House Republicans demand answers from CBO after ‘miscalculating’ budget for $500 billion student loans program | SehndeWeb

FIRST ON FOX: House Republicans are calling on the Congressional Budget Office (CBO) to provide information on how it “miscalculated” the costs of the federal student loan program associated with the Health Care Reconciliation Act and education.

Signed into law in 2010 by former President Obama, the measure, which included a federally backed student loan program, was expected to save taxpayers $40 billion to $62 billion from 2010 through 2020. However, in 2019, the CBO released a new projection and said the program would cost taxpayers $31.5 billion over the next ten years.

Rep. Warren Davidson, R-Ohio, and members of the House Freedom Caucus hold a press conference outside the Capitol on Dec. 3, 2020. (Tom Williams/CQ-Roll Call, Inc via Getty Images/Getty Images)

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In a letter sent Friday to CBO Director Phillip Swagel, 15 House Republicans asked for the formulas used by the agency that led to the miscalculation and resulted in taxpayers paying more than $400 billion for creating the program.

The letter highlights an internal analysis conducted by the Department of Education in 2020 that assessed $1.37 trillion in student loans held by the federal government. The department concluded, as stated in the letter, that borrowers would repay $935 billion of those loans, leaving taxpayer money to fund the remaining $435 billion.

“The CBO miscalculated the cost of the $503 billion Health and Reconciliation Act, before factoring in President Biden’s student loan bailouts,” the Republicans wrote. “Congress might not have passed this bill if the CBO had noted it appropriately. Congress needs an updated, accurate, and transparent estimate from the CBO so it can fix our student loan programs in the future.”

Additionally, Republicans said in the letter that it was important for Congress and members of the public “to have access to disclosures about the data, programs, models, assumptions and other details that the CBO uses to estimate the cost.” of legislation”.

The agency used the same formulas in 2019 that it used before the measure became law to calculate the budget impact of the program and came to different conclusions.

Philippe Swagel

Director of the Congressional Budget Office Phillip Swagel testifies before the Legislative Branch Subcommittee of the House Appropriations Committee during a hearing at the United States Capitol on February 12, 2020 in Washington, D.C. (Sarah Silbiger/Getty Images/Getty Images)

Led by Rep. Warren Davidson, R-Ohio, the letter also asked the agency to release a new projection on the cost of the measure, including “the total projected cost of these student loan programs to taxpayers,” and insisted that “transparency is necessary to ensure accuracy and confidence in CBO reporting.”

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“Due to CBO’s miscalculation, taxpayers are liable for an unexpected $435 billion,” Davidson said in a statement to Fox News Digital. “Biden’s call to cancel student loan debt and appease the radical left only shifts more costs onto hard-working Americans. Congress needs accurate analysis so we can fix the federal program student loans in the future.”

Federal student loan payments were first suspended in May 2020 under former President Donald Trump. But as the economy emerged from the pandemic, President Biden extended that pause several times after taking office, drawing criticism from Republicans.

Joe Biden

President Biden speaks during an event at the South Court Auditorium on the White House campus on February 22, 2021 in Washington, D.C. (AP Photo/Evan Vucci/AP Newsroom)

It was reported this week that Biden told members of Congress that he was considering options to cancel student loans through executive action.

Speaking about the pause in loan repayments, White House press secretary Jen Psaki said Tuesday that executive action by the president is on the table.

“He will make a decision before this break is over,” Psaki said. “At the moment it has been extended until August … and it is looking at other options for executive authority.”

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Progressives are pushing Biden to write off student loan debt completely by executive order. They say the crippling debt hanging over the heads of many college graduates forces them to put off major life decisions and that student debt disproportionately affects minorities.

On Wednesday, Fox News reported that Senate Minority Whip John Thune and a group of GOP Senators would introduce a bill to stop Biden from writing off student debt amid news Biden is considering proposals to write off outstanding student loans.

Fox News’ Tyler Olson contributed to this article.

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