Trump Admin Spins Death of Student Loan Forgiveness Plan as Great for People Who Want Student Loan Forgiveness

Trump Admin Spins Death of Student Loan Forgiveness Plan as Great for People Who Want Student Loan Forgiveness

Nicole LaFond

Tue, December 9, 2025 at 11:22 PM UTC

6 min read

The Trump administration has made moves to officially kill off President Biden’s income-driven student loan repayment plan — meaning that some borrowers who have not made payments for years will have to figure out a plan for making payments again. And officials are trying to spin the decision as some sort of positive thing for participants in the plan, despite the fact that they are enrolled because they can’t afford their federal student loan costs.

Biden ran for president on a promise of creating a path toward student loan forgiveness for some borrowers. The Supreme Court blocked Biden from enacting the most sweeping version of this ambitious agenda item in June 2023. His Saving on a Valuable Education plan, known as SAVE, was also blocked by the high court in August 2024.

SAVE is considered the most generous of Biden’s attempts to establish an income-driven repayment plan to give Americans some relief. It allowed some low-income borrowers to pay as little as $0 a month. It also provided a path toward loan forgiveness for some.

Republican attorneys general sued the Biden administration over SAVE, arguing that the plan had the secretary of education take steps that exceeded his authority. The effort to challenge the SAVE plan in court was led by Missouri.

Trump’s Education Department announced on Tuesday that it has proposed a joint settlement agreement with the state of Missouri that would, if approved by a judge, officially end the SAVE plan. This speeds up the demise of a program that had already been blocked by the conservative-majority Supreme Court and dismantled by the One Big Beautiful Bill, which gave borrowers until July 1, 2028 to change their repayment plans (the bill also created new repayment plans for those who qualified for income-driven payments, but those won’t be available until July of next year).

Now, some seven million borrowers will have to figure out a new payment plan for their student loans sooner than expected. And the Department of Education is painting the change as if its some sort of relief from the confusion and “limbo” created by the generous-for-low-income-borrowers Biden-era policy. An excerpt from the Education Department (also not long for this world) press release:

As part of the proposed joint settlement agreement, the Department will not enroll any new borrowers in the illegal SAVE Plan, deny any pending applications, and move all SAVE borrowers into legal repayment plans. If the agreement is approved by the court, it will mark the definitive end of the Biden Administration’s illegal student loan bailout agenda, putting it to rest once and for all, and end the limbo that more than 7 million borrowers currently face when it comes to not being able to make payments on their federal loans.
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“Our Office fought for hardworking Americans who were being preyed upon by Biden Administration bureaucrats, and we won in court every time,” said Missouri Attorney General Catherine Hanaway. “Unilaterally saddling taxpayers with someone else’s Ivy League debt ignored Congressional authority and was clearly unlawful. We appreciate President Trump’s real, long-term solutions instead of illegal student loan schemes.”

It’s also appears to be part of a brazen attempt to pit low-income borrowers against working class Americans in some sort of faux class war (or maybe “affordability” standoff?) during a time when no one can afford anything. Per NPR:

“We are sitting on the precipice of millions of borrowers defaulting on their loans,” says Persis Yu, of Protect Borrowers. “And instead of choosing to defend a plan that would have been affordable for these borrowers, this Department of Education has capitulated to the AGs and is going to make life much more expensive.”

Shapiro Gets Ahead of Trump Rally

President Trump plans to test out his new “affordability” campaign messaging strategy — stolen from Dems — at a rally in Pennsylvania tonight. He is reportedly expected to defend his economic record at a casino in northeastern Pennsylvania where he will talk about “lower gasoline and egg prices and tax cuts passed this year,” in Reuters’ words, citing an unnamed White House official.

Democratic Pennsylvania Gov. Josh Shapiro got out ahead of Trump’s impending disingenuous spin in his state on Monday evening, telling MS Now that Trump is “lying about affordability.”

“He’s been lying about the impact of his policies. And I want to make sure that we’re setting the record straight, showing how his policies are screwing over farmers and manufacturers, making stuff cost more every day,” Shapiro said.

Trump Acknowledges He’s Clueless About Honduran Prez He Pardoned

Politico conducted a wide-ranging interview with Trump on Monday, during which the president admitted he didn’t know much about the case against Honduran President Juan Orlando Hernández, who he pardoned last week. Hernández was found to have been part of a conspiracy that moved 400 tons of cocaine into the U.S.

An excerpt from the interview by Politico’s Dasha Burns.

Burns: You pardoned former Honduran president Juan Orlando Hernández and let him out of prison even though he was convicted in a massive international drug trafficking scheme. How is that zero tolerance on drug trafficking if …
Trump: Well, I don’t know him. And I know very little about him other than people said it was like, uh, an Obama/Biden type setup, where he was set up. He was the president of the country. The country, uh, deals in drugs, like probably you could say that about every country, and because he was the president, they gave him like 45 years in prison. And there are many people fighting for Honduras, very good people that I know. And they think he was treated horribly, and they asked me to do it, and I said I’ll do it.

Admiral Meets With Bipartisan Group

Adm. Alvin Holsey, the head of the U.S. Southern Command, met with Republicans and Democrats on the Senate Armed Service Committee today, just before he is expected to step down from the position due to tension with the Trump administration and its lawless attacks on what it says it suspects are drug trafficking boats off Venezuela. Per WaPo:

Holsey’s forthcoming retirement was disclosed in October and followed months of tension with Defense Secretary Pete Hegseth, people familiar with the matter said. At the time, these people said, Hegseth was unhappy with Holsey’s cautious approach as the administration, which has put significant emphasis on what it says are the national security imperatives inherent to the Western Hemisphere, looked to ramp up pressure on certain Latin American countries.

In Case You Missed It

We launched a new series from TPM’s Hunter Walker today on Life Inside the Undocumented Underground. The first story is also out today: Inside the Secret Network Offering Sanctuary to Immigrants Amid Trump’s ICE Onslaught

Morning Memo: SHOWTIME: Boasberg Summons Key DOJ Witnesses in Contempt Inquiry

Wave of Income Tax Cuts Has Left Many States Vulnerable to Trump SNAP and Medicaid Crisis

New from Kate Riga this afternoon: Republicans Fight to Kill Lingering Campaign Finance Regulation after SCOTUS Obliterated the Rest

Josh Marshall: Will the 21st Century Nabobs Win Their War on Public Accountability?

Yesterday’s Most Read Story

Roberts on Cleanup Duty as Court Prepares to Kill Independent Government Agencies

What We Are Reading

GOP lawmakers wary of Trump escalating beyond boat strikes in Venezuela

Zelenskyy reaffirms his refusal to cede land to Russia as he rallies European support

New York judge orders release of Ghislaine Maxwell-related grand jury records

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