Trump looks to kill student loan forgiveness program

As student debt continues to climb, President Donald Trump on Monday released a budget for 2021 that would slash many of the programs aimed at helping borrowers.

Student loan spending would be cut by $170 billion in Trump’s plan, titled “A Budget for America’s Future.” The reductions include “sensible annual and lifetime loan limits” for graduate students and parents and the end to subsidized loans, in which the government covers the interest for borrowers who are still in school or experiencing economic hardship.

It would also reduce the number of repayment options for borrowers and nix the popular, if challenged, public service loan forgiveness program.

That program, signed into law by President George W. Bush in 2007, allows not-for-profit and government employees to have their federal student loans canceled after 10 years of on-time payments. The Consumer Financial Protection Bureau estimates that up to one-quarter of American workers are eligible.

“The Trump Administration already has a reputation of being anti-borrower,” said Mark Kantrowitz, a higher education policy expert. “This just takes it further.”

In all, Trump’s proposal would request $66.6 billion for the U.S. Department of Education, trimming the budget by $5.6 billion, or nearly 8%. The proposed cut is less steep than last year, when he called for a nearly 10% reduction in spending for the department.

Still, any cuts to student loan relief programs are unlikely to sit well with many voters.

Eighty percent of Americans agree that the government should make it easier for people with student debt to repay their loans, a study by The Pew Charitable Trusts found. Another poll found that nearly 60% of registered voters said they would support a plan to cancel all existing student loan debt.

Meanwhile, leading Democratic presidential candidates on the campaign trail are vowing to cancel the majority or all of the country’s outstanding student loan debt.

Bernie Sanders has proposed wiping out the country’s $1.6 trillion outstanding student loan tab.

Elizabeth Warren’s plan would cancel $50,000 in student debt for borrowers with household incomes of less than $100,000. People who earn between $100,000 and $250,000 would be eligible for forgiveness on a sliding scale.

https://www.cnbc.com/2020/02/10/trump-proposes-end-to-student-loan-forgiveness-program.html

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39575630)

Fuck this kike nut sucking faggot boomer

Sanders has my vote not flame

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39575638)

*Bannon breakdancing in corner*

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39575641)

the whole 'BANNON populism' promise has been utterly irrelevant from day 1. they ran him out of the administration within 9 months and filled the whole place with Jeb retreads.

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39575660)

Fuck this FAGGOT MASONIC JAHBULON COCK SUCKING PEDO FUCKING COUNTRY

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39575670)

'Trump states' -- as though 101% of Trump voters are HS dropout HVAC techs who are now entirely economically secure for all time under the TRUMP ECONOMIC MIRACLE! this is idiotic reasoning.

student debt affects middle/working-class Trump voters.

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39575694)

Of course that hasn't happened, and either will this. It's a proposal to congress that they will ignore.

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39575895)

That being said - Trumpmos, this is what your boy actually thinks of you

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39575893)

Populist MAGA emperor will happily drop billions for tax cuts for GC or funding Israel defense.

Loan forgiveness? Let them eat cake.

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39575899)

:^)

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39576434)

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39576416)

Why not have a tax on endowments that ratchets downward as the sticker price for school goes below certain levels (tuition + room & board)?

So for example, have an annual endowment tax of 20% that ratchets down to 0% if total yearly student costs are below $10k or something.

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39576451)

These ideas make too much sense.

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39576625)

So for example, perhaps the govt gives you $0 for a school where sticker cost > $50k, $5k where sticker is $25k, and the full amount where sticker is < $10k. You could have it be a sliding scale all the way down.

Then students can say hey, why does this cost so much?

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39576680)

LJL

I can't believe what is considered "public service" these days.

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39578436)

Literally you could make the same argument for taxes. You raised my taxes and I could have sold two years ago at lower so give me my lower tax rate!

Nope - sorry. Pay what you OWE

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39585802)

Public Service Loan Forgiveness and Breach of Contract Claims

Equal Justice Works

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Contributor

Helping Lawyers Help Community

12/07/2016 03:31 PM ET

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Updated Mar 07, 2017

When a current borrower acquired a Federal Direct Loan from the federal government, the borrower signed a Master Promissory Note (“MPN”) which promised, among other things, eligibility for Public Service Loan Forgiveness (“PSLF”) upon the completion of certain conditions. In short, the current borrower maintains a contract with the federal government for PSLF. So if Congress passed a law that disrupted a contractual promise, i.e. PSLF, with current borrowers, does a claim for breach of contract exist?

