Under the Obama administration, the motto “work hard, play harder” is continually being redefined to “work hard, pay harder”. According to The Wall Street Journal, a new plan is being finalized that will allow millions of low-income Americans to slash their monthly student-debt bills, in turn raising taxpayer costs for the government’s mushrooming student-loan portfolio. This week the Education Department proposed to expand eligibility for the Pay As You Earn program, which sets borrowers’ monthly payments as a small share of their income.
Education Department officials report that six million more Americans will become eligible this autumn for PAYE. The program caps monthly loan payments at 10 percent of discretionary income, defined as the amount above 150 percent [...]