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Economy
'Shameful': Trump Threatens to Redirect Student Loan Borrowers to Most Expensive Repayment Plans
More than 7 million borrowers booted from a Biden-era loan forgiveness program will have to quickly switch to a new plan using a system that's been backed up for months.
Mar 27, 2026
After axing a Biden-era student loan repayment program, the Trump administration is threatening to kick its millions of mostly low-income beneficiaries onto the government's most expensive plan unless they switch to a new one quickly.
The Washington Post reported on Friday that the Department of Education was beginning to email the more than 7 million people enrolled in the Saving on a Valuable Education (SAVE) program, telling them they needed to change their plan within the next 90 days.
Around 4.5 million of those borrowers earn incomes between 150% and 225%, allowing them to qualify for zero-dollar monthly payments under SAVE, which the Trump administration effectively killed in December after settling with Republican states who'd brought lawsuits against the program under former President Joe Biden.
Anonymous officials told The Post that those who do not switch plans within three months of receiving the email will automatically be re-enrolled in the Standard Plan. Unlike SAVE, which is income-based, the Standard plan has borrowers pay a fixed rate over 10 years.
Standard typically carries the highest monthly payments, and those transitioning to it from SAVE could pay more than $300 extra per month in some cases, with the poorest borrowers seeing the sharpest increases.
While 90 days may seem like plenty of time to switch to a less expensive repayment plan, it's not nearly that simple.
Due to the large exodus of borrowers, the Department of Education has struggled to process all the forms, processing only about 250,000 per month. Many borrowers who have tried to transition have found themselves waiting months for a reply.
To make matters more confusing, many of these borrowers will have to switch programs again soon, since all but one repayment program will be dissolved on July 1, 2028 as a result of last year's Republican budget law. The remaining plan will also be income-driven, though it is still expected to cost borrowers more each month.
According to a report released last month by the Century Foundation and Protect Borrowers, two groups that support loan forgiveness, nearly 9 million student loan borrowers are in default. During Trump's first year back in office, the student loan delinquency rate jumped from roughly zero to 25%, which it called "precedent-shattering."
"Much of the rise in delinquencies can be linked to the Trump administration’s actions aimed at increasing student loan payments," the report said. “The US Department of Education blocked borrowers from accessing more affordable payments through income-driven plans, having ordered a stoppage in application processing for three months and mass-denying 328,000 applications in August 2025. As of December 31, 2025, a warehouse’s worth of 734,000 applications sat unprocessed.”
Being in default has major ramifications for borrowers' finances. Those with delinquent loans saw their credit scores decrease by an average of 57 points during the first three quarters of 2025, dragging around 2 million of them into "subprime" territory, which forces them to pay thousands of dollars more for auto and personal loans and makes them more likely to have difficulty finding housing and employment.
The report estimated that if those booted from SAVE defaulted at the same rate as other borrowers, the number of student loan borrowers in distress could rise as high as 17 million.
According to Protect Borrowers, the typical family will pay more than $3,000 per year in additional costs as a result of the end of SAVE.
The end of SAVE comes as oil shocks caused by Trump's war in Iran have spiked gas prices and threaten to raise them throughout the economy, adding to the already elevated costs of food, housing, and transportation resulting from the president's aggressive tariff regime.
"In the middle of an affordability crisis driven by Donald Trump," said Sen. Elizabeth Warren (D-Mass.), "Trump is killing a plan that lowers student loan costs. It's shameful."
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Trump's Illegal Iran War to Push US Inflation Sharply Higher, OECD Projects
"Every single one of this administration's policies is doing what it can to raise prices," said one critic.
Mar 26, 2026
The Organization for Economic Cooperation and Development on Thursday released a report projecting that President Donald Trump's unconstitutional war with Iran will sharply increase inflation in the US this year.
According to OECD, the disruption in energy markets caused by the war means that "inflation pressures will persist for longer," with inflation in G20 nations "now expected to be higher in 2026 than previously projected."
