In a move that has sparked both praise and criticism, the Biden administration announced on Friday that it would forgive $39 billion in student debt for approximately 804,000 borrowers. The debt relief is a result of modifications made to the income-driven repayment programs within the student loan system.
Initially designed to forgive student debt after 20 or 25 years of consistent payments, these programs have fallen short of providing the anticipated relief. Leftist lawmakers and activists have been advocating for extensive student debt forgiveness for years and have persistently urged the Biden administration to take action.
However, critics argue that granting such widespread debt relief is unfair to those who diligently made sacrifices to pay off their loans, especially considering that ultimately, taxpayers foot the bill for any government-funded debt relief initiatives.
The Biden administration has now forgiven a total of over $116.6 billion in student loans for more than 3.4 million borrowers, as stated by the Education Department. The eligibility criteria for student debt relief were interpreted generously, with individuals who had paused their payments, as well as those who made partial or late payments, being included.
The Education Department had previously announced plans to modify the system for student debt forgiveness in April of last year. Eligible individuals will be informed soon regarding whether they qualify for loan forgiveness under the updated rules.
Education Secretary Miguel Cardona emphasized the need to rectify past administrative failures, stating, “For far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness.” He also highlighted the administration’s commitment to leveling the playing field in higher education.
This announcement follows the recent Supreme Court decision that struck down President Biden’s $430 billion student debt relief plan. The court ruled 6-3 that the COVID-era HEROES Act did not grant Biden the authority to cancel billions in student loan debt.
In response to the court’s decision, President Biden expressed determination, stating, “I will stop at nothing to find other ways to deliver relief to hard-working middle-class families.”
It is important to note that the student debt relief announced on Friday is separate from Biden’s plan that was struck down by the court. Vice President Kamala Harris affirmed the administration’s commitment to expanding access to high-quality postsecondary education without burdening individuals with unmanageable student loan debt.