Biden should write off $ 50,000 in student loan debt for each borrower
Democratic Representative Ayanna Pressley (D-MA) today introduced a House resolution calling on President-elect Joe Biden to use the executive power to write off $ 50,000 in federal student loan debt for each borrower. She was joined by Democratic Representatives Ilhan Omar, Maxine Waters, Alma Adams, Madeleine Dean, Pramila Jayapal, Barbara Lee and Jahana Hayes.
“Large-scale student debt cancellation is precisely the kind of bold, high-impact policy that the broad and diverse coalition that elected Joe Biden and Kamala Harris expects to implement,” said declared Congresswoman Pressley in a statement “As we fight for meaningful economic relief for workers and families that responds to the scale and scope of the crisis we face, debt cancellation female student is one of the most effective ways to provide direct relief to millions of people, to help close the racial wealth gap, boost our economy, and begin to secure a fair and just recovery. On the first day of his administration, President-elect Biden will have the executive power to write off billions in student debt with the stroke of a pen. “
Pressure to largely write off student loan debt has gathered momentum in recent months, and the Pressley House resolution mirrors a similar resolution introduced in the Senate by Senators Elizabeth Warren (D-MA) and Chuck Schumer (D -NY) in September. Warren and Schumer also called on the next president to write off $ 50,000 in student loan debt for each borrower.
Although Biden has expressed support for a large student loan forgiveness, he has not publicly endorsed either the proposed $ 50,000 figure, or the use of executive power to enact such a drastic policy change. Progressive lawmakers and consumer groups have pointed to a provision in the Higher Education Act that they say gives the President, through the Secretary of Education, the power to “modify, compromise, waive or release loans. students ”. Other consumer advocates and student loan experts have argued that the legal basis for using this executive power to write off student loan debt is his.
But not everyone agrees, and the provision of the Higher Education Act has never been used before to enact such broad student loan relief. Some consumers and legal experts have expressed concern that executive action to pass broad student debt cancellation could face legal challenges on the grounds that it exceeds the authority granted by Congress. .
Nonetheless, progressive lawmakers and consumer rights organizations hailed Pressley’s decision.
“We applaud Representative Ayanna Pressley and her allies in Congress for urging President-elect Joe Biden to use existing authority to cancel student debt,” said Natalia Abrams, executive director of the nonprofit Student Debt Crisis. “As the COVID-19 pandemic grows, far too many people are choosing between student loan payments and rent, putting food on the table and keeping the lights on. President-elect Joe Biden can change that. The cancellation of student debt will bring much-needed financial relief to individuals and stimulate the economy for years to come. “
Advocates have highlighted the racial wealth gap as a major reason for pursuing student debt cancellation. Federal data released in 2017 shown that nearly half of black student loan borrowers who entered college in the 2003-04 academic year had defaulted on at least one student loan 12 years later. These same data shows that black students who enrolled in school in 2004 owed more on their student loans after 12 years than the amount originally borrowed.
According to National Center for Education Statistics (NCES), 77.7% of black students borrow federal student loans to pay for their graduate studies. This figure is significantly higher than the national average for all students (60%) and for white students (57.5%). Black students are also more likely attend for-profit institutions, which are often accused of deceptive and predatory conduct, and have higher dropout rates than other colleges and universities. 75% of black borrowers who have abandoned for-profit institutions ended up failing on their student loans.
“Canceling student debt is a racial justice issue, as black and brown borrowers face the greatest barriers to access, affordability and retention in higher education,” said Tiffany Loftin , National Director of the Youth and College Division of the NAACP. “To make education a right, we need a radical policy that meets the needs of 44.7 million people who are shackled by debt, [and] it starts with the cancellation now.
In addition to canceling $ 50,000 in federal student loan debt for each borrower, the House resolution calls on Biden to use the executive power to eliminate any resulting tax liability related to the forgiveness of the debt, and to extend the current COVID-19 student loan relief for borrowers with remaining balances.