In an announcement video posted to X, Department of Education Secretary Linda McMahon announced that beginning August 1, the Department of Education will resume charging interest on student loans under the Saving on a Valuable Education (SAVE) Plan enacted under former President Joe Biden. That plan was ruled an unconstitutional overreach of power by the United States Supreme Court in June 2023.
The Biden administration introduced the SAVE Plan in the summer of 2023 and billed it as an affordable repayment program, but it was legally challenged and is now defunct. Critics argued in editorials that it was “straight up buying votes.” a blatant attempt to buy votes for the Democratic Party.
This change marks a broader overhaul of the federal student loan system under President Trump’s administration, which will phase out the SAVE Plan and other income-driven repayment plans that claimed to eliminate or lower payments for borrowers, but in practice handed the bill to American taxpayers.
The Trump administration’s view on the issue is that loan cancellations are “vile” and are not a viable option as it merely shifts debts from one party to another, specifically not allowing American taxpayers to take on debts that are not their own.
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Author: Ray Hilbrich
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