Bill Overview
Title: Stop Reckless Student Loan Actions Act of 2022
Description: This bill limits executive authority to (1) suspend or defer federal student loan payments or interest accrual on such loans, and (2) cancel federal student loans. Specifically, the bill prohibits the President or the Department of Education (ED) from suspending or deferring federal student loan payments or the accrual of interest on such loans for borrowers with annual household incomes over 400% of the federal poverty line. Further, ED may only suspend or defer federal student loan payments or the accrual of interest for such loans for a total of 90 days after the declaration of a national emergency by the President. ED must submit recommendations to Congress on relief necessary for recipients of student financial-aid assistance. Additionally, the bill prohibits the President or ED from cancelling the outstanding balances or portions of balances on student loans due to the COVID-19 national emergency or any other national emergency. Executive or regulatory action to suspend or defer federal student loan payments or to cancel federal student loans shall be subject to congressional review. The bill also revises the definition of affected individual for purposes of the Higher Education Relief Opportunities for Students (HEROES) Act of 2003 to exclude from relief under the act (1) an individual who resides or is employed in an area that is declared a disaster area in connection with a national emergency; or (2) an individual who suffered direct economic hardship as a direct result of a war, military operation, or national emergency.
Sponsors: Sen. Thune, John [R-SD]
Target Audience
Population: People with federal student loans likely to be affected by national emergencies and expecting benefits from executive actions
Estimated Size: 43000000
- The bill impacts people who have federal student loans, especially those whose loans could be subject to suspension or deferment under existing executive authority.
- Borrowers with annual household incomes over 400% of the federal poverty line will be directly impacted, as they would be excluded from suspension or deferment benefits under this bill.
- Individuals who might have expected loan forgiveness or deferment due to emergencies like COVID-19 will be impacted since the bill limits such executive actions.
- The bill specifies a limit of 90 days for loan payment suspension or interest deferment during emergencies, affecting borrowers who might have benefited from longer deferment periods.
- The bill restricts executive authority, transferring more decision-making power to Congress regarding student loan relief measures.
- The bill impacts the definition of 'affected individual' under the HEROES Act, limiting relief provisions previously available for individuals impacted by emergencies.
Reasoning
- The policy primarily affects individuals with federal student loans who would have benefited from executive actions to suspend payments or cancel loans. This includes borrowers with different income levels, but notably impacts those above the 400% federal poverty line, who will not benefit from any payment suspensions or loans cancellation.
- To simulate a diverse set of interviews, it is important to include individuals of varying ages, occupations, and economic backgrounds, as long as they are representative of the group likely to be affected by student loan policies.
- A range of viewpoints is included, from those directly impacted by losing anticipated loan relief to those unaffected by this restriction, reflecting diverse personal and economic perspectives.
- The budget constraints mean that only a portion of the overall affected population can directly interact with the policy in actionable terms, suggesting scenarios of 'high' to 'none' impact, spanning a range of potential durations.
- Some participants will not experience prolonged changes in their wellbeing scores owing to the policy limits, since it leaves out certain segments of borrowers.
Simulated Interviews
Marketing Manager (New York City, NY)
Age: 32 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 5/20
Statement of Opinion:
- I'm disappointed with the policy because it doesn't help people like me who have higher incomes but are still struggling with loan repayments.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 5 | 6 |
| Year 3 | 5 | 6 |
| Year 5 | 6 | 7 |
| Year 10 | 6 | 7 |
| Year 20 | 6 | 7 |
Software Engineer (Los Angeles, CA)
Age: 24 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 10/20
Statement of Opinion:
- The policy doesn't really affect me because I'm still within the income threshold to qualify for deferments.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 8 |
| Year 20 | 7 | 8 |
Professor (Houston, TX)
Age: 50 | Gender: other
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 8/20
Statement of Opinion:
- This policy makes it tough for middle to upper-middle-class families who have accumulated debt to support their kids through college.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 7 | 8 |
| Year 5 | 7 | 8 |
| Year 10 | 7 | 8 |
| Year 20 | 7 | 8 |
Freelance Graphic Designer (Chicago, IL)
Age: 28 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 0.0 years
Commonness: 12/20
Statement of Opinion:
- I appreciate the emergency deferments, as they provide some breathing room during tough financial times.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 4 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 7 |
| Year 20 | 6 | 7 |
Construction Worker (Topeka, KS)
Age: 40 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 0.0 years
Commonness: 3/20
Statement of Opinion:
- Given my income level, the changes don’t seem to affect me, thankfully.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 7 |
| Year 10 | 6 | 7 |
| Year 20 | 6 | 7 |
Registered Nurse (Miami, FL)
Age: 30 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 4/20
Statement of Opinion:
- This policy feels like it adds unnecessary stress to already high stress fields like healthcare, where we need to feel supported.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 5 | 6 |
| Year 3 | 5 | 7 |
| Year 5 | 5 | 7 |
| Year 10 | 6 | 8 |
| Year 20 | 6 | 8 |
UX Designer (Seattle, WA)
Age: 26 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 6/20
Statement of Opinion:
- Higher income doesn’t mean I don’t feel the squeeze of these loans. The policy feels like it doesn't support those achieving higher income.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 6 | 7 |
| Year 5 | 6 | 8 |
| Year 10 | 7 | 8 |
| Year 20 | 7 | 8 |
Graduate Student (Boston, MA)
Age: 22 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 8/20
Statement of Opinion:
- Knowing that there won't be broad cancellations makes me nervous about my financial future once I graduate.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 7 |
| Year 3 | 6 | 7 |
| Year 5 | 6 | 7 |
| Year 10 | 7 | 8 |
| Year 20 | 7 | 8 |
Public School Teacher (Atlanta, GA)
Age: 35 | Gender: other
Wellbeing Before Policy: 5
Duration of Impact: 0.0 years
Commonness: 15/20
Statement of Opinion:
- Public servants need relief too, and limiting options for deferment makes it even harder.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 6 |
| Year 3 | 5 | 6 |
| Year 5 | 6 | 7 |
| Year 10 | 6 | 7 |
| Year 20 | 6 | 7 |
Farmer (Rural Nebraska)
Age: 60 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 12/20
Statement of Opinion:
- This doesn't really affect me or my family, since we managed to keep college debts low.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Cost Estimates
Year 1: $15000000 (Low: $10000000, High: $20000000)
Year 2: $15000000 (Low: $10000000, High: $20000000)
Year 3: $15000000 (Low: $10000000, High: $20000000)
Year 5: $5000000 (Low: $3000000, High: $7000000)
Year 10: $1000000 (Low: $500000, High: $1500000)
Year 100: $0 (Low: $0, High: $0)
Key Considerations
- The assumption of economic stability and no significant further emergencies that might necessitate widespread loan deferment.
- Potential public backlash resulting from more restricted access to relief during emergencies relative to previous policies.
- Impact on borrowers' ability to repay loans in the absence of deferral and forgiveness options when facing economic hardship.