Biden Trying To Cancel Up To $50K in Student Debt
Student debt has been an overhang on the economy, and forgiveness programs are politically popular — with voters. They are not as popular with Republicans in the Senate and House of Representatives, which limits the approaches that President Joe Biden has to achieve his campaign promises. He promised to forgive up to $10,000 in student debt; so far, he managed to include a six-month moratorium on payments in the stimulus package passed last month.
One approach for granting forgiveness is an executive order. CNBC reports that Biden has asked Education Secretary Miguel Cardona to prepare a report on the legality of canceling up to $50,000 by executive order or other processes that would bypass Congress.
In her presidential campaign, Senator Elizabeth Warren (D-Mass.) circulated a legal opinion written by members of the Project on Predatory Student Lending at Harvard Law School, saying that the president had the authority to forgive debt by executive order.
The balance owed by 44 million student borrowers is approaching $2 trillion, and about a quarter of these borrowers are in delinquency or default. Others are making payments but not able to buy houses or save for retirement. Many of these loans have interest rates that are higher than current market rates, and there are limits on refinancing and on discharge in the event of bankruptcy.
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