PRESS RELEASE: Higher Education Finance Reform Coalition Calls on Biden Administration to End Plans for Backdoor Student Loan Cancellation
WASHINGTON—In a letter to the U.S. Department of Education, a coalition of higher education finance reform experts led by the Defense of Freedom Institute for Policy Studies (DFI) is calling on the Biden administration to withdraw its proposed regulations on Income-Driven Repayment (IDR). The administration’s estimate of the proposed IDR rule’s enormous costs differs substantially from those calculated by the nonpartisan Congressional Budget Office (CBO).
The IDR plan is estimated by the independent CBO to cost taxpayers more than $230 billion—nearly $100 billion more than the Biden administration disclosed in its Notice of Proposed Rulemaking (NPRM) released in January.
“In its rush to regulate, the Biden administration has ignored its obligation to the public to provide good faith estimates of the costs imposed by its ill-considered regulatory proposal, which is nothing more than backdoor student loan cancellation,” said DFI President and Co-Founder Bob Eitel. “This abuse of executive authority will cost hardworking taxpayers hundreds of billions of dollars and result in regulations that will severely aggravate the problem of ever soaring college tuition. The administration should withdraw the IDR NPRM and start over.”
The coalition letter states, “The Department’s failure to provide adequate analyses of the costs of the IDR NPRM deprived interested members of the public of the opportunity to offer input on a more accurate estimate of the program’s costs and its impacts on the budget, higher education, and the American economy. The desire to make a program more politically palatable by arbitrarily affixing a price tag almost 70 percent lower than its true cost is not a basis for reasoned rulemaking; it is antithetical to the intent of the rulemaking process. Rather than issue a final rule based on a flawed IDR NPRM and notice-and-comment process, we urge the Department to withdraw the NPRM.”
Last February, several members of the DFI-led coalition also sent a letter requesting that the Department provide at least an additional 30 days for the public to comment on the IDR NPRM. The letter argued that the 30-day public comment period did not provide sufficient opportunity for the public to weigh the NPRM’s implications and specifically cited the Department’s projected cost of the IDR NPRM as “a compelling reason to extend the comment period,” warning that the Department was significantly underestimating the proposal’s costs. The CBO estimate underscores the concerns set forth in the coalition’s February letter.
To read the April 25th letter to the Biden administration, click here.
On Tuesday, May 2, 2023, DFI, The Foundation for Research on Equal Opportunity, the Urban Institute, the Texas Public Policy Foundation, and The Heritage Foundation will host a policy and legal discussion on the Biden administration’s IDR NPRM entitled “Income-Driven Repayment Overhaul: The Backdoor Student Loan ‘Forgiveness’ the Media Isn’t Talking About.” Members of the media interested in attending, in-person or virtually, can register here.
Coalition Members Signing the Letter Include:
Robert S. Eitel
President and Co-Founder
Defense of Freedom Institute for Policy Studies
Lindsey Burke, Ph.D.
Director, Center for Education Policy and Mark A. Kolokotrones Fellow in Education
Former Senior Advisor to the Under Secretary
U.S. Department of Education
President & General Counsel
New Civil Liberties Alliance
Chief Government Affairs Officer
American for Prosperity Foundation
Andrew Gillen, Ph.D.
Senior Policy Analyst
Texas Public Policy Foundation
Rea S. Hederman Jr.
Vice President of Policy
The Buckeye Institute
Steve Taylor, D.B.A.
Founder and Principal
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