COA: Time to “put pressure on Biden to cancel student loans”

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THROUGH Sydney lake01 November 2021, 20:26

Representative Alexandria Ocasio-Cortez (D-NY) speaks at a press conference to discuss legislation that would strengthen Social Security benefits, as seen in October 2021. (Photo by Drew Angerer / Getty Images)

There are only 92 days until federal student loan repayments return, and discussions are underway over the possibility of debt cancellation. Since his inauguration in January, President Joe Biden has canceled more than $ 11 billion in targeted student loans, but that amount represents only less than 1% of all federal loans.

So far, debt cancellation has helped borrowers who frequented now defunct institutions, totally and permanently incapacitated borrowers, and public service workers. Democrats, however, continue to push Biden and the US Department of Education to move towards more widespread student loan debt forgiveness as part of the president’s Build Back Better framework negotiations. The BBB’s budget goal is to “save, recover and rebuild the country,” according to the White House, and addresses issues ranging from child care to climate change to expanding health insurance . BBB’s budget was recently slashed from $ 3 trillion to $ 1.75 trillion.

“I think that given [Build Back Better] has been cut, there are more opportunities than ever to pressure Biden to cancel student loans, ”US Representative Alexandria Ocasio-Cortez said in a statement. Instagram story on October 28, the same day, Biden released an updated framework for the BBB’s budget resolution.

What does Biden think about the student loan cancellation?

On the trail of the presidential campaign, Biden promised to immediately write off $ 10,000 in student debt per borrower, but that did not happen. He disagrees with other Democrats, including Ocasio-Cortez, Senate Majority Leader Chuck Schumer and Senator Elizabeth Warren, on two main elements of student loan cancellation: how much debt should be canceled by borrower and how the debt should be canceled.

Democratic leaders pushed Biden to write off debt for federal student loan borrowers up to $ 50,000, but he won’t budge. When asked at a CNN town hall on February 17, 2021 how he would make the $ 50,000 per borrower forgiveness happen, he replied, “I won’t make it.” Instead, he said he was “ready to write off” $ 10,000 in debt per borrower.

Biden also said during mayoralty in February that he did not want to write off the debts of borrowers who attended elite schools, arguing that the money would be better spent on early childhood education.

“Who cares what school someone went to?” Ocasio-Cortez tweeted in response. “Whole generations of working class children have been encouraged to take on more debt under the guise of elitism. It’s wrong. Nowhere does it say we have to trade early childhood education for student loan cancellation. We can have both.

Does Biden have the power to mass cancel student loans?

Ocasio-Cortez, Schumer and Warren also argue that Biden has the executive power to write off student loan debt en masse.

“He doesn’t need Manchin’s permission for this and now that his agenda is minced he needs to step up his executive action game and show his commitment to delivering for the people,” Ocasio-Cortez said on Instagram on October 28. “We have to get there.”

Biden has previously disagreed with this assessment.

“I don’t think I have the power to do that by signing” an executive order, Biden said at mayoralty in February 2021. House Speaker Nancy Pelosi agrees with Biden, saying this type of Debt cancellation could only be accomplished by an act of Congress.

“People think the President of the United States has the power to write off the debt,” Pelosi said in July. “He doesn’t. He can postpone, he can delay, but he doesn’t have that power.

Student loan cancellation in 2021

Since taking office, Biden has announced an overhaul of the Public Service Loan forgiveness program (PSLF) and canceled debt for borrowers who frequented institutions now defunct, as well as borrowers with total and permanent disabilities. .

Ultimately, these measures will help hundreds of thousands of borrowers, but it’s only a “drop in the bucket,” as Cody Hounanian, executive director of the Student Debt Crisis Center, puts it. There are over 43 million borrowers with federal student loans totaling over $ 1.7 trillion in debt.

Payments on federal student loans have been suspended since March 2020. The CARES Act granted forbearance, allowing student borrowers to choose whether or not to continue making payments during the pandemic. However, this well will dry up at the end of January 2021; federal student loan payments will increase on February 1, 2021.

Democrats like Ocasio-Cortez, Schumer and Warren have also consistently pushed for the abstention period to be extended, but to no avail. Biden and other White House officials announced in August that this was the last such extension of student loan forbearance.

“We need to organize and prepare for actions now because the showdown will take place at the end of January when payments are ‘supposed to’ revive,” Ocasio-Cortez said on Instagram.

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