Statement of Alexis Goldstein, AFR’s Senior Policy Analyst, in response to President Biden’s comments on student debt cancellation at the Milwaukee, Wisconsin Town Hall: President Biden’s Racial Economic Equity campaign plan called for an “immediate cancellation of a minimum of $10,000 in federal student loan
We, the undersigned 50 organizations, applaud Majority Leader Chuck Schumer, Senator Elizabeth Warren; Representatives Pressley, Adams, Bowman, Jones, Omar, and Torres; and Chairwoman Waters for their bicameral resolution urging President Biden to take executive action to cancel up to $50,000 in federal student loan debt using legal authorities already granted by Congress. Cancelling student debt will provide both immediate financial relief to millions of Americans and crucial economic stimulus for everyone during this protracted crisis. This action would also boost GDP and job creation at a time of intense labor shocks and economic uncertainty.
As the payment pause on federal student loans was extended without modification, the suspension on payments and waiving of interest only goes to borrowers with federally-held loans. It continues to leave an estimated 9 million of federal student loan borrowers without any relief at all.
Today, more than 325 organizations sent an updated letter to President-Elect Biden and Vice President-Elect Harris, calling on them to use executive authority to cancel federal student debt on day one of their administration. The letter highlights that cancelling student debt would stimulate the economy, help reduce racial wealth gaps, and could have a positive impact on health outcomes. The groups write that “executive action is one of the few available tools that could immediately provide a boost to upwards of 44 million borrowers and the economy.” Further, this action would be an important first step in advancing the President-Elect’s campaign priorities to ensure racial equity, focus on economic recovery, and deliver COVID-19 relief.
Over 325 organizations signed a letter to President-Elect Biden and Vice President-Elect Harris, calling on them to use executive authority to cancel federal student debt on day one of their administration. This letter is a re-release of a November letter, and has been updated with more than 85 additional signers.
The absence of a legislative request to cancel student debt in Biden’s “American Rescue” plan heightens the urgent need for President-Elect Biden to cancel student debt administratively. Overwhelming research shows that student debt cancellation would provide dramatic relief particularly in low-income neighborhoods and among communities of color that are disproportionately burdened by ballooning debt. We hope the absence of debt cancellation in this package is a clear indication that President-Elect Biden is planning to act quickly to use his authority to cancel student debt through executive action. We look forward to working with him to do that.
We welcome the announcement that President-Elect Biden plans to extend the student loan payment pause. However, we encourage him to take immediate executive action on student debt cancellation. We know President-Elect Biden realizes how important student debt relief is, and how many other battles Congress will have in this critical moment. The surest way to get immediate cancellation is through executive action.
Betsy DeVos spent her tenure at the Department of Education fighting against the legal rights of defrauded student loan borrowers at every turn. She rolled back protections, defied court orders, and even complained, when the law required her to execute debt cancellations previously approved by the Obama administration, that she did so with “with extreme displeasure.” And in her final days as Secretary, she condemned debt cancellation, even as the pandemic and economic crisis continues to rage, and student loan borrowers need every break they can get. We look forward to a Department of Education that works toward broad-based debt cancellation, and understands its mission is to protect students, not predatory institutions .
It is deeply disappointing that Congress did not act to extend the federal student loan suspension in the COVID relief bill. This increases the urgency for President-Elect Biden to act, both by extending the pause on student loan payments and by cancelling federal student loan debt.
In October, AFR joined 76 other organizations to call on Secretary DeVos to extend the federal student loan suspension. We are glad that Secretary DeVos has heeded this call, extending the suspension through the end of January 2021. But we still need a long term solution. We look forward to seeing the incoming Biden administration extend the federal student loan suspension even further, ensure all federal student loan borrowers are covered, and provide crucial relief to millions by cancelling federal student debt via executive action.