Mitch McConnell slams Biden's student-loan payment pause extension: 'We ought to remind people that we all pay our debts'

  • Sen. Mitch McConnell criticized Biden's extension of the student-loan payment pause on Fox News.

  • He said, "we ought to remind people that we all pay our debts."

  • Republican lawmakers have slammed the extension, saying it will cost taxpayers and the economy.

The Senate Minority Leader doesn't think student-loan borrowers should continue getting relief.

"I think in this country we ought to remind people that we all pay our debts," Mitch McConnell told Fox News on Sunday.

"And with regard to extending the moratorium, quoting Larry Summers again, he said it's exactly the wrong thing to do in the middle of this overheated economy, reducing this rapid inflation," McConnell added. "This administration just can't seem to get their act together on the economy."

McConnell was likely referring to a tweet from Larry Summers, a lead economist for former President Barack Obama, who wrote that another extension of student-loan relief is "regressive, uncertainty creating, untargeted and inappropriate at a time when the economy is overheated."

Last week, President Joe Biden extended the pause on student-loan payments, with waived interest, through August 31. It's the fourth time he's extended while in office. First implemented by former President Donald Trump as a form of pandemic relief, the pause was intended to give federal borrowers financial breathing room as they dealt with the impact of COVID-19. While Biden answered the calls of many Democratic lawmakers who were pushing for another extension, Republicans argued that with inflation on the rise, continuing to pause payments will only hurt taxpayers and the economy, criticizing broad relief measures.

For example, as Insider reported, Republican lawmakers have long been urging Biden against not only another extension of the payment pause, but broad student-loan forgiveness, as well. Rep. Virginia Foxx, the top Republican on the House education committee, called the latest extension "outrageous" and said she worried it was "setting the stage for blanket loan forgiveness."

Arkansas Sen. Tom Cotton wrote on Twitter that Biden's "perpetual student loan payment moratorium is an insult to every American who responsibly paid debts."

—Tom Cotton (@TomCottonAR) April 5, 2022

Republicans have cited the $150 billion cost to taxpayers in the form of lost federal revenue with the previous student-loan pauses, and some of them also said that further relief should not still be tied to the pandemic, going so far as to introduce legislation that would block the Education Secretary from using the pandemic as a reason why an extension of the payment pause is warranted.

Democratic lawmakers have argued the opposite. Many of them have maintained that broad student-loan relief would stimulate the economy, and they said it's a cost the government can afford to pay. For example, Chair of the Congressional Progressive Caucus Pramila Jayapal recently told Meet the Press that "a lot of this money is money the federal government makes and that these debt collectors make on interest rates that are higher than what we actually need to be charging."

"If you look at the whole issue, why would we work against ourselves if the objective is to get as many people educated as possible with the highest qualifications, whether it's a community college, a four-year college, or a trade school and get them into jobs where they can support themselves and their families?" she added.

Still, it's unclear what type of relief student-loan borrowers will be getting once the current pause on student-loan payments expires. White House Press Secretary Jen Psaki said last week that Biden "has not ruled out" canceling some amount of student debt by executive action, but she later told Fox news that borrowers will likely have to pay off their debt "sometime" while Biden is in office, prompting uncertainty surrounding the actions the administration will pursue.

Read the original article on Business Insider