Biden will soon offer debt relief, but how soon?
As President Biden moves closer to announcing a possible plan to write off some of the $1.7 trillion owed in student debt, rumors of when the final announcement will take place and what might look like politics are spreading, with no predictable response on a likely timeline or final policy.
A the wall street journal A Tuesday report said administration officials had thought an announcement could come as soon as this Saturday, when Biden is expected to deliver a commencement address at the University of Delaware.
However, officials also said no final decision has been made by the president.
A House Democratic aide confirmed with Inside Higher Education that they had yet to hear from the Biden administration that a final debt relief announcement was scheduled for Biden’s keynote address on Saturday. They did, however, say that Biden’s announcement on debt relief will likely be delayed due to the Texas Elementary School Mass Shooting.
With questions about the timing and nature of Biden’s final decision on debt relief, higher education leaders have been given little information on how to prepare for what could be one of the most significant changes in federal higher education policy in decades.
Scott Buchanan, executive director of the Student Loan Servicing Alliance, which represents 95% of loan providers who service federal student loans, said no matter what Biden announces, it could take loan servicers months to implement. administratively Biden’s proposal. Moreover, a lack of communication between the administration and the services left them little room to prepare for such a change.
“If past is prologue, we will have no information in advance. I have hoped and hoped and continue to hope that they will change this practice so that we can actually get advice and be ready to respond to the tens of thousands, if not millions, of phone calls we will receive of borrowers asking what this means for them,” Buchanan said.
Late April, Biden told reporters at a White House press conference that he would make a decision on debt relief in a few weeks. Besides, Biden told reporters that he was not considering debt reduction of $50,000 per borrower, a figure advocated by progressive Democratic senators such as Chuck Schumer of New York, Elizabeth Warren of Massachusetts and Raphael Warnock of Georgia.
Many different proposals have entered the public debate about how Biden should act to write off student loan debt. These include income-based relief, which many higher education experts and Ministry of Education officials declared could impose administrative burdens. The Washington Post reported in April that the administration had considered an income cap excluding borrowers earning more than $125,000 to $150,000 a year.
Biden himself campaigned on a central pledge to provide at least $10,000 in student debt relief per borrower.
Student loan repayments have been halted since the start of the pandemic and are continuing through August. Pressure from Democrats and voters has thrust the topic of student debt forgiveness into the national spotlight and raised many questions about how it will be implemented administratively.
“It’s going to be complicated even if they do it very simply,” Buchanan said. “I think it’s going to be frustrating for borrowers as well, because they’re going to be waiting months for that forgiveness.”
The administrative overload borne by loan managers resulting in delays in borrower forgiveness could have political consequences for Biden, as November’s midterm elections will come just weeks after the scheduled end of the pause on loan repayments. students.
“We all know this is a political decision, not a good political decision, and the real question is, could you do it by November when the election is? Buchanan asked.
Although support for debt relief is consistent among Democrats on Capitol Hill, Republicans have strongly opposed Biden’s push for cancellation, and several lawmakers have questioned Biden’s authority to erase student debt through executive action.
Last week, a coalition of Republican senators introduced a bill it would prohibit the Biden administration from writing off student loan debt. Republicans argue that the power to write off student loan debt rests strictly with Congress.
With Republicans in the minority, several higher education experts said Inside Higher Education that it is unlikely that these proposals will be accepted in Congress. However, some have speculated that a trial could challenge Biden’s executive authority through the court system.
“It’s a legal issue, and it should be settled by the courts. If someone sues and says the president has no power, the question is who would have standing to sue,” said Terry Hartle, senior vice president of government relations and public affairs at the American Council on Education.
Harvard Law School Legal Services released a policy memo at the end of 2020, which stipulated that the President could use executive power to order the Department of Education to cancel federal student loan debt.