WASHINGTON – President Biden asked Secretary of Education Miguel Cardona to prepare a memorandum on the president’s legal authority to write off up to $ 50,000 in student debt.
Although Biden has voiced his resignation from circumventing Congress to forgive the loans, he has come under increasing pressure from members of his own party, borrowers and advocates to do so.
Even before the pandemic, about a quarter of student loan borrowers were in default.
President Joe Biden has requested that Education Secretary Miguel Cardona prepare a report on the president’s legal authority to write off up to $ 50,000 in student debt per borrower, White House Chief of Staff Ron Klain said in a interview on Thursday with Politico.
“Hopefully we’ll see it in the next few weeks,” Klain said of the memo. “And then he will look at that legal authority, look at the policy issues around that and make a decision.”
Along the way of the campaign, Biden said he supported $ 10,000 in student loan forgiveness, but is under increasing pressure from Democratic Party members, advocates, and borrowers to go further and write off $ 50,000 per person and do so through of an executive action.
Arizona Senator Mark Kelly, a former astronaut, was trained to give injections by the time he was on the International Space Station.
Although Biden has in the past expressed reluctance to bypass Congress to cancel student debt, White House press secretary Jen Psaki suggested in February that the administration had not ruled out the possibility. On his first day in office, Biden extended a payment hiatus for federal student loan borrowers that has been in effect from March until next September.
Senate Majority Leader Senator Chuck Schumer, D-New York, said he has concluded that Biden can forgive $ 50,000 of the debt on his own.
“You don’t need Congress,” Schumer has said. “All you need is the movement of a pen.”
The press was allowed to watch the first three minutes of the meeting, which then took place behind closed doors.
During the 2020 Democratic presidential primary, Massachusetts Sen. Elizabeth Warren promised to forgive student loans in the early days of her administration, including with the announcement an analysis written by three legal experts, based on the College Student Loan Project. Harvard Law School, who described student debt forgiveness through executive action as “legal and permissible.”
Others say Biden would face legal challenges if he tried to pay off the debt on his own.
If it was determined that the president could write off student debt without passing legislation, borrowers could see their balances reduced or eliminated overnight. On the other hand, the chances of Congress agreeing to forgive the loans are, at best, uncertain given the slim majority of Democrats.
The Student Loan Relief Bill, as introduced, will provide $ 775.5 billion in debt relief to more than 43 million Americans and forgive nearly half of student debt.
“I think the administration is looking for a legally justifiable way to pay off up to $ 10,000,” said A. Wayne Johnson, who previously was in charge of federal student loan debt at the US Department of Education.
At the same time as his resignation in 2019, Johnson asked for $ 50,000 in student loan forgiveness per borrower, saying the US system was on the brink of predation and that a large chunk of the debt would never be paid.
$ 10,000 or $ 50,000
There are more than 44 million student loan borrowers in the United States, and the country’s outstanding balance is expected to exceed $ 2 trillion by 2022.
If all federal student loan borrowers got $ 10,000 of their debt, the nation’s outstanding education debt would drop to about $ 1.3 trillion, from $ 1.7 trillion, according to higher education expert Mark Kantrowitz.
And a third of federal student loan borrowers, or 14.4 million people, would see their balances reset to zero.
The cancellation of $ 50,000 for all borrowers, on the other hand, would reduce the outstanding balance of the country’s student loan debt to $ 700 billion, from $ 1.7 trillion.
Meanwhile, the $ 50,000 plan would write off all debt for 80% of federal student loan borrowers, or 36 million people, Kantrowitz said.
Even before the pandemic, about a quarter of student loan borrowers were in default or in default.
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