Fellow Conservative,
The national debt is hovering above $31 trillion. That is more dollar bills than there are stars in our galaxy. And the debt has been increasing at an alarming rate—our national debt is currently 500% larger than it was in 2000.
The last thing the country's economy needs is more debt, but Biden’s plan to restructure student’ loan payments would add over $100 billion to the debt.
Currently, under income-driven repayment plans, which are affordable by definition, borrowers pay about 10% of their discretionary income over about 20 years, and whatever’s left—including all accrued interest—is forgiven.
But the new rules dramatically change the calculus:
- Payments are generally cut in half from 10% to 5% of income
- The number of payments is generally cut in half from 20 years to 10 years
- And the income under which payments are reduced to $0 is raised from 150% to 225% of the poverty line
- All payments, including “payments” of $0, trigger cancellation of that month’s interest.
