The Education Department and consumer advocates warned this week how devastating the House Republican debt ceiling plan would be for student borrowers and those seeking higher education, YahooFinance.com reported. The plan would reverse the president’s student loan forgiveness up to $20,000 even if the Supreme Court rules in favor of its legality in the next months. It would also cancel the creation of a more affordable student loan payment plan. Overall, the Education Department would see a 22% reduction in funding, the department said Tuesday, which would shrink the Pell Grant program that helps lower-income students afford college. The proposal, which House Speaker Kevin McCarthy tweaked Tuesday evening in an effort to wrangle enough votes among the GOP to pass the House, comes as the Treasury continues to move money around to keep the federal government from defaulting on its debt. Those maneuvers could stop working sooner than expected — as early as mid-June — if capital gains revenue continues to come in weaker than expected, Yahoo Finance previously reported. A default could shake the markets and send ripple effects through the economy. President Joe Biden has already promised a veto, with the White House pointing to a recent Moody’s Analytics report that found the bill would cut into near-term economic growth if enacted.
