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President Joe Biden is considering reneging on a campaign promise to cancel limited amounts of student debt, and is now mulling far more substantial coverage of the $1.6 trillion owed by 43 million people.
Biden alluded to his plan during a meeting on Monday with the Congressional Hispanic Caucus, where he told Rep. Tony Cardenas, a California Democrat, that he had plans that would please the group.
The president previously supported canceling up to $10,000 of debt per student, but is now said to be open to forgiving a larger, unspecified amount.
It also remains unclear exactly how many students could be affected, although Biden has indicated that he’d be willing to forgive debts owed to public and private colleges.
Biden made the pledge as he faces tanking approval ratings with just months to go until the midterm elections that political pundits predict will see heavy losses for his Democrat party.
It will likely appeal to younger, left-leaning voters, but has angered conservative critics who say the move smacks of nannying, and that the inflation-hammered US can ill-afford it.
Cardenas told CBS that the president provided no specifics but simply ‘smiled and said, ‘You’re going to like what I do on that, I’m looking to do something on that and I think you’re going to like what I do.’
President Joe Biden said he was thinking about forgiving federal student loan debt but failed to provide specifics despite his campaign pledge to forgive $10,000 per student
U.S. Rep. Tony Cardenas, (third from the left), said the president suggested a plan to canceling some debt for the 43 million students holding $1.6 trillion in loans in a meeting with members of the Congressional Hispanic Caucus (pictured) on Monday
‘The president never mentioned an amount nor did the president say that he was going to wipe out all student debt,’ Cardenas said. ‘He did a dialogue with us about the differential between young people who went to public schools or private schools and we CHC members said he should focus on both.
‘And he said, ‘Okay, good to know.”
On Monday, the White House said it did not yet have any plans on how canceling student debt would work, but Press Secretary Jen Psaki reiterated that the administration will ultimately announce a decision about canceling ‘some student loan debt’ between now and the end of August.
The August deadline stems from the administration’s decision earlier this month to extend the pandemic-era pause on federal student loan payments through August 31, saving borrowers $5 billion in interest payments a month, according to the U.S. Department of Education.
While the president has yet to specify how much student debt he would be canceling, some Democrats have called on him to use executive action to cancel at $50,000 in debt per borrower, with Squad members Alexandria Ocasico-Cortez and Ayanna Pressley urging Biden to cancel all student debt.
Rep. Ocasio-Cortez, of New York, criticized the Biden’s administration’s decision to extend the moratorium on student loan payments, saying that it was just a stall tactic that leaves young people uneasy.
‘I think some folks read these extensions as savvy politics, but I don’t think those folks understand the panic and disorder it causes people to get so close to these deadlines just to extend the uncertainty,’ the Democrat firebrand said on Twitter.
‘It doesn’t have the affect people think it does. We should cancel them.’
Ocasio-Cortez claimed the president’s student loan extension actually harms borrowers by extending their period of uncertainty
Pressley also chimed in on Tuesday, highlighting the impact that student loan payment moratoriums have on black women
The Federal Reserve Bank of New York estimated that calling off $50,000 in debt per student would help nearly 30 million borrowers and cost about $904 billion, CBS reported.
The average student would lose about $23,800 in debt.
Last week, the Education Department said its latest reforms on student loans will wipe out debts for 40,000 such borrowers and bring 3.6 million Americans closer to ending their payments.
Education Secretary Miguel Cardona called the current system a ‘life sentence’ for millions of low-income borrowers and pledged to correct ‘historical failures’ that have plagued repayment schemes like the income-driven repayment program (IDR) and Public Service Loan Forgiveness Program (PSLF).
Borrowers working as public servants are eligible for forgiveness under PSLF once they’ve made 10 years of qualifying payments.
Additionally, ‘several thousand borrowers’ in the government’s IDR program will also have their student debt forgiven, and more than 3.6 million people are going to get at least three years of credit toward IDR forgiveness.