Education Department: Biden’s student loan repayment plan to be terminated
The Trump administration is poised to strike down a Biden-era scheme to shift student loan repayment burdens onto American taxpayers.
‘The law is clear: if you take out a loan, you must pay it back,’ said Undersecretary of Education Nicholas Kent.
The Department of Education has announced that it will be slashing a program that would force American taxpayers to repay college students’ loans.
The “Saving on a Valuable Education” (SAVE) Plan was introduced during the Biden administration with the aim of paying off student loans by calculating monthly payments for borrowers based on their family size and income.
Yet, according to a Dec. 9 press release by the Trump administration’s Department of Education, the plan was not only illegal but also misled millions of borrowers and shifted the burden of payments onto the American taxpayer.
Undersecretary of Education Nicholas Kent said that “For four years, the Biden Administration sought to unlawfully shift student loan debt onto American taxpayers, many of whom either never took out a loan to finance their postsecondary education or never even went to college themselves, simply for a political win to prop up a failing Administration.”
Kent made clear that “The law is clear: if you take out a loan, you must pay it back.”
The Biden administration began early-implementing provisions of the plan in Feb. 2024. Two months later, then-Missouri Attorney General Andrew Bailey filed a lawsuit challenging the plan, which was the prior administration’s third attempt.
On Tuesday, the Trump administration struck a settlement with Missouri to dismiss ongoing litigation regarding the plan. In exchange, the Education Department would not enroll any new students into the SAVE program.
Current Missouri Attorney General Catherine Hanaway reflected on the state’s efforts. “Our Office fought for hardworking Americans who were being preyed upon by Biden Administration bureaucrats, and we won in court every time,” she said.
“Unilaterally saddling taxpayers with someone else’s Ivy League debt ignored Congressional authority and was clearly unlawful,” she continued. “We appreciate President Trump’s real, long-term solutions instead of illegal student loan schemes.
Campus Reform Higher Education Fellow and Suffolk Community College Professor Nicholas Giordano said that “The Biden era SAVE Plan was always a gimmick dressed up as compassion, but in reality it was a backdoor attempt to shift student loan debt from borrowers to hardworking taxpayers.”
”If a borrower is still unable to earn enough to meet basic loan obligations after a few years, it serves as an indictment on the entire higher education system,” he explained. “Colleges have spent years inflating tuition, creating ineffective degree programs, and watering down academic standards.”
”The SAVE plan is nothing more than a bailout to these institutions, and it was an attempt to allow them to escape their culpability in the student loan crisis,” Giordano concluded.
