Although the White House had long signaled the move, veterans groups that strongly oppose the regulation had implored Trump to stand with members of the military who they say are routinely preyed upon by unscrupulous schools for their lucrative GI Bill education benefits.
In the lead-up to Memorial Day, veterans groups ran advertisements on Fox News urging Trump to support the congressional resolution. But siding with veterans would have forced Trump to abandon the longest-serving member of his Cabinet: Education Secretary Betsy DeVos.
“President Trump’s veto … was a victory for DeVos and the fraud merchants at the for-profit colleges. My question to the President: in four days did you forget those flag-waving Memorial Day speeches as you vetoed a bill the veterans were begging for?” said Sen. Richard J. Durbin (D-Ill.), who introduced the resolution in the Senate.
The veto arrives two months after Congress agreed to scrap DeVos’s overhaul of a 1995 law known as “borrower defense to repayment.” The law provides federal loan forgiveness to students whose colleges lied to get them to enroll.
An Obama-era update of the statute lowered hurdles for students and shifted more of the cost onto schools, but DeVos tried to scuttle the update and then rewrite the rule. The Trump administration in September finalized its rewrite, which limits the time borrowers have to apply for relief and requires them to prove they were harmed financially by the deception. The rule is scheduled to take effect July 1.
To sideline the policy, Democrats used the Congressional Review Act, which lets lawmakers overturn recent regulatory actions of federal agencies with a simple majority vote in both chambers.
Durbin and Rep. Susie Lee (D-Nev.) introduced resolutions in their chambers days after the Trump administration finalized the rule. But as the campaign to overturn the Trump policy gained momentum, the White House threatened to veto the resolution.
In a policy statement issued in January, the White House Office of Management and Budget said overturning the rule “would restore the partisan regulatory regime of the previous administration, which sacrificed the interests of taxpayers, students and schools in pursuit of narrow, ideological objectives.”
Yet in March, Trump told Republican senators that he was “neutral” on the rule, giving veterans groups hope that the president, who has sought and enjoyed support from veterans, might sign the resolution.
Hours before Trump vetoed the resolution Friday, American Legion National Commander James Oxford issued a statement urging the president to “come to the aid of student veterans,” much like he did a year ago in granting automatic student loan forgiveness to permanently disabled veterans.
News of Trump’s decision left the American Legion, other veterans groups, consumer advocates and lawmakers disappointed.
Lee pledged to forge ahead with a campaign to override the veto in the House.
“The fight for our students and veterans is far from over,” she said Friday. “I’m urging all of my colleagues from both sides of the aisle to put students, veterans and taxpayers first, and vote to overturn the 2019 Borrower Defense rule.”
The Trump administration estimates its new rule will save the federal government $11 billion over 10 years — loan payments that would have gone uncollected under existing rules.
“The Secretary is thankful to the president for his leadership on this issue,” Angela Morabito, a spokeswoman for the Education Department, said in a statement Friday. “This administration is committed to protecting all students from fraud and holding all schools accountable when they fail their students. This administration’s rule does just that, despite false claims from many corners.”
DeVos has defended her overhaul as a sensible and fair way to account for the needs of students, colleges and taxpayers. She has derided the Obama-era update as a giveaway for students and a veiled attempt to go after for-profit colleges.
“Whereas the last administration promoted a regulatory environment that produced precipitous school closures and stranded students, this new rule puts the needs of students first,” Trump said Friday. The new rule “extends the window during which they can qualify for loan discharge, and encourages schools to provide students with opportunities to complete their educations.”
Trump said the resolution “would return the country to a regulatory regime in which the Federal Government and State attorneys general, rather than students, determine the kinds of education students need and which schools they should be allowed to attend.”
Consumer advocates reject those arguments. They say the Trump administration has imposed arbitrary measures for calculating relief meant only to limit debt cancellation.
The closure of Corinthian Colleges and ITT Technical Institute, for-profit chains felled by charges of fraud and predatory lending, resulted in a deluge of claims at the Education Department. Claims continue to mount as other for-profit colleges, including Argosy University and the Art Institutes, have folded. The Education Department has received more than 300,000 claims for debt relief to date.