Bill Overview
Title: Student Loan Accountability Act
Description: This bill generally prohibits the Departments of Education, Justice, or the Treasury from taking any action to cancel or forgive the outstanding balances, or portion of balances, of covered loans. Covered loans refer to Federal Family Education Loans, Federal Direct Loans, Federal Perkins Loans, and loans under the Health Education Assistance Loan Program. The prohibition does not apply to targeted federal student loan forgiveness, cancellation, or repayment programs that are in effect by final regulation on May 11, 2022, and carried out under the Higher Education Act of 1965.
Sponsors: Sen. Romney, Mitt [R-UT]
Target Audience
Population: Citizens with federal student loans
Estimated Size: 43000000
- Federal student loans impact those who have borrowed money for their education in the United States.
- Around 43 million borrowers in the U.S. have federal student loans.
- Globally, the impact is limited as federal student loans are primarily a U.S. policy.
- Those with specific loan types like Federal Family Education Loans, Federal Direct Loans, and others will be directly impacted.
- The global number is small because U.S. education loans are largely domestic.
Reasoning
- The proposed policy primarily affects individuals with federal student loans, approximately 43 million borrowers in the U.S.
- The budget limitation suggests that any effects on wellbeing would likely be indirect unless individuals expect or rely on potential future forgiveness.
- The policy impact is largely dependent on borrowers' current reliance on forgiveness prospects, the size of their debt, and their career trajectories.
- While some borrowers might experience a sense of stability knowing existing specific forgiveness paths remain unchanged, others might feel increased stress due to the prohibition of broad forgiveness measures.
Simulated Interviews
Marketing Manager (Chicago, IL)
Age: 32 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 5/20
Statement of Opinion:
- I'm working hard to pay off my student loans and was hoping for some broad relief, but I'm glad targeted forgiveness isn't affected.
- I think it's critical to have transparent policies so I'm not counting on something that won't happen.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Software Developer (Denver, CO)
Age: 28 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 6/20
Statement of Opinion:
- This policy makes me uneasy because I was hoping for some forgiveness to help me with my high debt.
- Any hint of forgiveness being potentially off the table increases my stress, especially with my upcoming marriage.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 5 |
| Year 2 | 4 | 5 |
| Year 3 | 4 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 6 | 6 |
Public School Teacher (Los Angeles, CA)
Age: 45 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 20.0 years
Commonness: 4/20
Statement of Opinion:
- I'm happy that the targeted forgiveness via PSLF isn't impacted by this policy.
- The broader aspect of not having loan balances canceled isn't too relevant for me personally.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Graphic Designer (Austin, TX)
Age: 24 | Gender: other
Wellbeing Before Policy: 6
Duration of Impact: 3.0 years
Commonness: 8/20
Statement of Opinion:
- I've just started my career and wasn't really counting on any forgiveness, so the impact is minimal for me.
- I think it's more important to focus on job opportunities and salary growth.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Registered Nurse (Miami, FL)
Age: 37 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 15.0 years
Commonness: 3/20
Statement of Opinion:
- I rely on targeted forgiveness programs being steady and available, so I'm relieved they're unaffected.
- The policy doesn't change my personal financial strategy much.
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 |
Administrator at University (New York, NY)
Age: 50 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 0.0 years
Commonness: 7/20
Statement of Opinion:
- The policy is more of interest for my kids since I don't have loans myself anymore.
- I'm interested in how future policies might affect education costs for my children.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Recent College Graduate (Seattle, WA)
Age: 22 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 4/20
Statement of Opinion:
- I'm a bit disappointed as I was really hoping for some help with my federal loans. This adds to my stress when looking for a job.
- I suppose relying on forgiveness wasn't a sure plan, but it was a hopeful possibility.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 5 |
| Year 2 | 4 | 5 |
| Year 3 | 4 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 6 | 6 |
| Year 20 | 6 | 6 |
Small Business Owner (Houston, TX)
Age: 40 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 3/20
Statement of Opinion:
- I hoped for some debt relief to ease current cash flow issues, so the news is a little disappointing.
- I'll need to rethink my payment strategies once more economic stability returns.
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 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 7 | 7 |
Technical Advisor (Phoenix, AZ)
Age: 55 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 6/20
Statement of Opinion:
- The policy doesn't impact me directly since I'm past my student loan years.
- I'm more focused on financial planning for my children.
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 |
Freelance Writer (Portland, OR)
Age: 30 | Gender: other
Wellbeing Before Policy: 4
Duration of Impact: 10.0 years
Commonness: 4/20
Statement of Opinion:
- With the gig economy, my payments are hard to keep up with and I was banking on hopes of forgiveness at times.
- This policy means I definitely need to make more consistent income to manage these payments.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 3 | 4 |
| Year 2 | 3 | 4 |
| Year 3 | 3 | 4 |
| Year 5 | 4 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 5 |
Cost Estimates
Year 1: $5000000 (Low: $3000000, High: $7000000)
Year 2: $5000000 (Low: $3000000, High: $7000000)
Year 3: $5000000 (Low: $3000000, High: $7000000)
Year 5: $5000000 (Low: $3000000, High: $7000000)
Year 10: $5000000 (Low: $3000000, High: $7000000)
Year 100: $5000000 (Low: $3000000, High: $7000000)
Key Considerations
- The bill aims to ensure consistency in the federal government's approach to loan forgiveness, limiting fiscal exposure.
- It preserves existing targeted forgiveness programs, which remain intact, allowing continued support for specific groups of borrowers.
- The policy may face legal challenges relating to the balance of power and executive agency discretion.