Biden officials consider action on student debt relief
The Biden administration is considering whether it can take steps to provide student debt relief through executive action, even as it continues to ask Congress to pass legislation to help borrowers and their families.
A tweet from White House press secretary Jen Psaki appeared to go further than her comments during a briefing earlier Thursday, when she said President Joe Biden was counting on Congress to act next. on student loan relief. Biden said he supports up to $10,000 in student loan forgiveness per borrower.
“The President continues to support student debt cancellation to provide relief to students and families,” Psaki tweeted. “Our team is looking at whether there are any steps he can take through executive action and he would be happy to sign a bill sent to him by Congress.”
It came hours after a group of Democrats urged Biden to use executive action to forgive $50,000 in federal student debt for all borrowers. The group, which included Senate Majority Leader Chuck Schumer of New York and Senator Elizabeth Warren of Massachusetts, said it would boost the economy and help close the country’s racial wealth gap.
Biden has previously said he supports erasing up to $10,000 in student debt through legislation, but he has not expressed interest in pursuing executive action. In a briefing before posting his statement on Twitter, Psaki appeared to reject the idea of using presidential powers to wipe out debt, saying Biden had already suspended student loan repayments during the pandemic.
“He would look to Congress to take the next steps,” she said.
Legal scholars have fallen back and forth over whether Biden has the power to deal with loan relief himself, with some saying the move is unlikely to survive a legal challenge.
The Trump administration moved to block broad debt cancellation in early January, issuing an Education Department memo concluding that the secretary had no authority to provide such assistance and that it would be up to Congress.
Schumer said he and Warren researched the matter and concluded “it’s one of those things the president can do on his own.” Past presidents have written off debt, Schumer said, but not on the scale proposed.
Democrats are pushing the issue as a racial justice issue and as COVID-19 relief. They rely on statistics showing that black and Latino borrowers are more likely to go into debt and take longer to repay their loans.
Rep. Ayanna Pressley, D-Mass., said the student debt crisis “has always been an issue of racial and economic justice.”
“But for too long, the narrative has excluded Black and Latino communities, and how this debt has exacerbated deep-rooted racial and economic inequalities in our country,” she said.
Rep. Ilhan Omar, D-Minn., who also supports the measure, said it would help millions of Americans who have suffered financial loss during the pandemic. “The last thing people should worry about is their student loan debt,” she said.
Calls for debt forgiveness are growing after years of tuition hikes that have contributed to rising national student debt. More than 42 million Americans now hold federal student loans worth a combined $1.5 trillion, according to Department of Education data.
In an effort to provide relief soon after the pandemic hit last year, the Trump administration suspended federal student loan payments and set interest rates at zero percent. Upon taking office, Biden extended the moratorium until at least September 30.
Some Democrats say that’s not enough, and Schumer said he recently met with Biden to advocate for broader relief.
Canceling $50,000 in student debt would cost about $650 billion, Warren said. She argues it would be a “big positive” for the economy by allowing more Americans to buy homes and start businesses.
Republicans have pledged to fight any attempt at blanket debt cancellation, saying it unfairly shifts the burden from borrowers to taxpayers.
During a Wednesday hearing with Biden’s nominee for education secretary, Sen. Richard Burr, RN.C., urged the White House to reject calls for mass pardons and pass legislation aimed at simplify loan repayment options.
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