[The 11th-Hour Indicators: Biden’s Final Policy Push and Regulatory Moves]-[Student loans, savings accounts, and goodbye to artificial red dye]

The 11th-Hour Policy Sprint

As President Biden prepares to depart the White House, his administration has engaged in a flurry of "11th-hour" regulatory and policy actions. This week’s Indicator from Planet Money examines these final maneuvers, which range from financial lawsuits and student debt cancellation to food safety regulations, all occurring in the shadow of the incoming Trump administration.

The CFPB vs. Capital One: A $2 Billion Dispute

One of the most contentious moves involves the Consumer Financial Protection Bureau (CFPB), an agency currently under fire from political figures who have suggested it should be "deleted." The CFPB recently filed a lawsuit against Capital One, accusing the bank of "cheating customers out of more than 2 billion dollars in interest."

The core of the dispute centers on "high-yield" savings accounts. The CFPB alleges that Capital One misled customers by keeping them in older, low-interest accounts while simultaneously launching newer products—such as the "360 Performance Savings" account—that offered significantly higher interest rates. For instance, in 2024, the older account paid a meager 0.3% interest, while the newer product offered 4.35%. Capital One has pushed back, calling the lawsuit part of a "recent pattern of filing 11th-hour lawsuits ahead of a change in administration."

Student Loan Forgiveness: The Piecemeal Approach

Another significant indicator highlighted is the number "150,000," representing the individuals who recently had their student loans forgiven. This brings the total number of borrowers who have seen debt relief under the Biden administration to five million.

Despite the Supreme Court striking down the administration’s original, sweeping student loan forgiveness plan, the White House has persisted through "alternate channels." By utilizing various "workarounds," the administration has successfully forgiven approximately $183 billion in debt. While critics argue this approach lacks the "stroke of the pen" impact of a single, unified policy, it has resulted in a "piecemeal patchwork" of relief that continues to unfold even in the final days of the term.

Regulatory Shifts: From AI Chips to Red Dye No. 3

The administration’s final days are marked by a wide variety of executive actions. Beyond financial and student loan policies, the government has moved to block Nippon Steel’s acquisition of U.S. Steel, proposed restrictions on the export of AI chips, and released new nutrition label guidelines.

In the realm of food safety, the FDA has officially removed "Red Number 3" from its list of approved food dyes. This decision follows a petition citing studies that linked the additive to cancer in lab rats. Although the FDA clarified that the specific mechanism for cancer in rats does not necessarily translate to humans, a "decades old law" mandates the ban of any additives that cause cancer in animals. Consequently, companies have until 2027 or 2028 to phase out the dye from products like candy and frosting. With Red Number 3 gone, the food industry is left with "eight allowable food dyes," with Red 40 becoming the primary remaining red option for manufacturers.

Conclusion

These indicators reflect an administration attempting to cement its legacy through aggressive regulatory action before the transition of power. Whether these "pen actions" will have a "lasting effect" remains to be seen, as President-elect Trump may seek to "roll back" many of these policies shortly after taking office.