School's out, loans are back

The power players, latest policy developments, and intriguing whispers percolating inside the West Wing.

Jun 02, 2023 View in browser   By Lauren Egan and Eli Stokols Welcome to POLITICO’s West Wing Playbook, your guide to the people and power centers in the Biden administration. With help from Allie Bice. Send tips | Subscribe here | Email Eli | Email Lauren A debt ceiling default may have been averted, an economic calamity may have been avoided, and President JOE BIDEN may soon be taking what amounts to a victory lap with an Oval Office speech tonight. But not everyone is heading into the weekend belly full of Tatte and high on good vibes. One group in particular is feeling burned by how the week went down: student debt relief advocates. As details of the agreement began to circulate late Saturday night, those advocates said they were surprised to hear it included a provision effectively requiring the Biden administration to start collecting federal student loan payments — which have been paused since 2020 — at the end of the summer. At first, some advocates thought it was a mistake. That’s because they hadn’t received a heads up about it from the White House. Nor had the possibility of its inclusion been raised when a group of debt relief advocates met with senior administration officials just weeks earlier at the White House. But when the text of the agreement was released the next day — confirming that restarting payments was part of the legislation — advocates said they felt like the sacrificial lamb of the whole deal making process. “It was a total surprise. We felt like the biggest bargaining chip of the debt ceiling,” said NATALIA ABRAMS, president of the Student Debt Crisis Center. “The lack of discussion of this is what led to more of a feeling that we were used.” PERSIS YU, deputy executive director and managing counsel at the Student Borrower Protection Center, said that “student loan borrowers got the bad end of this deal.” “Borrowers are in a much more precarious state right now than they were before the debt deal,” she said. White House spokesperson ABDULLAH HASAN disagreed. “No president has fought harder for student debt relief than President Biden. The administration announced in November that the student loan payment pause would end in August — this bipartisan budget agreement makes no changes to that plan,” he said in a statement. “President Biden protected the student debt relief plan in its entirety from congressional Republicans who were threatening to tank our economy unless they could gut the plan. He stopped congressional Republicans from taking away our ability to pause student loan payments in future emergencies,” Hasan said. He also noted that Biden plans to veto the GOP-resolution repealing the administration’s student debt relief plan and that, at the Supreme Court, the administration is defending its plan against “special interests attempting to deny relief to millions of hard-working Americans, most of whom make less than $75,000 a year.” Biden himself has pushed back on criticism that he made too many concessions in the debt ceiling negotiation process. As for what he did give up, Biden has stressed that the reality of a split Congress forced his hand. Neither Democrats nor Republicans, he notes, will get everything they want. “That’s the responsibility of governing,” he said in a speech on Sunday. But that’s little solace for student debt relief groups. They say that Biden gave up one of the administration’s most important tools to protect borrowers if the Supreme Court strikes down the president’s plan to cancel up to $20,000 in federal loans. The court is expected to announce its decision in the coming weeks, and both the president and debt relief advocates have expressed doubt that the administration will be allowed to move forward with the proposal. Should that happen, then extending the payment pause would have been a logical fall back option, advocates argue. Now… that’s gone. “Codifying the end of the payment pause before you know how the Supreme Court will rule on broad-scale relief is reckless and tells student debtors that they’re bargaining chips not worth fighting for,” said BRAXTON BREWINGTON, spokesperson for the Debt Collective. For the White House, it’s a major gamble though one that has some logic to it. The president and his team have flirted with ending the payment pause several times now, only to keep it in place. The debt ceiling deal forces their hand, and places some of the responsibility on the shoulders of