Larson, Warren Lead Lawmakers Calling on Federal Government to Stop Taking Social Security Benefits to Pay Defaulted Student Loans
Washington, D.C. – Today, Rep. John B. Larson (CT-01) and U.S. Senator Elizabeth Warren (D-MA), along with Senator Ron Wyden (D-OR) and Reps. Raúl Grijalva (AZ-07), Pramila Jayapal (WA-07), and Ayanna Pressley (MA-07), led their colleagues to call on the federal government to end the practice of offsetting Social Security benefits to pay off defaulted student loans.
“As a growing number of older Americans have federal student loan debt when they near or enter retirement age, we are concerned that these older borrowers are disproportionately subject to TOP collection,” the members wrote. “These borrowers who have struggled with their student loan repayment progress could see their wages, tax refunds, and Social Security checks garnished or offset.
“Offsetting Social Security benefits can push beneficiaries closer to—or even into—poverty, undermining the Social Security Act’s mission of providing for ‘the general welfare,’ basic economic security, and the well-being of vulnerable Americans,” the members continued. “Accordingly, we urge you to explore exempting Social Security retirement, survivor, and disability benefits from administrative offset due to student loan debt.”
Nearly 40 percent of federal borrowers over the age of 65 have defaulted on their student loans. Under the Treasury Offset Program (TOP), the federal government can withhold up to 15 percent of monthly Social Security or disability benefits for these defaulted student loans.
Last year, Larson, Grijalva, and Wyden introduced the Protection of Social Security Benefits Restoration Act, which would prevent the federal government from garnishing Social Security benefits for the repayment of all non-tax federal debt—such as student loans.
The full text of the letter to Social Security Administration Commissioner Martin O’Malley, Secretary of the Treasury Janet Yellen, and Secretary of Education Miguel Cardona is available here.
The letter was also signed by Reps. Jamaal Bowman (NY-16), Danny K. Davis (IL-07), Robert Garcia (CA-42), Doris Matsui (CA-07), Jim McGovern (MA-02), Bill Pascrell (NJ-09), Jan Schakowsky (IL-09), and Frederica Wilson (FL-24), and Senators Richard Blumenthal (D-CT), Laphonza Butler (D-CA), Ed Markey (D-MA), Jeff Merkley (D-OR), Alex Padilla (D-CA), Bernie Sanders (I-VT), Brian Schatz (D-HI), Tina Smith (D-MN), Chris Van Hollen (D-MD), Peter Welch (D-VT), and Sheldon Whitehouse (D-RI).