Debate: Should the Freeze on Student Loan Payments Be Extended Again?

Two professors discuss extending the freeze on student loan payments for a sixth time given current economic conditions.

Democrats in Congress have started to press President Joe Biden to adopt measures to extend the freeze on student loan payments, which is set to expire on May 1.

To date, the freeze has been extended five times since it was put in place in response to the COVID-19 pandemic in March 2020. The move has generated pushback from others who believe that these relief measures should be allowed to expire, as the moratorium on evictions and foreclosures has been allowed to expire.

We asked two professors and authors of ALM’s Tax Facts with opposing political viewpoints to share their opinions about extending the freeze on student loan payments.

Below is a summary of the debate that ensued between the two professors.

Their Votes:

Bloink

Byrnes

Their Reasons:

Bloink: Yes, we’ve made progress and have started to return to normal after nearly two years of COVID-19-related safety measures. However, it remains important to continue these important COVID-related relief measures in place to protect millions of Americans. The increased cost of living that we’ve experienced over the last year has made it difficult for Americans to continue putting food on the table despite a strong labor market. That fact alone makes a strong case for continuing these and other relief measures.

Byrnes: This is just an election-year plot designed by struggling Democrats to secure votes and maintain their footing in Congress. Yes, early in the pandemic, the student loan repayment freeze was necessary to protect millions of Americans who may have defaulted because of unprecedented conditions. Now, Americans are returning to work and no longer need this relief — which, by the way, is being shouldered by responsible taxpayers who have continued to support themselves during the pandemic. 

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Bloink: Student loan payments will resume across the board on May 1, in just a single short month, if we don’t take action to continue student loan relief today. Americans with student loans shouldn’t be forced to make the tough choice between keeping the lights on and repaying student loans.

Byrnes: Extending the freeze on repayments does nothing other than encourage Americans to remain at home in the midst of yet another unprecedented situation: our current labor shortage. There’s no reason Americans can’t secure employment to restart payments on their student loans — which, incidentally, they haven’t been paying in two years, all while interest rates on those loans have been frozen at zero.

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Bloink: Millions of Americans lived on unemployment compensation alone for months on end while their workplaces were closed during the pandemic. Of course, there are those who did abuse the system. That doesn’t mean we should punish those who legitimately couldn’t work and were forced to drain savings accounts and take on debt to support their families. Continuing this student loan relief will offer a lifeline to countless Americans — who, in many cases, simply can’t afford these payments.

Byrnes: These Americans have benefited from two years of this zero-interest, zero-payment policy — all while continuing to realize the benefits that their education has afforded. They’ve also adjusted to not paying these bills. By allowing the freeze to continue, we further cement that mentality into place. That’ll only make it more difficult when these payments inevitably must resume. It’s time we start treating student loan borrowers like the adults they are and hold them responsible for their obligations.

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