What do we know about student loan forgiveness? When will this happen and how much will it be?
Despite being a central pledge of his election campaign in 2020, Joe Biden has done little to reduce the trillion dollar debt America’s students are carrying. He has campaigned on forgiveness for all, about $50,000 per student, but there has been no announcement of those plans yet.
In April, the administration said an announcement was “weeks away,” but it’s now believed that it would not be until August that the plans would be discussed with the public. This would coincide with the end of the debt repayment pause which is expected to end at the same time.
According to three people familiar with the situation, Biden is now consider canceling up to $10,000 but limit access to relief. Only single borrowers earning less than $150,000 a year, or less than $300,000 for married couples filing jointly, would be eligible for federal debt forgiveness. This is far less than promised during the election cycle and he is unlikely to be popular with his young voters, which is particularly vital with the midterm elections fast approaching.
How about the total debt reduction of $50,000?
Proponents of the full reduction argued that Biden had the power to do so using an executive order. So far, however, he has been unwilling to use it or discuss it publicly as he members of his party support him.
“With the flick of a pen, President Biden could forgive $50,000 in student loan debt and give millions and millions of student borrowers a new lease of life,” Senate Majority Leader Schumer, one of the biggest proponents of full forgiveness, said in October.
Progressive Democrats have also spoken out against the $10,000 plan. New York Representative Alexandra Ocasio-Cortez tweeted“$10,000 means the tested forgiveness is just enough to irritate people against it *and* the people who need forgiveness the most.”
“$10,000 relieves the most those who owe the least. What relief for the most desperate? For them, the interest will cancel out that quick 10k. We can do better.”
However, six months later and Biden made no secret that he no longer intended to deduct $50,000.
“I’m not looking at a $50,000 debt relief, but I’m carefully considering whether or not there will be additional debt relief,” Biden told reporters in late April.