Republican leaders. Still, the process of getting there was messy. Some Democrats on Capitol Hill expressed frustration about being kept in the dark during the debt ceiling negotiations. And some student loan relief advocates say it has led them to rethink their relationship with the White House going into Biden’s reelection. “It’s a moment when folks are taking a beat to reassess how we can be most effective going forward,” said an advocate who asked not to be named to protect their relationship with the administration. MESSAGE US — Are you Warner Bros. Discovery Chairman DAVID ZASLAV? We want to hear from you. And we’ll keep you anonymous! Actually, probably not. Email us at westwingtips@politico.com. Did someone forward this email to you? Subscribe here!    DON’T MISS POLITICO’S HEALTH CARE SUMMIT: The Covid-19 pandemic helped spur innovation in health care, from the wide adoption of telemedicine, health apps and online pharmacies to mRNA vaccines. But what will the next health care innovations look like? Join POLITICO on Wednesday June 7 for our Health Care Summit to explore how tech and innovation are transforming care and the challenges ahead for access and delivery in the United States. REGISTER NOW.     POTUS PUZZLER With help from the White House Historical Association Under which presidency was a temporary horse stable erected on the White House grounds? (Answer at bottom.) Cartoon of the Week Cartoon by Bill Bramhall | Courtesy It’s about that time of the week when we feature a cartoon! This one’s by BILL BRAMHALL. Our very own MATT WUERKER publishes a selection of cartoons from all over the country. The Oval LIVE FROM THE OVAL, IT’S FRIDAY NIGHT: Biden, after weeks of measured comments about fraught private negotiations, will address the country Friday night about the compromise spending package he negotiated with House Speaker KEVIN MCCARTHY. The speech will mark the first time the president has given a formal, televised address from the Oval Office. As for the thinking behind the speech, press secretary KARINE JEAN-PIERRE said: “He just wanted to make sure that the Americans understood how important it was to get this deal done.” WHAT THE WHITE HOUSE WANTS YOU TO READ: This opinion piece by WaPo’s DAVID IGNATIUS about how, when it comes to the debt ceiling deal, the president “accomplished what America elected him to do — govern from the center and make deals that solve problems. Progressive Democrats don’t seem to like that cooperative spirit, which is a big reason their candidates keep failing to become president.” AND MAYBE… Anything about the latest jobs report. Our SAM SUTTON reports: “The red-hot labor market is refusing to cool down, showing the remarkable resilience of Biden’s economy but also making the Federal Reserve’s battle to curb inflation that much harder. The U.S. economy added 339,000 jobs in May, blowing through Wall Street’s expectations that employment growth would slow as higher borrowing costs and tighter credit conditions take hold.” White House deputy press secretary ANDREW BATES tweeted out the piece. WHAT THE WHITE HOUSE DOESN’T WANT YOU TO READ: With all the triumphalism around the spending deal, the administration would probably rather people not focus on this story by CNN’s MATT EGAN about how at least one agency is still weighing whether to downgrade America’s credit rating. Fitch Ratings is keeping the U.S. on a downgrade watch, explaining in a statement “that repeated political standoffs around the debt-limit and last-minute suspensions before the X-date (when the Treasury’s cash position and extraordinary measures are exhausted) lowers confidence in governance on fiscal and debt matters.” SPOTTED (AT THE NEW TATTE BY THE WHITE HOUSE): This place just continues to hum with White House business and a seemingly never-ending supply of monkey bread. Among those passing through the white-tiled sanctuary of sweets Friday: former Biden campaign manager GREG SCHULTZ, White House climate chief of staff MAGGIE THOMAS, outgoing national economic council chief of staff LEANDRA ENGLISH, CNN’s BETSY KLEIN (she grammed it), NPR'S TAMARA KEITH and assistant press secretary KELLY SCULLY, Axios’ HANS NICHOLS and Treasury’s MIKE GWIN, Time’s BRIAN BENNETT, AFP’s dynamic duo of SEBASTIAN SMITH and AURÉLIA END (after salads, they split a kouign amann), Reuters’ TREVOR HUNNICUTT, deputy communications director HERBIE ZISKEND and economic adviser JARED BERNSTEIN, AP’s AAMER MADHANI and ZEKE MILLER (methodically working his way through the entire menu), Today News Africa’s SIMON