, suggesting that they could pass Biden’s plan without any Republican votes through budget reconciliation, which requires only a simple majority. Democrats hold narrow majorities in both the House and the Senate.

Further Reading

3 Reasons Why Biden Excluded Student Loan Relief From Stimulus – And What It Means For Borrowers

Biden’s Stimulus Proposal: No Student Loan Forgiveness

6 Student Loan Reforms That Are Possible With A Democratic Senate

Biden Names Replacement For Betsy DeVos — Student Loan Borrower Advocates Cautiously Optimistic

Ayanna Pressley: Biden Should Cancel $50,000 In Student Loan Debt For Every Borrower

Would Your Student Loans Be Eligible To Be Cancelled By Biden? It’s Complicated

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