The Congressional Budget Office (CBO) on Monday unveiled an analysis of President Joe Biden’s proposed changes to the income-driven repayment (IDR) program and estimated that the administration’s adjustments would cost the federal government $230 billion over the next 10 years.
The CBO report comes in response to an inquiry from Rep. Virginia Foxx (R-N.C.), chairwoman of the House Committee on Education and the Workforce, and Sen. Bill Cassidy (R-La.), ranking member of the Senate Health, Education, Labor and Pensions (HELP) committee. CBO estimated that if the final IDR rule from ED was unchanged from the proposed language, that it would increase the deficit in 2023 by $76 billion due to the modifications of existing loans, and over the 2023-33 period would cost an additional $154 billion for loans originated during that time.
Back in January, Foxx and Cassidy called on ED to extend the public comment period on the proposed IDR regulations by an additional 30 days, and took issue with costs associated with the proposed rules.
In response to Monday’s findings Cassidy again criticized the administration for embarking on a “reckless,” process separate from its efforts to cancel an additional, by CBO’s own estimates, $400 billion in student loan debt — a plan that is currently before the United States Supreme Court.
“President Biden’s IDR rule is not only irresponsible but deeply unfair to those who chose not to go to college or sacrificed to pay off their loans and will now have to foot the bill,” Cassidy said, arguing that the administration had “drastically underestimated the price tag of the rule.”
Meanwhile, Foxx on Monday said the proposed IDR rule “is nothing more than a backdoor attempt to provide free college by executive fiat.”
“Transferring $230 billion from borrowers who willingly took out debt to taxpayers who did not is fiscally irresponsible and morally reprehensible,” Foxx said in a statement. “Make no mistake, I soundly reject this illegal abuse of power.”
Publication Date: 3/14/2023