Biden balks at taking executive action to cancel student loan debt

“We will wait for that conclusion before a final decision is made,” said Psaki.

The schedule offered is the latest indication of the White House’s discomfort in Biden about acting quickly and aggressively against student debt relief. At a CNN town hall on Tuesday evening, Biden ruled out canceling $ 50,000 in student loan debt per borrower because he found it more convenient to cancel debt of $ 10,000 per borrower.

“I won’t be able to do this,” Biden said emphatically to a Wisconsin audience who asked him if he wanted to cut $ 50,000 per person in student loan debt. This proposal has been supported for months by Senate Majority Leader Chuck Schumer, Sen. Elizabeth Warren (D-Mass.) And a number of other progressive lawmakers.

“I’m ready to write off a $ 10,000 debt, but not 50,” Biden told the audience, responding directly to the problem for the first time as president. “Because I don’t think I have the authority to do so by signing the pen.”

White House officials said Wednesday that Biden’s reference to the $ 10,000 loan write-off was not intended as a descriptor for executive action, but rather as an expression of his advocacy of achieving that goal through legislation he hasn’t yet suggested.

Such a plan would likely face a difficult path in Congress, where even some moderate Democrats and almost all Republicans oppose widespread student loan lending.

Some Democrats have also said that billions of dollars spent on widespread lending could be better spent elsewhere, or at least should be for borrowers in greatest need.

“Even modest student loan proposals are amazingly expensive and use federal spending that could advance other goals,” said Adam Looney, Obama administration finance officer and now a senior fellow at the Brookings Institution. wrote last week. “The amounts included in the loan proposals under discussion would exceed the cumulative spending on many of the country’s major poverty reduction programs over the past few decades.”

Biden’s comments at CNN City Hall on Wednesday drew the ire of progressives and elected Democrats.

“It is time to act,” said Schumer and Warren in a joint statement, reiterating that they believe the government “has extensive powers to provide urgently needed aid to millions of Americans immediately.”

Adam Green, co-founder of the Progressive Change Campaign Committee, said Biden’s rejection of the $ 50,000 figure and the possible suspension of lending by executive action were “unnecessary” and would damage his reputation with grassroots activists who urge swift action.

“It throws cold water on activists’ excitement for no reason,” Green said, calling it a “distraction” for other parts of his agenda, like Covid relief, where progressives were largely satisfied with his approach.

MP Alexandria Ocasio-Cortez (D-N.Y.) Also pushed back Biden City Hall’s response to the students’ debts. say in a tweet that “the case against student loan forgiveness is looking shakier by the day”.

“We have the * Senate Majority Leader * on board to award $ 50,000,” said Ocasio-Cortez, who poses a major potential threat to Schumer when he is re-elected next year. “Biden is holding back, but many of the arguments against it do not hold back water on closer inspection. We can and should do it. Keep pressing!”

Advocates of debt relief have increasingly referred to the debate as a racial justice issue, noting the disproportionate burden placed on borrowers by color loans through student loans.

Color of Change, a racial justice group, Approved A poll this week shows that two-thirds of black voters “strongly support” student loan repayment. The poll found that 40 percent of black voters would not vote for a candidate who opposes student loan debt cancellation.

Arisha Hatch, vice president and campaign leader for the group, described Biden’s comments on student debt on Tuesday night as “deeply disappointing.”

“It is definitely not in line with the black voters who not only voted for him but also gave the majority for Democrats,” she said. “It will take more pressure for him to fully understand how important this is for black voters and many other progressive voters.”

Alexis Goldstein, Senior Policy Analyst at Americans for Financial Reform, who has organized Hundreds of civil rights, labor, and progressive groups advocating debt relief have been optimistic about the Biden government’s review of the issue.

“We remain confident that the president can do this through executive action,” she said, adding that the $ 10,000 level should be a starting point, not a cap. “We will continue to push the President for a number that better reflects the crisis and better addresses the issues of racial justice.”

Around 45 million Americans owe roughly $ 1.6 trillion in federal student loans. The cancellation of $ 10,000 student loan debt would completely erase the debt of more than 15 million borrowers whose current balances are less than or equal to this amount as of September 30, according to the latest federal data available.

Another 23 million borrowers owe $ 10,000 to $ 60,000 in balances. and more than 7 million borrowers have federal debt of $ 60,000 or more.

Among the college students who borrow money to attend college, the average student has an average worth nearly $ 29,000 latest analysis from the Institute for College Access & Success.

The DOJ’s upcoming legal review, announced by the White House, comes amid a hotly debated debate over whether the Department of Education itself has the authority to cancel large portions of its outstanding student debt portfolio.

Proponents of student debt relief say the long-standing provisions of the Higher Education Act give the education minister broad powers to wipe out loans. They also argue makes a separate one Law of 2003 This gives the education department more discretion on student loans in declared emergencies.

But the Trump administration, in its dwindling days in office, issued a legal opinion that concluded that the department is not empowered to mine large amounts of debt without the approval of Congress. The memo, written by a Trump Political Officer, is non-binding on the agency and could be reversed by the Biden administration. An education spokesman declined on Wednesday to say whether the Trump administration memo remained in effect with the agency or whether it would be overturned.

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