When the government is a party to a contract, it is known as a “public contract” (as opposed to a “private contract”) and special rules apply. First, according to the Supreme Court, the government must consent to being sued, even in the event the government breaches a contract. The Tucker Act serves as the federal government’s consent to being sued for breach of contract. However, that statute only allows the government to consent to being sued for money damages, and thus the government cannot be compelled to complete a breached contract or required to stop the activity that led to the breached contract.

Second, the government has “sovereign defenses” that are not available to non-government parties. The two primary “sovereign defenses” are the (1) unmistakability doctrine, and (2) sovereign acts doctrine.

The two sovereign defenses, while technically separate defenses, typically work hand-in-hand. This is because courts will, in most cases, examine the defenses together. The way that these defenses work is best understood with an example.

David is a current borrower with loans covered by an MPN promising PSLF. In 2017, Congress passes an act repealing PSLF for current borrowers. This same year, David satisfies the requirements for PSLF and seeks to have his remaining loans forgiven. His request is denied. David then files a lawsuit in federal court alleging that the federal government has breached their contract with David by failing to forgive his loan balance. As usually happens, the federal government admits they breached the contract but argues that David is ineligible for damages because of ”sovereign defenses.”

The federal court in their analysis would first apply the “sovereign acts doctrine” defense. This defense would bar David’s claim if the government could prove that Congress’ new law is a “sovereign act.” A “sovereign act” is a law that is “public and general,” i.e. (1) designed to benefit the public welfare, (2) not designed to or does not have the primary effect of helping the government avoid its contractual obligations to current borrowers under PSLF, and (3) does not place the majority of the impact of the law on current borrowers under contract with the federal government.

If the court determined the law to not be a “sovereign act,” then the court would ignore the “unmistakability doctrine” defense, and allow David to proceed with his claim. While a court could decide either way on the issue, recent case law does exist where courts have held that new laws affecting repayment provisions on existing loan contracts to not be “sovereign acts.”

However, if the court determined the law to be a “sovereign act,” then the court would proceed with an analysis under the “unmistakability doctrine” defense. Under this defense, the court would look at David’s MPN to see whether or not the contract contained a provision that “unmistakably” confirmed that the government intended that the terms of the agreement not be affected by future laws. As no MPNs contain such a provision, the “unmistakability doctrine” defense would likely bar David’s contract claim from moving forward.

All in all, the reality is this: The Tucker Act makes the government eligible for breach of contract claims for damages. In the event Congress passes a law removing PSLF for current borrowers, and thus breaching MPNs, the success or failure of a borrower’s ability to bring such a claim likely comes down to whether or not courts consider such a law to be a “sovereign act.”

Equal Justice Works helps support public interest attorneys and law students learn more about income-driven repayment plans and PSLF. We have a debt relief newsletter, free student debt webinars, and a free student debt e-book, Take Control of Your Future.

Kenneth Strickland is the Student Debt Specialist at Equal Justice Works, where he works to ensure that public interest legal jobs remain accessible to all who desire them through engaging in education, outreach, and policy analysis centered around ensuring that an affordable legal education remains an option for everyone. Ken is a recent graduate from the University of North Carolina School of Law, and has worked with reputable public service organizations such as North Carolina Advocates for Justice, American Civil Liberties of North Carolina, and the North Carolina Poverty Research Fund.

This post was published on the now-closed HuffPost Contributor platform. Contributors control their own work and posted freely to our site. If you need to flag this entry as abusive, send us an email.

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39585901)

Democratic presidential candidate Mike Bloomberg on Tuesday released a new $700 billion higher education plan that calls for free community college and doubling Pell Grants for low-income students.

The former New York City mayor's proposal would significantly increase federal spending on higher education and aims to target those subsidies to lower-income families. It doesn’t go as far as proposals by other Democrats to eliminate tuition at public, four year universities for large swaths of students or provide student loan forgiveness on the scale that progressives have sought.

Bloomberg would eliminate tuition at community colleges for all students, embracing a proposal President Barack Obama first made in 2015 and that has since become a key pillar of Democratic higher education plans.

The plan also calls for making community college and four-year public colleges “debt-free” for low-income students, meaning they would not have to take out loans to finance tuition or other costs like books, food and transportation. The benefit would be available to families that earn, on average, less than $30,000 a year, according to the Bloomberg campaign.

https://www.politico.com/news/2020/02/18/mike-bloomberg-community-college-student-loans-115703

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39613822)

Trump can be criticized on this front as well. No one has any interest in going after higher ed costs even though its a winning issue with millenials.

(http://www.autoadmit.com/thread.php?thread_id=4442288&forum_id=2Ã#39613967)