OECD projects that inflation in the US, which was previously seen coming in at 2.6% in 2026, will instead rise to 4.2% this year thanks in large part to the war, which has spiked prices for oil, gasoline, diesel fuel, and fertilizer.
The report also warns that these numbers could get even worse if the Iran conflict drags on and the Strait of Hormuz remains shut for a prolonged period.
"Further disruptions to trade in the Persian Gulf could also have negative effects on a broader range of products in global supply chains," OECD writes. "For example, ongoing constraints to fertilizer supply could increase global food prices, with potentially serious impacts on household finances and inflation expectations. Furthermore, reduced supply of sulphur, helium or aluminium could impede production in a range of industries."
More ominously, the report finds that "prolonged disruptions to energy supply and growth, or lower-than-expected returns from net AI investment, or rising losses in private capital markets, could all trigger more widespread risk repricing in financial markets," with the result being a higher risk of default across "multiple credit products" and an evaporation of economic liquidity.
Asa Johansson, director of policy studies at OECD, said in an interview with The Wall Street Journal that the organization's forecast is "highly uncertain" at this point because "we don’t know the breadth and the duration of this energy shock" caused by the war.
Tahra Hoops, director of economic analysis at Chamber of Progress, expressed astonishment at the Trump administration's economic mismanagement in launching the Iran war, which came at a time when polling has consistently shown that affordability is the top concern for US voters.
"Every single one of this administration's policies is doing what it can to raise prices," wrote Hoops, "for a political goal that they have yet to coherently articulate, let alone have any chance at achieving."
Phillips O'Brien, professor of strategic studies at the University of St. Andrews, argued that the OECD's inflation forecast was yet another nail in the Republican Party's chances of retaining control of Congress this year.
"It’s going to be so much fun watching the GOP run on 'affordability' in 2026," O'Brien wrote.
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Trump Promised to Lower Energy Prices for Americans. He's Done the Exact Opposite
Electricity costs increased by nearly 7% last year, more than twice the rate of overall inflation, and cost Americans $123 more on average.
Mar 25, 2026
President Donald Trump ran on promises to cut energy prices "in half" within his first year in office. But according to a report released Wednesday, he's done the exact opposite, and it's expected to get much worse as oil prices soar from his war with Iran.
Electricity prices increased more than twice as fast as overall inflation in 2025, according to a fact sheet by the Groundwork Collaborative.
According to data from the Bureau of Labor Statistics, electricity costs increased by nearly 7% last year, compared with an overall consumer price index increase of 2.7%.
In January, a report by Sen. Elizabeth Warren (D-Mass.), the ranking member of the Senate Banking Committee, found that Americans spent an extra $2,120 in 2025 due to inflation across the economy. Electricity cost the average family an additional $123.
Groundwork's report attributed these price increases to Trump's aggressive tariffs, which the group said have raised the costs of building and maintaining electric grids—costs that energy companies pass directly to consumers.
It also noted the Trump administration's support for the swift build-out of artificial intelligence data centers, which have dramatically increased energy demand in places where they've been constructed.
Costs for consumers connected to America's largest power grid, PJM, for example, increased by a collective $9.4 billion last year—more than a 180% increase. Meanwhile, Bloomberg found that in areas near data centers, wholesale electricity costs had jumped by as much as 267% over the past five years.
That pinch is being felt by consumers, 66% of whom said their electricity bills increased over the past year, compared with just 5% who said they decreased, according to a poll earlier this month from Data for Progress.
Groundwork found that "rising energy prices hit working families the hardest," with those earning under $50,000 spending nearly 7% of their annual income on energy, compared with just 1.2% for those earning above $150,000, according to a 2025 report from the Bank of America Institute.
Rising costs have been a growing source of anger among voters who elected Trump to bring them down, but now give him just a 29% approval rating on the economy, according to a Reuters/Ipsos poll released Tuesday.
It's a historic low that Trump hit for the first time this month as gas prices in the US have soared to an average of $3.98 per gallon as a result of oil price hikes caused by Trump's war with Iran, which resulted in Iran closing the Strait of Hormuz, a critical global shipping route.
