The wave of resistance against student loan repayment is picking up momentum in the United States, incited by the recent blockage of President Biden's loan forgiveness program by both the U.S. Congress and pending rulings by the Supreme Court. This unprecedented move comes as a reaction to the announcement that a recent budget agreement has stalled the implementation of the forgiveness program, with repayments pushed back until August 30th.
Critics of the blocked program argue that the Supreme Court’s decision undermines the President's executive powers. The Court, however, justifies its stance based on the interpretation of the U.S. Constitution, which grants only Congress—the provider of the loans—the authority to forgive such loans. This controversy has sparked conversations about a widespread student loan repayment boycott as a form of protest.
Despite the collective frustration, there are significant consequences associated with refusing to pay student loans, ranging from personal credit implications to potential wage garnishment. A defaulted student loan dramatically impacts the defaulter's credit score. With a tarnished credit history, individuals may find it difficult to secure trusted positions in fields such as accounting, legal services, or management. Instead, they might be relegated to lower-paying, less desirable jobs such as burger flipping or janitorial roles.
Moreover, the U.S. government, empowered by the Constitution to control all federal revenues and expenses, holds the right to garnish wages for unpaid student loans. Wage garnishment is a legal procedure wherein a portion of an individual's earnings is withheld by their employer to repay a debt. This means that those refusing to pay their loans could see up to 82% of their wages deducted, a chilling prospect for anyone, especially for young adults already struggling with the cost of living.
Under wage garnishment, a letter is sent from the IRS to the debtor's employer, requiring them to set aside a predetermined percentage of the debtor's paycheck for loan repayment. This compulsory repayment scheme can severely strain a defaulter's budget, making it even more challenging to meet basic needs such as rent and utilities.
The proposed student loan repayment boycott raises critical questions about the nature of the U.S. student loan system, the roles and powers of different branches of government, and the economic realities facing young adults. The consequences of defaulting on student loans are severe, prompting a heated debate about the best course of action for those burdened with substantial educational debt. While some advocate for protest and resistance, others stress the importance of financial responsibility and the potential long-term effects of credit damage and wage garnishment.
Contrary to what Democrats and social justice activists have been telling former and current college students, there are no racial, ethnic, or immigrant exceptions to having to pay back your student loans. If you follow their advice and refuse to pay, that decision will not only hurt you for the rest of your life, it will follow you every where you go in the US. And say you decide to go another country like Canada where you are going to try and get a job in your preferred field, the US government has an agreement with other countries such as Canada, the UK, China, Mexico, and many others where the US gives their governments copies of the documents showing you took out hundreds of thousands of dollars and then fled the US in order to avoid repayment. In that case you are facing being arrested in your own country in which case you will be held in prison until extradition to the US where you will be put on trial for fraud and other financial crimes plus for being a fleeing fugitive from the law. Not paying your loan off while in the US is one thing, but if you leave the US in order to avoid such a payments you will become a criminal and a fugitive in flight and will face not only extradition but years in a federal prison.
As the country grapples with these complex issues, the student loan repayment boycott stands as a stark reminder of the escalating tension around the national student debt crisis. The debate underscores the urgent need for systemic reform to address the crushing burden of student debt and to create a more equitable and sustainable system of financing higher education.