White House officials plan to scrap $ 10,000 in student loans per borrower, in line with President Biden’s central campaign pledge to free millions of Americans from debt. The Washington Post.
Biden’s proposal, however, has not yet been finalized.
The announcement of the president’s plan to pay off the current 1.7 trillion arrears to the federal government on student loans was expected by many last Saturday, when Biden delivered an introductory speech at the University of Delaware. According to PostThe announcement was delayed after a mass shooting on May 24 in Texas.
White House officials say the plan would limit debt relief for Americans earning $ 150,000 and $ 300,000 to jointly file on the basis of previous year’s income. Post. It is unknown at this time what he will do after leaving the post.
Multiple sources familiar with the matter have given this information Inside higher ed That they have not been contacted by the Biden administration for any proposal to release the students from debt.
Progressive Democrats and debt relief lawyers have long fallen short of what they have called for in student loan relief. At the very least, progressive Democrats such as Massachusetts Senator Elizabeth Warren, Georgia’s Rafael Warnock and New York’s Chuck Schumer have called for Biden to cancel a loan of at least $ 50,000 per borrower.
Braxton Brewington, a spokeswoman for Debt Collective, said: “It’s not enough to cancel a হাজার 10,000 student loan to close the ethnic wealth gap, boost the economy, or get the voters you need in November.” “It simply came to our notice then. Biden should cancel every dollar and ensure the cancellation is automatic so that everyone can get their arrears relief without having to jump through administrative hoops. “
The NAACP issued a statement Friday saying $ 10,000 relief would not be enough. “Two key findings reinforce our claim that student loans disproportionately harm low-income families and, in particular, low-income black households. “We find that households with student loans, 52 percent of black households and 32 percent of non-black households have zero or negative net worth,” the NAACP said.
It added, “Student loans can delay or change a family’s decisions on many issues: where to live, what kind of work to do, starting a family, buying a house or starting a business.”
Biden told reporters in late April that he would make an announcement in the coming weeks about plans to tackle student debt. Following reports that the administration was considering raising income limits on who would be eligible for debt relief, education department officials warned that such a plan would create an administrative “train wreck” because the department did not have access to income information from borrowers.
According to the Department of Education’s 2021 data, a plan across the board to help pay off $ 10,000 debt per borrower could help 15 million Americans. According to federal data, the majority of borrowers – 53 percent – put less than $ 20,000 in federal student loans.
On Thursday, a coalition of more than 500 organizations representing various interests, including labor, civil rights and education, sent a letter to the president demanding that he use his executive powers to “immediately” cancel student loans.
“When the student loan of the borrower is canceled, their ability to repay other loans increases; Their geographical mobility and ability to stay in rural communities is improved; As such, they have the opportunity to do better, ”the letter said. “President Biden should protect all student borrowers by canceling existing loans.”
Debt relief across the board, the letter continues, “will strengthen the economy, tackle racial inequality and provide much-needed relief to all Americans to help weather the epidemic and record inflation.”
A 2022 poll from Data for Progress shows that 61 percent of voters are in favor of canceling some kind of loan from the federal government.
According to Scott Buchanan, executive director of the Student Loan Servicing Alliance, an organization that represents 95 percent of all service providers overseeing federal student loans, lenders concerned about administrative overload are concerned about the lack of communication from the administration.
“We have not had any discussions with the department about how any of these can be implemented or outlined the program. Preparing for that unknown is virtually impossible, “Buchanan said.
Republicans in Congress have held that student loan waivers will disproportionately benefit the rich and believe that Biden does not have the power to cancel student loan loans through executive action. A coalition of Republican senators recently raised a bill that would prevent Biden from canceling student loans.
“Congress is not going to pass a law authorizing the president, or they will not pass a law denying the president authority. At the moment, the initiative in this question is entirely in the hands of the Biden administration,” said Terry Hartl, senior vice president for official relations and public affairs at the American Council on Education. “So they can and will apparently move forward. It is possible, in fact, that there could be a lawsuit challenging the actions of the Biden administration and who knows where it will end up.