Groundwork noted that the pain of the war goes far beyond the pump: The price of residential heating oil is already up 35% since the war began. Meanwhile, rising diesel costs for trucks and disruptions to the global shipment of fertilizer are expected to jack up food prices.
Short of ending the war altogether, the group pointed out that Trump has options to reduce energy costs by tapping into increasingly cheap and abundant wind and solar energy.
Instead, however, the president has delayed hundreds of solar projects by introducing new review requirements that have slowed construction and backed lawsuits to gut efficiency standards.
Earlier this month, at the Trump administration's urging, a federal judge sided with 15 red states to strike down Biden administration energy standards, which were estimated to reduce costs by more than $950 per year for families living in federally funded housing.
While Trump has taken actions aimed at curbing the global fuel shock, including tapping the Strategic Petroleum Reserve and pausing the federal gas tax, a poll from Groundwork and Data for Progress this week found that more than half of Americans, 52%, would prefer to simply see the war end rather than these emergency measures.
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Dems Call for Prosecution of Corporations Using Trump's Illegal Iran War as Cover to Hike Prices
"As costs soar from Trump’s illegal war with Iran, any attempt by big corporations to jack up prices is unacceptable," said Rep. Jan Schakowsky.
Mar 25, 2026
Democratic lawmakers are warning corporate America to not use President Donald Trump's unconstitutional war with Iran as an excuse to jack up prices on US consumers.
US Sens. Elizabeth Warren (D-Mass.), Richard Blumenthal (D-Conn.), and Ed Markey (D-Mass.), along with Reps. Jan Schakowsky (D-Ill.) and Chris Deluzio (D-Pa.), sent a letter on Tuesday to the Federal Trade Commission demanding that it investigate and prosecute any unlawful price gouging by corporations during Trump's war, which has raised the cost of oil, gasoline, fertilizer, and other essential goods.
While the Democrats acknowledged that Trump's war created "broad supply chain disruptions and widespread uncertainty in the global economy," they warned that "big corporations may capitalize on this uncertainty to hike prices more than is warranted by actual input cost increases, price gouging everyday Americans while enriching executives and padding investors’ pockets."
The lawmakers accused big corporations in recent years of using assorted crises—including the global Covid-19 pandemic, the 2022 Russian invasion of Ukraine, and Trump's massive "Liberation Day" tariffs on foreign goods—to justify hiking prices beyond what could be warranted by input increases caused by external shocks.
The lawmakers also touted the Price Gouging Prevention Act that they introduced in July 2025 that would expand the authority of the FTC and state attorneys general to stop sellers from charging a "grossly excessive price, regardless of where the price gouging occurs in a supply chain or distribution network."
The proposed bill would also require public companies to "clearly disclose costs and pricing strategies" used to justify any price increases during periods of economic disruption.
In a social media post, Schakowsky said that "as costs soar from Trump’s illegal war with Iran, any attempt by big corporations to jack up prices is unacceptable," emphasizing that "we must crack down on price gouging and protect consumers."
The call to stop price gouging comes as concerns are mounting about the major economic damage that Trump's Iran war could produce.
Larry Fink, CEO of hedge fund BlackRock, predicted during an interview with BBC on Wednesday that there would be a "stark and steep recession" throughout the world if the war dragged on and the price of oil hit $150 per barrel, which he said would raise costs on products everywhere.
"Rising energy prices are a very regressive tax," Fink said. "It affects the poor more than the wealthy, because it's a larger component of their pocketbook."
CNBC reported on Wednesday that forecasters have been increasing their odds of a recession in the US economy this year, as the Iran war puts a strain on oil prices at a time when job growth in the country has already ground to a halt.
"Moody’s Analytics’ model has raised its recession outlook for the next 12 months to 48.6%," wrote CNBC. "Goldman Sachs boosted its estimate to 30%. Wilmington Trust has the odds at 45%, while EY Parthenon has it at 40%, with the caveat that 'those odds could rapidly rise in the event of a more prolonged or severe Middle East conflict.'"
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