Biden considers executive action to offer federal student loan debt relief – KIRO 7 Seattle News

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WASHINGTON – President Joe Biden plans to take executive action to provide federal student loan debt relief to borrowers nationwide as he continues to call on Congress to take action amid the pandemic of coronavirus in progress.

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In a Twitter post on Thursday, White House press secretary Jen Psaki said members of Biden’s team were considering his options.

“The president continues to support the cancellation of student debt to provide relief to students and families,” she wrote. “Our team is examining if there are any steps he can take through executive action and he would be happy to be able to sign a bill sent to him by Congress.”

The announcement came after Psaki told a press conference that Biden “is calling on Congress to draft the proposal.” Previously, Biden had indicated that he was not sure that as president he would have the power to write off large swathes of student debt.

“I think it’s pretty questionable,” he said in December, according to Politico. ” I’m not sure of it. I probably wouldn’t do that.

A group of Democrats, including Senate Majority Leader Chuck Schumer of New York and Senator Elizabeth Warren of Massachusetts on Thursday urged Biden to use executive action to write off $ 50,000 in debt federal student loan for every borrower. They presented the cancellation of student loans as a social justice issue that would particularly affect students of color and help close the country’s racial wealth gap.

“There’s not much the president can do with the stroke of a pen that will boost our economy more than forgetting $ 50,000 in student debt,” Schumer said Thursday at a conference. press with Warren and other progressive lawmakers pushing for student debt relief. “It’s one of those things the president can do on his own.”

Republicans have opposed proposals to write off student loan debt, saying it unfairly shifts the burden from borrowers to taxpayers.

In a hearing Wednesday with Biden’s choice to lead the Department of Education, Sen. Richard Burr, RN.C., urged the president not to pursue student debt cancellation, which he has described as “dangerous and reckless”. Instead, he called on Biden to work with senators to pass legislation “that dramatically simplifies student loan repayment options, allows borrowers to pay whatever they can reasonably afford, capped at 10% of their discretionary income, and having their loan canceled after 20 years. “

Economists have also questioned whether a decision to write off student debt would have the desired effect. A analysis published in October by the Brookings Institution found that nearly 60% of unpaid student debt was owed by people with household income over $ 74,000, while those with the lowest incomes accounted for just under 20% of the debt unpaid.

In one editorial published in NovemberJames Looney, a former Treasury Department official and senior researcher at the Brookings Institution, said that canceling $ 50,000 in student loan debt for each borrower would cost around $ 1,000 billion and would be one of ” largest transfer programs in US history “.

“And its most important effect would be to improve the finances of workers who have graduated from college, who already tend to be winners in an economy marked by ever-growing inequalities,” he wrote.

Calls for debt cancellation have escalated after years of tuition hikes that have helped inflate national student debt. More than 43 million Americans owe a total of $ 1.6 trillion in federal student loans, The Wall Street Journal reported.

In an effort to provide relief shortly after last year’s pandemic, the administration of former President Donald Trump suspended federal student loan payments and set interest rates at zero percent. When he took office, Biden extended the moratorium until at least September 30.

The Associated Press contributed to this report.

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