ATEBA, CBS’ ARDEN FARHI and Council on Environmental Quality’s SARA JORDAN and ALYSSA ROBERTS. “I was making fun of Zeke for coming three days in a row,” Ziskend said after grabbing an iced coffee just ahead of the lunchtime rush. “Now I think I’ve been here three days in a row.” And back inside the West Wing, some chatter was overheard coming out of the ABC News booth about the merits of the Jerusalem bagel (Sam, the bagel expert, here: they’re fine). THE BUREAUCRATS FIRST IN WEST WING PLAYBOOK: JULIE SIEGEL is joining the Office of Management and Budget as senior coordinator for management, DANIEL LIPPMAN has learned. She most recently was deputy chief of staff at the Treasury Department and is an alum of Sen. ELIZABETH WARREN (D-Mass.) and the CFPB and OMB in the Obama administration. — The aforementioned Sara Jordan is departing the Council on Environmental Quality, where she’s been the deputy chief of staff, to join the White House infrastructure team under MITCH LANDRIEU (the things you find out at Tatte!). She’ll be focusing on intergovernmental affairs in her new role. WE’LL TAKE IT AS A GOOD SIGN: U.S. Defense Secretary LLOYD AUSTIN and Minister of National Defense of China LI SHANGFU shook hands at a dinner Friday in Singapore, a potential sign of progress between their two nations after the Chinese spy balloon derailed relations, our MARCIA BROWN reports. “The two leaders shook hands but did not have a substantive exchange,” said Pentagon Press Secretary Brig. Gen. PATRICK RYDER in a statement. MEET ME IN PARIS: U.S. Trade Representative KATHERINE TAI and EU Trade Commissioner VALDIS DOMBROVSKIS will meet in Paris next week on the sidelines of the Organization for Economic Cooperation and Development’s meeting, our DOUG PALMER reports for Pro subscribers. The meeting is a follow-up to the annual U.S.-EU Trade and Technology Council meeting they both attended this week in Sweden. Tai said they’re looking to “finalize a deal aimed at promoting trade in steel and aluminum produced with lower carbon emissions.” Agenda Setting IN FINLAND, BLINKEN SPIKES THE FOOTBALL: Secretary of State ANTONY BLINKEN wrapped a week of NATO meetings in Europe with a speech Friday in the capital city of the alliance’s newest member, deriding Russian President VLADIMIR PUTIN’s “strategic failures” in Ukraine. Finland’s accession to NATO, he said, amounted to “a sea change that would have been unthinkable” for the long-neutral country before Russia, with which it shares a border, invaded another nation. He mocked Putin for failing “most spectacularly” in his central aim of making Ukraine part of Russia. “No one has done more to strengthen Ukraine’s national identity than the man who sought to wipe it out,” Blinken said. “Ukraine will never be Russia.” Asserting that the war will ultimately need to be resolved diplomatically, Blinken said the U.S. will resist calls for a ceasefire or what he called a “Potemkin Peace,” an agreement that freezes current lines in place” and “would legitimize Russia’s land grab.”   GET READY FOR GLOBAL TECH DAY: Join POLITICO Live as we launch our first Global Tech Day alongside London Tech Week on Thursday, June 15. Register now for continuing updates and to be a part of this momentous and program-packed day! From the blockchain, to AI, and autonomous vehicles, technology is changing how power is exercised around the world, so who will write the rules? REGISTER HERE.     What We're Reading Inside the Meltdown at CNN (The Atlantic’s Tim Alberta) CIA chief made secret visit to China in bid to thaw relations (Financial Times’ Dmitri Sevastopulo) Sinema and Manchin’s covert debt deal operation (Politico’s Burgess Everett and Jennifer Haberkorn) POTUS PUZZLER ANSWER President JOHN F. KENNEDY ordered a temporary horse stable to be available on the grounds of the White House for his family ponies, Macaroni and Tex, who were gifted to the Kennedy children by LYNDON B. JOHNSON, according to the White House Historical Association. A CALL OUT — Do you think you have a harder trivia question? Send us your best one about the presidents with a citation and we may feature it. Edited by Eun Kyung Kim and Sam Stein.   Follow us on Twitter Eli Stokols @EliStokols Lauren Egan @Lauren_V_Egan Allie Bice @alliebice   Follow us

To change your alert settings, please log in at https://www.politico.com/_login?base=https%3A%2F%2Fwww.politico.com/settings This email was sent to rouf@idiot.cloudns.cc by: POLITICO, LLC 1000 Wilson Blvd. Arlington, VA, 22209, USA Please click here and follow the steps to unsubscribe.