By Alice Seeley
Earlier this week, the Biden administration announced will continue its student loan cancellation effort by making 40,000 borrowers eligible to have their student loans erased under the Public Service Loan Forgiveness program.
“Student loans were never meant to be a life sentence, but it’s certainly felt that way for borrowers locked out of debt relief they’re eligible for,” stated U.S. Secretary of Education Miguel Cardona. “The Department of Education will begin to remedy years of administrative failures that effectively denied the promise of loan forgiveness to certain borrowers enrolled in IDR plans.”
In addition to the 40,000 borrowers, another several thousand borrowers with older loans will also be forgiven through the income-driven repayment (IDR) plan. Another 3.6 million borrowers will receive at least three years of additional credit toward IDR forgiveness, the Education Department said in a statement.
According to the Education Data Initiative, 43.4 million Americans, 12% of America’s population, have around $1.6 trillion in outstanding student loans from the Federal Loan Portfolio, an average of more than $37,000 each.
Rep. Alma Adams (D-NC) expressed her support for these actions and urged the Biden administration to take more dramatic measures.
“As we approach the summer months, I am continuing to call on the president to finish the job by canceling up to $50,000 of student loan debt across the board for our struggling borrowers because we must crush that debt before it crushes our economy,” Rep. Adams stated.
In addition to Rep. Adams, 95 other lawmakers, 21 Senators, and 75 members of the House asked Biden to “cancel student debt now,” saying it would “provide long-term benefits to individuals and the economy, helping families buy their first homes, open a small business, or invest in their retirement. More broadly, canceling student debt would add tens of billions of dollars in GDP growth.”
However, there is confusion regarding Biden’s power to cancel student loans. Speaker of the House Nancy Pelosi (D-CA) stated that the president does not have this legal authority and “that would be an act of Congress.” On the other hand, Senate Majority Leader, Chuck Schumer (D-NY), believes that Biden does have the legal power ability to cancel all student debt.
