Student loan debt in this country is now north of $1 trillion. As we have reported many times (go, for instance, here and here), a lot of student loan debtors are behind on their payments. A large percentage of this debt — and over 90% of new loans — is owed to the federal government.
So, as explained here, Representative Tom Petri (R-Wis.) wants the Department of Education and the IRS to take loan repayments straight out of debtors' paychecks:
Congress will consider overhauling debt collection in the $100
billion-a-year U.S. student loan program, replacing it with automatic
withdrawals from borrowers’ paychecks tied to their income — a system
used in the U.K. Legislation that Wisconsin Republican
Representative Tom Petri plans to introduce as soon as this week would
require employers to withhold payments from wages in the same way they
do taxes. Payments would be capped at 15 percent of borrowers’ income
after basic living expenses. * * * The plan would resemble those in the U.K., Australia, and New Zealand.
Since the money would be withdrawn automatically and tied to income,
borrowers would no longer have to negotiate with collectors and
loan-servicing companies, which often offer a confusing array of
deferral and forbearance options after a job loss or illness. The
Education Department would manage the withdrawals, with help from the Internal Revenue Service.