(Washington Insider Magazine)-Following considerable pressure from members from his own party and a storm of criticism from Republicans, President Joe Biden said on Wednesday that he will erase student loan debt for millions of Americans and prolong a moratorium on repayments throughout the pandemic.
His decision, which was influenced by political concerns and economic pressures, came more than a year and a half into his administration, despite his campaign promise to rapidly erase debt for many Americans once in office.
But he didn’t declare he would prolong the suspension for a last time to the end of the year — and through the November midterm elections — until just a week before the present payment freeze was scheduled to conclude at the end of this month.
Due to the delay, Americans having federal student loan debt were confused how to plan their monthly budgets and if they would need to begin loan repayment.
Additionally, the president has been under growing pressure from members of his own party, with well-known Democrats and activist groups publicly urging him to recant on his campaign promise to eliminate benefits worth significantly more than $10,000 per individual.
Having previously argued for up to $50,000 in debt relief, Senate Majority Leader Chuck Schumer talked with Biden on Tuesday night and urged him to waive as much of it as possible. Democratic Senators Raphael Warnock, Elizabeth Warren, and Schumer also talked with Biden’s senior economic advisor, Brian Deese, and his chief of staff Ron Klain on Friday.
In the end, Biden announced that recipients of Pell Grants are eligible for debt relief of up to $20,000, and that other borrowers of student loans who do not receive Pell Grants will still be eligible for debt relief of up to $10,000. Both possibilities for forgiveness are available to anyone with annual incomes of less than $125,000 or $250,000 for a family.
Warren and Schumer quickly released a statement backing Biden politically despite not obtaining nearly as much as they had pushed for.
Rep. Pramila Jayapal, chair of the Congressional Progressive Caucus, provided political cover for Biden by claiming that even if the student debt relief he announced is “not as high as we called for,” he is still following through on his campaign commitment.
The long-awaited cancellation news comes after Biden promised “an immediate cancellation of a minimum of $10,000 of student debt per person” when running for office.
Survey after poll revealed that Americans were unsatisfied with his handling of the economy, however, as the coronavirus outbreak went on and inflation reached record highs. He has demonstrated a reluctance to make decisions that may be viewed as escalating inflation.
According to ABC NEWS, the president has reportedly questioned how much loan he could legally forgive using only his executive authority without legislative approval.
The worst option, according to former Treasury Secretary Lawrence Summers, who served in the Clinton and Obama administrations, would be to maintain the present moratorium, which favors, among other people, highly compensated investment bankers, doctors, and lawyers.
He demanded that people with debts under a few thousand dollars and legitimate middle class earners receive debt relief.
The NAACP criticized the president when news outlets started to report that Biden was discussing wiping off $10,000 of debt per individual for people making less than $125,000 per year.
The administration responded to accusations that President Biden’s plan does not do enough to combat racial disparities on Wednesday, just hours before Biden’s statement, by assuring reporters that they are tackling the problem by raising the amount eligible for Pell Grant applicants.
After 581 days in office, only 76 days before the midterm elections, Biden made the announcement.
Mitch McConnell, the minority leader in the Republican Senate, called the action “cynical and outrageous.”
Senator John Cornyn of Texas and Senator Mitt Romney of Utah, both Republicans, referred to it as a “election-year stunt” and a means for Biden to “bribe the voters.”
In response to criticism from both sides, Biden described his strategy as “responsible and fair.”
Biden defended the idea in response to leftists’ complaints that the cancellation amount is too low.