On the Money — All eyes on Biden’s student debt plan

After years of anticipation, President Biden is poised to wipe out trillions of dollars in student loan debt. We’ll also look at climate-related savings and an IRS security review. 

But first, we’ve got bad news for foes of the spotted lantern fly. 

Welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. For The Hill, we’re Sylvan Lane, Aris Folley and Karl Evers-Hillstrom. Someone forward you this newsletter? Subscribe here.

White House to announce student loan cancellation

The White House is expected to announce on Wednesday a plan to cancel a chunk of student loan debt, in addition to an extension of the existing payment pause, three sources with knowledge of the situation told The Hill.  

Sources said President Biden’s intended measure will include at least $10,000 in loan forgiveness for borrowers who make less than $125,000 annually, as well as another payment freeze for roughly four months.  

• The $10,000 figure would be the largest forgiveness of federal student loans per individual to date. 
  
• But it would be less than what advocates and some Democratic lawmakers have been demanding, which has ranged from $50,000 per borrower to total cancellation. 
  
• The move comes as the Aug. 31 deadline for the White House to extend a student loan freeze rapidly approaches.  

Alex Gangitano and Hanna Trudo have the details here. 

BREAKING DOWN THE IMPACT

Here’s how a $10K student loan forgiveness plan would affect millions 

President Biden is expected to cancel up to $10,000 in student loan debt per federal borrower earning less than $125,000 annually on Wednesday, holding true to a campaign promise and relieving millions of their student debt burdens.  

• If the president’s plan moves forward, he could potentially eliminate loan balances for around 15 million people, which accounts for about one-third of all U.S. student loan borrowers.  
  
• These Americans will see their monthly payments go away and the U.S. will simultaneously lower its $1.7 trillion outstanding student loan balance.  

The decision will still leave 30 million borrowers on the hook for the remainder of their balances, some potentially seeing little movement in their monthly payments when the moratorium reaches its expected end. 

Here’s more from Changing America. 

CLIMATE COSTS 

Climate law could reduce costs associated with emissions up to $1.9 trillion: OMB 

The Inflation Reduction Act, the tax and climate bill President Biden signed into law last week, could reduce the costs from climate-related damages by up to $1.9 trillion, according to an analysis by the Office of Management and Budget (OMB).  

The analysis published Tuesday is based on three models crafted by Rhodium Group and Princeton University. They found the law’s climate provisions could potentially cut up to 1 billion annual metric tons of carbon dioxide by the end of the decade, nearly meeting the White House target of cutting emissions in half relative to 2005 by 2030.  

• Meeting these projections could reduce financial damages from climate impacts by between $700 billion and $1.9 trillion up to 2050, the analysis found.  
  
• The savings would also come in the form of reduced property damage from climate disaster, fewer negative health impacts and fewer energy costs associated with hotter temperatures.   
  
• The numbers do not include any potential benefits to other parts of the economy, which could produce further reductions in emissions, OMB said.  

Zack Budryk has more here. 

TAX THREATS 

IRS to conduct security review following GOP attacks, online threats 

The IRS announced on Tuesday that it would conduct a large-scale security review of its operations and facilities after becoming the target of attacks both online and from congressional Republicans over $80 billion in funding allocated to the agency under the Inflation Reduction Act. 

“In recent days, there has been an abundance of misinformation and false social media postings, some of them with threats directed at the IRS and its employees. We are aware of these concerning messages, and I want to assure you that your safety is and will continue to be my top priority,” IRS Commissioner Charles Rettig wrote in a Tuesday message to employees obtained by The Hill. 

• The security review will consist of measures including “monitoring perimeter security, designations of restricted areas, exterior lighting, security around entrances to our facilities and other various protections.” 
  
• It comes after Republicans have made the additional IRS funding a sticking point in their midterm campaign message, warning that it would lead to a flurry of new audits. 

Tobias Burns has more here. 

Good to Know

Minority home owners are losing wealth because of an appraisal process that doesn’t provide them with the true value of their homes and properties, Housing and Urban Development (HUD) Secretary Marcia Fudge says in a new interview. 

Here’s what else we have our eye on: 

• More than 100 congressional Democrats signed a letter Tuesday urging the Biden administration to extend a key waiver for the Public Service Loan Forgiveness (PSLF) program, which forgives student loan debt for those who work in public service or other qualifying jobs. 
  
• Barre Seid, a secretive electronics magnate, has reportedly donated a record $1.65 billion to a new conservative nonprofit led by Federalist Society co-chairman Leonard Leo. 

That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and coverage. We’ll see you tomorrow. 

VIEW FULL VERSION HERE