March 29, 2024
A group of House Republicans is raising ethics concerns over White House staffers who may be encouraging the president to clear student loans while holding as much as $4.7 million in student loans themselves — a potential conflict of interest pervading the halls of the West Wing.

A group of House Republicans is raising ethics concerns over White House staffers who may be encouraging the president to clear student loans while holding as much as $4.7 million in student loans themselves — a potential conflict of interest pervading the halls of the West Wing.

The group — led by Reps. James Comer (R-KY), the ranking member of the Committee on Oversight and Reform, and Virginia Foxx (R-NC), the ranking member of the Committee on Education and Labor — penned a letter to Office of Government Ethics Director Emory Rounds outlining their concerns.

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President Biden’s student loan bailout is unfair to hardworking Americans who do not hold a college degree or who made tough financial decisions to pay for their college education,” Comer said in a prepared statement sent to the Washington Examiner. “President Biden’s bailout also raises ethical concerns about Biden administration officials with student loans who are working on this bailout scheme and stand to benefit financially from it.”

Biden is weighing whether to shift $10,000 or more per borrower of student loan debt on to taxpayers, which has infuriated Republicans and invited legal scrutiny. Reports hold that borrowers earning up to $150,000 individually and $300,000 if married would qualify, though nothing official has been announced yet.

According to a Bloomberg story, some of the biggest beneficiaries of student loan shifting work within the White House walls. Financial disclosures from the Office of Government Ethics show 30 staffers hold more than $10,000 in loan debt, including press secretary Karine Jean-Pierre and Deputy Director of the National Economic Council Bharat Ramamurti.

Nearly 20% of all aides required to file the disclosures reported holding student loans, which totaled between $2 million and $4.7 million collectively. One staffer reported owing between $500,000 and $1 million. Many lower-level staffers didn’t have to report, nor did those owing less than $10,000, meaning the grand total is likely to be higher.

The report prompted Foxx and Comer’s letter.

“This policy is an unjust wealth transfer from hardworking Americans to highly educated upper-middle-class graduates who borrowed from taxpayers to earn their degree, and, in some cases, multiple degrees,” reads an excerpt. “In addition to the substantial and negative ramifications of this illegal action, we are especially concerned that this policy may have been promulgated by White House staffers who stand to financially benefit from the decision, especially considering recent reports that White House political appointees owe millions in student loan debt.”

Biden himself said in 2019 that he wound up with more than $280,000 in student loans putting his children and grandchildren through college. Biden would fall above the income limit, however, as would Jean-Pierre, who was paid $155,000 last year and promoted this spring.

Just 13% of Americans hold student loans overall.

Comer and Foxx are not calling for specific actions at this point, according to a spokesperson, but the answers they get will inform what policies should be put in place to prevent self-dealing. Biden implemented an ethics pledge for all political appointees, which the pair said staffers holding student loans could violate.

The White House did not respond to a request for comment from the Washington Examiner.

Richard Painter, a University of Minnesota law professor and the chief ethics lawyer for President George W. Bush from 2005 to 2007, said the issue could be not just unethical but criminal.

“For staffers with student loans to participate in this matter could be a violation of the criminal conflict of interest statute, 18 U.S.C. 208, a statute which was at the heart of my compliance work in the White House,” he said. “While some might argue that the number of Americans with student loans is so vast that this could not be a ‘particular matter’ within the meaning of the criminal conflict of interest statute, I disagree with respect to the most controversial part of the proposal, which is student debt relief for people making well more than the national average income.”

White House staffers earned an average salary of $95,649 in 2021, well above the national average but below the $150,000 cutoff.

Painter would like to see an income threshold below six figures.

“I would say that this policy decision, whether to extend student loan forgiveness to a class of well-paid professionals who don’t really need it, is a ‘particular matter’ affecting a discreet and identifiable group of persons within the meaning of 18 U.S.C. 208,” Painter said. “Recusal is required.”

There’s another layer to the issue not addressed in the letter, Painter says, which involves White House senior staff who are on leave from a university but who have not given up tenure.

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White House economic adviser Cecilia Rouse is on leave from Princeton University and plans to return there upon leaving the Biden administration. Because universities would also benefit significantly from any federal subsidies for student loans, Painter thinks Rouse, who is sympathetic to borrowers, should recuse herself as well. Such a recusal would be purely ethical, as educational institutions have an exception from 18 U.S.C. 208.

Efforts to reach Rouse for comment were not successful as of press time.

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