Commentary: Defaulted student loans come due -- A hard but necessary lesson

E.J. Antoni and Peter St. Onge, The Heritage Foundation on Jan 8, 2026

Published in Op Eds

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The Biden administration spent years trying to buy votes with unconstitutional student loan bailouts, but now the Trump Department of Education is on a mission to get that taxpayer money repaid. That includes garnishing the wages of millions of borrowers who haven’t made any payments on their loans in almost six years. It’s about time.

In 2021, the Biden administration kept student loan repayments on pause because they were also making it illegal for millions of people to go to work, under the guise of COVID. But even after the economy reopened, loan repayment was never restarted because it was a fantastic way to buy votes at taxpayer expense.

In fact, Biden's handlers upped the ante to student loan “forgiveness,” their euphemistic term for a potential $1.6 trillion taxpayer bailout—comparable to the 2008 Wall Street bailouts—so blue-collar workers could pay the bills of over-educated and entitled deadbeats.

Even after the Supreme Court declared the bailouts illegal, Biden simply ignored them with a cynical tweak, expanding so-called Income-Driven Repayment plans to accomplish the same goal. Even people with relatively high incomes qualified for monthly payments of zero with no interest accruing either. That kind of workaround would keep student loan payments on ice forever.

When the courts decided perpetual payment pauses were equally illegal, the Biden administration simply withheld data from credit bureaus, hiding how many millions of student loan debtors were failing to make payments. This pseudo-forgiveness effectively gave an amnesty to deadbeats—on the taxpayer dime, of course.

That data on student loan defaults finally came to light in early 2025, and it was ugly. Roughly 5.3 million borrowers hadn’t made any payments since 2020, even after repayment was supposed to start in 2024. That's way over the 270-day delinquency period, putting those loans in default.

But instead of trying to collect on that debt, instead of getting taxpayers’ money back, the Biden administration covered up the numbers. President Trump's Department of Education has now done a 180—demanding repayment, including garnishing wages of college graduate deadbeats.

These collection efforts can mean 15 percent of the defaulted borrower’s disposable income garnished, and the government doesn’t even need to go to court to make it happen.

This is fiscally responsible to protect taxpayer money, but the move is also morally correct: It's fundamentally unfair to foist student loans of college graduates onto other people who already paid for their own education—or, worse, people who never got the chance to go to college.

Why should American welders, carpenters, mechanics, or plumbers be forced to pay for other people’s college and graduate school? And then there are high-school graduates who struggle to make ends meet so they can pay off other peoples' gender-studies Ph.D.s—hardly fair!

College graduates have significantly higher lifetime earnings than those who didn’t go to college. Student-loan bailouts put the cost of college and graduate school on lower-income Americans while gifting the benefit of attendance to those with higher incomes. It’s welfare for the rich.

Furthermore, everyone who took out a student loan (present authors included) knew it had to be repaid and promised to do so—under penalty of law.

The federal government doesn't bail out credit cards and mortgages. We shouldn't be bailing out high-income college graduates, forcing blue-collar folks to pay their bills.

There is over $1.6 trillion of outstanding student loan debt, held by some 43 million borrowers. Nearly 10 million of them are in default—a quarter of the total, and over twice the rate of credit-card defaults.

These are people who took money from their fellow Americans and now want to rip them off. They deserve neither a bailout nor sympathy for having their wages garnished. They borrowed the money, and it’s high time to pay it back.

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E.J. Antoni, Ph.D., is chief economist and Peter St. Onge., Ph.D., is senior economist at the Heritage Foundation.

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