Overnight Finance

On The Money — Student loan relief blocked again

President Biden
Greg Nash
President Biden answers questions during a press conference in the State Dining Room of the White House on Wednesday, November 9, 2022 following the midterm elections.

The Biden administration has stopped taking student loan applications following another court ruling. We’ll also look at the most shocking crypto collapse yet, how affordable housing performed with midterm voters and Twitter’s verification disaster. 

But first, see why the GOP is dreading a Trump 2024 announcement

Welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. For The Hill, we’re Sylvan LaneAris Folley and Karl Evers-Hillstrom.


Biden officials stop accepting loan forgiveness filings

The Biden administration announced Friday it would stop accepting student loan forgiveness applications after a federal judge ruled against the program on Thursday.

The government website that previously led to the student loan applications now shows a message titled “Student Loan Debt Relief Is Blocked.” 

“[A]t this time, we are not accepting applications,” the site reads, explaining the pause is due to the court ruling in Texas.  

The site goes on to say the administration will fight in court for the program and the department will hold the applications of the millions of borrowers who already applied for the relief. 

The background:  

  • President Biden’s plan, which was set to forgive up to $20,000 for some student loan borrowers, was struck down by U.S. District Judge Mark Pittman, a Trump appointee.
  • The judge said the program is “an unconstitutional exercise of Congress’s legislative power” and the administration would need approval from Congress to move forward.  

Here’s more from The Hill’s Lexi Lonas.

From The Hill: Federal judge strikes down Biden student debt relief program

CRYPTO COLLAPSE

Crypto faces a crisis of confidence amid FTX collapse 

Cryptocurrency is facing a crisis of confidence after popular crypto exchange FTX filed for bankruptcy, the latest and most significant failure in a series of high-profile collapses.  

FTX lent billions of dollars in users’ deposits to an affiliated trading firm that suffered massive losses on risky bets. That left FTX with a shortfall of up to $10 billion, raising the question of whether its users will lose everything.

  • It’s a shocking turn of events for a respected firm run by Sam Bankman-Fried, who cultivated deep relationships with members of Congress and helped them write industry friendly legislation.
  • Bankman-Fried was instrumental in crafting the first comprehensive crypto bill, unveiled by Sens. Cynthia Lummis (R-Wyo.) and Kirsten Gillibrand (D-N.Y.) in June.
  • FTX is the biggest crypto firm to go down this year, following Celsius and Voyager, and its demise prompted BlockFi to block users from withdrawing funds Thursday. 

Karl explains the mess here

HOME SWEET HOME

Here’s how affordable housing fared on midterm ballots 

One housing affordability measure made it on a statewide ballot in this year’s midterm elections amid a nationwide housing crisis that has left the U.S. short at least a million homes — and it is projected to pass narrowly.  

But a new report released Friday by Moody’s Analytics shows that local ballot measures promoting affordable housing had widespread bipartisan support in the 2022 midterms.

  • The report’s authors wrote that this support shows voters have recognized the consequences brought on by a lack of affordable housing and voted accordingly. “In fact, many proposals were approved with nearly 70% of the vote. Even in those that failed, the results indicate many voters crossed party lines.”
  • Cities nationwide experienced massive rent growth during the pandemic, especially those, like Austin, Texas, where remote workers flocked for more affordable housing.  

The Hill’s Adam Barnes digs into this here

WILL THE REAL ED MARKEY PLEASE STAND UP? 

Markey presses Twitter for answers about verification process 

Sen. Ed Markey (D-Mass.) pressed Twitter for information about its process to verify users who paid for a subscription on Friday after a fake account impersonating the senator received a blue verification check mark.  

The impersonating account, under the username @realedmarkey, received a blue verification mark after it was set up as a test by a Washington Post reporter with Markey’s permission. 

  • In a letter to new Twitter CEO Elon Musk Friday, Markey slammed the launch of the feature allowing users to pay for a blue check mark. The blue check mark once “allowed users to be smart, critical consumers of news and information in Twitter’s global town square,” but Musk’s “rapid and haphazard imposition of platform changes” and layoffs at the company “accelerated Twitter’s descent into the Wild West of social media,” Markey wrote in the letter.
  • A spokesperson for the Federal Trade Commission said the agency is “tracking recent developments at Twitter with deep concern,” and President Biden on Wednesday said Musk’s deal and ties to foreign entities are “worthy of being looked at.” 

We have the latest here

Good to Know

Democrats’ chance of pushing through a key antitrust bill to rein in the power of tech giants may be thwarted if their shot at keeping Senate control depends on the results of a Georgia runoff.  

Even if Democrats secure Senate control, their chances of passing the bill, or other antitrust legislation targeting tech giants, in the next Congress are slim with Republicans poised to win control of the House — making the lame-duck session the best shot for the bill’s supporters.  

Here’s what else we have our eye on: 

  • President Biden insisted Friday the U.S. will deliver on its climate change commitments, addressing an audience at an international climate summit in Egypt that is skeptical of whether the U.S. will actually live up to its promises.
  • Electronic cigarette company Juul Labs Inc. has found a way to avoid bankruptcy through a cash infusion from its early investors and hundreds of layoffs. 

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 Monday. 

Tags Biden student loan plan Ed Markey FTX Student loan forgiveness
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