The Biden administration is considering taking executive action to cancel America’s US student debt, the White House chief spokeswoman said Thursday, responding to pressure from Democratic lawmakers and progressive groups.
President Biden has previously questioned his ability through executive action to cancel some or all of the US student debt. Instead, he called on Congress to pass a bill that would write off $ 10,000 in student debt for each borrower.
The White House moved on Thursday and said it was open to debt relief without a move by Congress. “Our team is looking to see if there are any steps he can take through executive action and he would appreciate the opportunity to sign a bill that was sent to him by Congress,” wrote White House Press Secretary Jen Psaki. on twitter.
Ms. Psaki’s comments followed a press conference Thursday held by Senate Majority Leader Chuck Schumer, D., NY, Senator Elizabeth Warren, D., Massachusetts, and Rep. Ilhan Omar, D., Minn., Ayanna Pressley was (D., Massachusetts), Alma Adams (D., NC) and Mondaire Jones (D., NY)
Mr. Schumer urged Mr. Biden to use his executive powers to dispose of $ 50,000 in student loan debt for all borrowers.
“This debt is what keeps people from buying cars, going on vacation, raising families, getting the job they want to get. It’s a huge anchor for our entire economy. And there is very little the president could do with the stroke of a pen that would stimulate our economy more than canceling US $ 50,000 in student debt, ”Schumer said.
More than 43 million Americans owe a total of $ 1.6 trillion in federal student loans. WSJ’s Josh Mitchell explains how President Biden plans to help borrowers manage this debt. Photo Illustration: Carlos Waters (Originally published January 12, 2021)
“The bottom line is that this is one of the things the president can do himself. Sen. Warren and I did a lot of research, ”he added.
Senate Republicans have resisted legislative efforts to cancel student debt, saying such a move would help many wealthy families and cost taxpayers.
Student debt relief would provide financial relief for millions, but it would also raise fairness issues for students who have already paid off their loans or avoided taking out large loans, and for people who have never attended college.
A law passed last year had suspended monthly payments by most borrowers on their student loans until September 2020, and then-President Trump extended the suspension until January of that year. Mr Biden, who took office on January 20, put payments on hold until September 2021 through executive action to help borrowers weather the coronavirus pandemic.
Mr Biden has also said he supports the $ 10,000 cancellation of student loan debt for people with federal loans, but did not include the proposal in a $ 1.9 trillion Covid-19 bailout package that his government received drives forward.
Senate Democratic leaders and progressive groups have been arguing for months that the president has the power to unilaterally cancel federal student debt.
But some legal experts say it would be illegal to cancel student debts through executive action. In the final days of the Trump administration, a political officer serving as assistant legal advisor to the Department of Education came to this conclusion.
About 43 million Americans owe $ 1.6 trillion in government student debt, according to data from the Department of Education. Americans owe more student debt than any other form of household credit other than mortgages.
The bulk of the $ 1.6 trillion federal student loan was made by the Treasury Department and is now owned by the U.S. government. But part of that sum is loans originally made by private lenders and guaranteed by the federal government. Mr Biden said he wanted to provide both types of credit. To forgive them would be borne by federal taxpayers.
The Democrats in Congress have urged Mr. Biden to use executive action to remit student debt during his first 100 days in office. Progressive groups have stepped up their efforts to get the President to do this.
In December, when he called news columnists, Mr Biden, President-elect, said, “It is questionable whether I – possibly the President – have executive authority to cancel up to $ 50,000 in student debt. Well, I think that’s pretty questionable. IM not sure. I probably wouldn’t do that. “
At least one major risk of student debt forgiveness is that a judge will declare the move illegal, which could confuse borrowers.
In recent years, Democratic support for some form of debt relief and free college has increased, with pressure mounting after the coronavirus pandemic.
Write to Josh Mitchell at joshua.mitchell@wsj.com and Eliza Collins at eliza.collins@wsj.com.
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