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President-elect Joe Biden has endorsed erasing some student loan debt "immediately" upon entering the White House, but he is facing mounting pressure from progressive lawmakers to move further left on the issue.
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Asked Monday whether canceling student loan debt factored into his plans for the economy and would he consider issuing an executive order on the matter, Biden reiterated his support for a provision of the HEROES Act, which the Democrat-controlled House passed earlier this year.
Under that legislation, economically distressed borrowers would immediately have $10,000 in student debt forgiven. The government would also cover monthly loan payments for people with private student loans until September 2021 and forgive $10,000 of their debt.
“Immediate $10,000 forgiveness of student loans, helping people up there in real trouble," Biden said. "They’re having to make choices between paying their student loan and paying the rent. Those kinds of decisions.”
A Biden official later told Fox News that the former vice president does not want to issue an executive order and instead wants Congress to legislate on the matter.
But some Senate Democrats and progressives are pushing for more debt relief: Sens. Chuck Schumer of New York and Elizabeth Warren of Massachusetts have both called on Biden to unilaterally cancel up to $50,000 of outstanding federal student loans per borrower.
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"Biden-Harris can cancel billions of dollars in student loan debt, giving tens of millions of Americans an immediate financial boost and helping to close the racial wealth gap," Warren tweeted last week, referring to both the incoming chief executive and Vice President-elect Kamala Harris. "This is the single most effective executive action available for a massive economic stimulus."
Warren said Biden could use existing executive authority under the Higher Education Act to order the Department of Education to cancel student loan debt. Previous estimates show that proposal would provide total forgiveness to more than 75% of borrowers and partial forgiveness for more than 95%.
"Student loan forgiveness is good, actually," Rep. Alexandria Ocasio-Cortez tweeted Monday. "We should also push for tuition-free public colleges to avoid this huge debt bubble from financially decimating ppl every generation. It’s one of the easiest progressive policies to 'pay for,' w/ multiple avenues from a Wall St transaction tax to an ultra-wealth tax to cover it."
Ocasio-Cortez, the progressive firebrand and New York Democrat, was not alone in pressing Biden to eliminate all student loan debt.
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"With the stroke of a pen, the incoming administration can do more to shrink the racial wealth gap than any other in modern history," Nina Turner, a former Ohio state senator and a co-chair for Sen. Bernie Sanders' 2020 campaign, tweeted. "How? By canceling student debt. ALL OF IT (REMINDER, Black women are disproportionately overburdened by the student debt crisis)."
That sentiment was echoed by Robert Reich, who served as Labor secretary under former President Bill Clinton.
Such sweeping executive action would almost certainly face a legal challenge, and it's unclear whether it could survive. Critics have argued that using such power exceeds the president's authority granted by Congress. Canceling student loan debt would also add to the nation's already-ballooning national deficit, which totaled a record $3.1 trillion for the 2020 fiscal year.
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Outstanding student loan debt has doubled over the past decade, nearing a staggering $1.7 trillion. About one in six American adults owes money on federal student loan debt, which is the largest amount of non-mortgage debt in the U.S. It has been cited as a major hindrance in people’s “economic life” by Federal Reserve Chairman Jerome Powell.
Biden's ability to follow through on his agenda, including providing student debt relief, could be severely limited if the GOP retains control of the Senate, a battle that hinges on two January runoff races in Georgia.
Democrats would need to win both races to secure a 50-50 tie; in that scenario, Harris as vice president could cast a tie-breaking vote to move the Democratic agenda forward.
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