Rep. Jared Golden calls Biden student loan plan 'out of touch,' worries it might spur inflation

Aug. 26—Calling President Joe Biden's move to help millions of Americans with student loans "out of step with the needs and values of working-class Americans," Democratic U.S. Rep. Jared Golden of Lewiston said Wednesday he is opposed to the White House plan.

That puts Golden in the same camp as U.S. Sen. Susan Collins, a Maine Republican who is also against the president's plan, and Republican Bruce Poliquin, one of Golden's challengers in the Nov. 8 general election. The other contender in the race, independent Tiffany Bond, said Biden's proposal does not go far enough.

Golden said in a prepared statement that Biden's decision "is out of touch with what the majority of the American people want from the White House, which is leadership to address the most immediate challenges the country is facing."

"The president should be taking action to reduce inflationary pressures; with this move, he potentially makes them worse," said the two-term lawmaker from Maine's 2nd District.

Poliquin, a former member of the U.S. House of Representatives, said "working Mainers who are paying for home mortgages, car loans and increased costs of home heating and groceries should not have their taxes taken to pay for loans they didn't take out."

He also said Biden's use of the Heroes Act to make this decision "raises serious legal questions."

About 40% of Mainers who are at least 25 years old have a college degree, but that figure is lower in the more-rural, less-affluent 2nd District that Golden has represented since 2018, when he defeated Poliquin in a hotly contested U.S. House race.

U.S. Rep. Chellie Pingree, a 1st District Democrat, hailed Biden's decision. She wrote on Twitter it "will improve the lives of more than 48 million Americans, including tens of thousands of Mainers!"

Bond said she does not agree with Golden's assertion that Biden is "out of touch," and doubts the president's initiative will have much impact on inflation.

She said Biden's proposal falls short of what is needed.

Student loan debt has been "a high-stress issue for millions of Americans," including nearly 200,000 Mainers carrying debts, often in excess of the amount Biden expects to forgive, she said.

Bond said "thousands of current students" are "watching their costs tick up," as are "tens of thousands of parents approaching, or in, retirement who have cosigned for predatory loans."

"Frankly, it's tone deaf of Golden to have no empathy for those who wanted the same chance at a college education he has had" when he attended Bates College in Lewiston, Bond said.

Bond said Biden should have adopted "a far more wise, fair and effective solution" and stopped charging interest on student loans, while crediting existing debtors for the amount they have paid toward interest.

"This would leave students off the hook for the predatory lending our government permitted," she said. "Getting rid of interest is a reasonable compromise, and thousands of Maine voters I have personally spoken with across the political spectrum have widely agreed."

Pingree also said student loan borrowers should not have to pay interest on their debts.

Collins said Biden's decision "is inherently unfair to millions of hardworking Americans who chose not to pursue higher education; paid their own way to attend a community college, trade school, or certificate program; or paid off their student loans."

"Essentially, the president is requiring a hardworking logger to subsidize a graduate of Yale, who is earning far more but has student loans," Collins said in a prepared statement. "With the stroke of a pen and without congressional approval, the president has added more than $300 billion in new spending."

Poliquin said he believes "in providing financial aid and support for kids to attend college" and "fought against President Obama's proposal to tax 529 college savings plans" during his two terms in the House.

Poliquin said he would like to "expand, strengthen and modernize 529 college savings plans to make college more affordable, including changes allowing students to purchase necessary school supplies, including computers, using their 529 account funds."

Biden announced Wednesday his administration will cancel student loan debts up to $10,000 for those earning less than $125,000 annually, and up to $20,000 for students who had received Pell grants aimed at low-income Americans.

The White House also said it plans a new, income-driven repayment plan to help lower income people by capping monthly repayment of undergraduate loans at 5% of a borrower's discretionary income, half the current rate.

Biden also paused repayments on student loans until the end of the year.

The Education Data Initiative says that in Maine, there are 37,500 federal borrowers who are 24 or younger and owe an average $14,933, for a total of $560 million.

There are 67,000 borrowers between ages 25 and 34 who owe an average $31,791, for a total of $2.13 billion, and 51,200 between 35 and 49 who owe an average $42,478, totaling $2.18 billion.

In addition, there are 23,200 debtors between ages 50 and 61 who owe an average $42,672, totaling $990 million, and 7,600 federal borrowers 62 or older who owe an average $47,368, totaling $360 million.