[Congressional Record Volume 167, Number 35 (Wednesday, February 24, 2021)]
[Senate]
[Pages S839-S840]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
Student Loan Debt
Mr. THUNE. Mr. President, earlier this month, 16 Democratic Senators
introduced a resolution calling for President Biden to forgive $50,000
of Federal student loan debt per borrower--$50,000.
There is no question that student loan debt is a problem for many
Americans. College costs have risen to unrealistically high levels, and
many students or their parents take out unrealistic amounts of debt in
response. But the answer to this problem is not to have the President
or Congress simply step in and forgive a large chunk of student loan
debt.
To start with, Democrats' plan is incredibly, fundamentally unfair.
Right now, there are individuals around this country who have just paid
off the last of their student loans. They have been working hard,
making payments, sometimes for a couple of years, sometimes for a
couple of decades, as was the case with me. What happens to these
individuals if the President steps in and forgives $50,000 of student
debt? Well, I will tell you what happens--nothing. These individuals
who have worked hard for years to pay off their debt will see no
benefit from the Democrats' blanket loan forgiveness. Meanwhile, other
Americans who have made no more than a month or two of payments will
see their student loans entirely disappear. That is incredibly unfair.
In addition to being unfair, forgiving student loan debt does
absolutely nothing to address the problems that created this debt
crisis in the first place. In fact, the Democrats' solution is likely
to make things worse.
What possible incentive will students have to take the responsible
approach to borrowing if they think the Federal Government will step in
and solve their debt problem? What incentive will colleges have to
restrain tuition growth if they think they can rely on the Federal
Government to subsidize their students' tuition fees through loan
forgiveness?
Forgiving $50,000 in student loans would also set a terrible
precedent on the sanctity of contracts. While it may at times be ill-
advised, students freely enter into the agreements they make when they
take out a loan. Should we really be teaching that agreements and
contracts mean nothing, that people can incur debt and then not have to
pay it off? And about that ``not paying it off,'' the phrase ``student
loan forgiveness'' carries with it a suggestion that these debts will
just disappear, that $50,000 can be wiped off each American's slate and
vanish into the ether.
But, of course, we know that is not the case either. This is money
students have borrowed from the Federal Government, and if the
Government doesn't get that money back, the Government will be facing
an unexpected debt.
Now, some people, especially some Democrats, tend to talk as if the
Government draws on an unlimited pot of money, but, of course, we know
that is not true. Government funds aren't anywhere close to being
unlimited, and Government coffers are not filled from a pot of gold at
the end of the rainbow. They are filled by taxpayer dollars, and,
sooner or later, it will be taxpayers who foot the bill for any loan
forgiveness program, including the many taxpayers who opted not to
attend college or chose a debt-free way of doing so. There are a lot of
Americans out there who saved up to get a degree or went part-time to
avoid incurring debt. Are they really supposed to foot the bill for
other Americans' student loans?
While you might think that Democrats' plan is largely targeted to
low-income or disadvantaged individuals, that is not actually the case.
Under the Democrats' plan, an American making $20,000 and an American
making $120,000 would receive the same loan relief. In fact, since more
loan dollars are held by those in higher income brackets, higher income
Americans could end up benefiting the most. And that brings up another
thing that we need to remember.
Yes, a number of Americans carry a significant amount of student loan
debt, but some of those Americans have incurred that debt for a career
that will bring significant financial rewards.
Plus, a substantial portion of student loan debt is not for
undergraduate degrees but for graduate and professional degrees. Under
the Democrats' student loan forgiveness proposal, taxpayers could be
subsidizing not just bachelor's degrees but master's degrees and Ph.D.
degrees, as well as law and medical degrees.
Instead of putting taxpayers on the hook for billions, we should be
focused on exploring ways to drive down education costs and educate
students on the dangers of taking on excessive debt.
We should also be highlighting affordable education options like our
Nation's community and technical colleges. These colleges, like the
outstanding institutions we have in South Dakota, provide students with
associate's degrees, certificates, apprenticeships, opportunities to
learn a trade, and more.
There are also things we could do to help students pay off loans
without putting taxpayers on the hook for such massive amounts of
money. In December, Congress passed a 5-year legislation that I
introduced with Senator Warner to allow employers to help employees
repay their loans. Our Employer Participation and Repayment Act amends
the Educational Assistance Program to permit employers to make tax-free
payments on their employees' student loans.
Previously, employers could make tax-free contributions to their
employees' tuition if their employees were currently taking classes,
but they
[[Page S840]]
couldn't provide tax-free contributions to help employees with
education debts that they had already incurred. Our bill allows them to
make tax-free contributions to help with employees' already existing
student loan debt. That is a win-win situation. It is a win for
employees who get help paying off their student loans, and it is a win
for employers who have a new option for attracting and retaining
talented workers.
Our bill is not a silver bullet, but it will certainly help ease the
pain of paying back student loans for a number of young Americans. I am
pleased it was enacted into law for a 5-year period, and I hope
Congress will act to make it permanent.
Another big thing we could do is make sure that graduates have access
to good-paying jobs. This is key to enabling people to pay off their
debt, and we should resolve to build on the economic progress that we
had made prepandemic and focus on policies that will allow our economy
to grow and to thrive.
High college costs and student debt are a problem, but blanket loan
forgiveness is not the answer. I hope that President Biden will resist
Democratic calls to put taxpayers on the hook for literally billions
and billions of dollars in student loans.
I yield the floor.
I suggest the absence of a quorum
The ACTING PRESIDENT pro tempore. The clerk will call the roll.
The bill clerk proceeded to call the roll.
Mr. BOOZMAN. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.