Topline
President Joe Biden canceled $7.4 billion of student debt in another round of loan forgiveness Friday, pushing ahead with his signature relief programs in the face of fierce Republican opposition to the issue that’s a flashpoint in the 2024 elections.
Key Facts
Biden said approximately 277,000 Americans will have loans canceled through updates to existing student loan forgiveness programs.
Most of the eligible borrowers are enrolled in Biden’s Saving on a Valuable Education (SAVE) repayment plan, which the White House launched last summer after the Supreme Court torpedoed its debt relief program, as well as people enrolled in the government’s public service loan forgiveness program and on income-driven repayment plans, the White House said.
About $3.6 billion of relief will go to nearly 206,000 borrowers through SAVE, the Department of Education said, with some borrowers eligible for forgiveness after reaching 10 years of payments, a decade earlier than the previous milestone.
Additionally, nearly 66,000 people will get $3.5 billion through administrative changes to income-driven repayment plans, which the education department said will help “address longstanding concerns with the misuse of forbearance by loan servicers.”
The remaining $300 million will benefit 4,600 public servants like some government workers, teachers, military and public health workers through “fixes” to the public service loan forgiveness scheme.
U.S. Under Secretary of Education James Kvaal said the changes will help Americans “who have been making payments on their student loans for at least a decade,” adding that “they have paid what they can afford” and have now earned forgiveness on their loans.
Crucial Quote
“From day one of my Administration, I promised to fight to ensure higher education is a ticket to the middle class, not a barrier to opportunity,” Biden said in a statement accompanying the announcement. “I will never stop working to cancel student debt – no matter how many times Republican elected officials try to stop us.”
News Peg
Student loan relief is a cornerstone policy for Biden and he has managed to cancel more student loan debt than any other president. The announcement came just days after he announced a broader student debt cancelation program. The issue is shaping up to be a crucial dividing line in upcoming presidential and congressional elections. It could prove decisive in key battlegrounds. Surveys suggest many voters consider student loan cancellation an important issue and it’s possible relief could reach borrowers before they head to the polls in November. Despite sizable progress towards wiping loans, Biden has vowed to step up cancellation efforts moving forward. So far, he has been forced to wipe debt in a piecemeal fashion after the Supreme Court tanked sweeping plans that would have erased a total of around $400 billion. The issue is shaping up to be a major legal and political issue, with Biden’s plans already facing major challenges from Republican-led states claiming he has overstepped his authority.
Big Number
$153 billion. That’s the total amount of student loan debt the Biden administration has authorized to be canceled under loan forgiveness programs so far. An estimated 4.3 million Americans have directly benefited from the moves.