The Biden White House announced the cancellation of $1.2 billion in student loans for approximately 153,000 borrowers as part of a piecemeal approach after the Supreme Court invalidated a previous plan to cancel $430 billion.
Education Secretary Miguel Cardona emphasized the relief for borrowers who had been paying for a decade, stating, “With today’s announcement, we are once again sending a clear message to borrowers who had low balances: if you’ve been paying for a decade, you’ve done your part, and you deserve relief.”
The Biden administration has now canceled around $138 billion in student debt for nearly 3.9 million people through executive actions, demonstrating a commitment to debt relief for those who haven’t earned it.
“Under President Biden’s leadership, our Administration has now approved loan forgiveness for nearly 3.9 million borrowers, and our historic fight to cancel student debt isn’t over yet,” the announcement stated.
This initiative comes after the Supreme Court rejected a previous attempt to cancel student loans under the Higher Education Relief Opportunities for Students (HEROES) Act, originally intended for veterans of the Iraq and Afghanistan wars but later widened to cover other federal student loans during national emergencies.
Despite the Biden administration’s argument that the COVID-19 pandemic constituted such an emergency, the court ruled against it, citing lack of “clear congressional authorization.”
Consequently, the Department of Education has pursued other loan cancellation strategies through existing programs, including forgiveness for borrowers on income-driven repayment plans, public service workers, and those with disabilities.
The move will “particularly help community college and other borrowers with smaller loans and put many on track to being free of student debt faster than ever before,” the White House said, according to the New York Post.
The latest announcement focuses on borrowers enrolled in the Saving on a Valuable Education (SAVE) program, covering individuals who borrowed $12,000 or less and have been repaying for at least a decade. This move aims to aid community college students and others with smaller loans, aligning with progressive calls for widespread student loan forgiveness.
Critics, mainly from the GOP, argue against such schemes, highlighting the unfairness to borrowers who have repaid loans or never attended college.
Senator Bill Cassidy criticized the administration’s approach, stating it burdens taxpayers and undermines personal responsibility.
“In the last three years, the Biden administration’s Department of Education has put considerable time and resources to prioritize their student loan schemes,” Cassidy said earlier this month. “But they’ve been unable to fulfill their basic responsibilities mandated by Congress and essential to American families.”
