Republican U.S. Representative from Iowa Ashley Hinson on Friday slammed the White House for a Twitter thread that went viral highlighting Republican lawmakers for criticizing the cancellation of student loans after canceling much larger amounts. paycheck protection program loans.
Hinson, of Marion, called it a dishonest comparison to President Joe Biden’s student loan plan.
“The PPP program, with its flaws, was intended to help people stay employed during a national crisis — a completely different intent behind the program and behind what this pardon was designed to do,” Hinson said Friday during his lecture. weekly phone call with Iowa reporters. .
Hundreds of billions of dollars in PPP loans were issued earlier in the COVID pandemic to help businesses and other organizations keep their workforces employed and cover large overhead costs. The program ended on May 31, 2021 and allowed borrowers to have their loans forgiven based on employee and compensation levels and how the loan money was spent.
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A study by economists at the Federal Reserve Bank of St. Louis found that about $800 billion in PPP loans were doled out, “saving” about 3 million jobs at its peak in the second quarter of 2020. he study, however, found that the program was poorly targeted. Nearly three-quarters of its benefits went to unintended beneficiaries, including business owners, creditors and suppliers, rather than workers, and far more benefited high-income households.
The authors concluded that the PPP cost taxpayers about $4 for every dollar of wages and benefits received by workers in “saved” jobs, and that only about a quarter of PPP funds supported jobs that otherwise , would have disappeared.
Hinson argues that unlike President Joe Biden’s executive action that canceled student loan debt, the PPP was approved by Congress as a temporary, bipartisan program.
PPP loans were designed as forgivable from the start, provided they kept workers on the payroll in times of national crisis. Federal student loans were offered on very different terms with the intent to repay them, she said.
Hinson’s Democratic opponent in the November election, State Senator Liz Mathis of Hiawatha, criticized the student loan cancellation.
“I worked in the State Senate to lower the cost of college education and increase access to job training for the high-paying jobs we need to fill here in Iowa; we need policy at the federal level that does the same,” Mathis said in a statement. “The Biden Administration’s Student Loan Forgiveness Plan Fails to Address Fundamental College Affordability Issues.”
Democratic U.S. Senate candidate from Iowa Mike Franken — who is challenging Senator Chuck Grassley in November — echoed Mathis in a post on Twitter.
“The Administration’s College Debt Cancellation Plan does not ‘fix’ the problems associated with the cost of higher education,” he wrote. “A much more comprehensive approach is needed.”
Both Hinson and Mathis’ spouses worked for companies that had benefited from PPP loans.
Hinson’s husband, Matthew Arenholz, was co-owner of Transportation Insurance and Consultants of Waterloo, which received a $142,029 PPP loan in April 2020 — before Hinson was elected to Congress — for payroll. He had $143,043 written off, including accrued interest. The company operates as Elliott Hartman Insurance Services.
Arenholz is identified as a partner of the agency on its website; Hinson’s office said her husband was no longer a co-owner.
Amperage, a Cedar Falls marketing and fundraising firm linked to Democratic challenger Mathis’ husband Mark, also received a $669,400 PPP loan in April 2020 for payroll, utilities and interest payments. mortgages, and $676,354 was forgiven, including accrued interest.
The company, which has offices in Cedar Falls, Cedar Rapids and Wisconsin, also received a $669,425 payroll loan in February 2021 and $672,530 was forgiven.
Mark Mathis was co-owner and co-founder of ME&V, which rebranded as Amperage in 2015, according to the company’s website. He is listed as a special projects consultant on the company’s website.
Hinson on Friday said she was “exploring all options to push back” on Biden’s plan, which it estimates could cost between $400 billion and $600 billion.
Proponents argue that canceling student debt would free up younger generations to invest in their financial future, provide a moderate boost to the economy and narrow the racial wealth gap, as black students are more likely to borrow federal student loans and at higher amounts than others.
Hinson argues that Biden’s plan will shift the cost to taxpayers who didn’t attend college and those who worked to pay off their loans in full.
Despite the announced income caps, Hinson also argued that Biden’s student debt cancellation plan will disproportionately benefit high-income Americans, stoke inflation and encourage colleges to raise tuition and fees. students to take out loans they can’t afford to repay,” instead of incentivizing trade schools and apprenticeship programs that allow our students to graduate debt-free and with the skills they need to access well-paying career opportunities.