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Joe Biden On Student Loans
Should Joe Biden forgive student loans? That’s the question begging for a clear answer. Last week, Biden revived calls for the government to pay up to $10,000 in student loans per borrower. Loan forgiveness is among his plans to boost the US economy once he sits as President of the United States.
RELATED: Senator Rand Paul: Pay Off Your Student Loans With Your 401k
HEROES Act Provision
Congress passed the Democrat-led HEROES Act in May 2020, as a follow-up to CARES Act. Among the provisions in the $3 trillion is forgiveness of student loans. Under the HEROES ACT, borrowers can have $10,000 in student loans forgiven. The government will also cover monthly payments for private student loans until 2021.
Biden based his support for student loan relief on the original HEROES Act. He said he wants “Immediate $10,000 forgiveness of student loans.” He said the relief was for “helping people up there in real trouble. They’re having to make choices between paying their student loan and paying the rent. Those kinds of decisions.”
Executive Order instead of Legislation
Minority Leader Senator Chuck Schumer and Senator Elizabeth Warren want more. Upping the ante, they suggested forgiving federal education loans up to $50,000 per person. Warren tweeted: “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. This is the single most effective executive action available for a massive economic stimulus.”
Schumer and Warren say that Biden doesn’t even need an act of Congress to get student debt erased. Schumer said that “We believe that Joe Biden can do that with the pen as opposed to the legislation.” In fact, the Higher Education Act empowers the president to cancel student loans without congressional approval. However, the act’s intent is to protect students from fraudulent or bankrupt schools. Using this act to wipe the student debt during the pandemic may not be applicable.
Congress to Do It, not Biden
Whether the Higher Education Act does have the power to do so or not is beside the point. Joe Biden made it clear he does not want to issue an executive order. Instead, he prefers Congress to legislate on the matter. The way that Congress is currently composed, the House will support a student loan bill. However, a Republican Senate may block the bill, or at least pare down the number of those eligible for relief.
Biden did not give any direct statements on the Democrats’ suggestion. He preferred that Congress act on the matter as legislative action. Instead, he proposes creating a program that wipes off $10,000 of student debt per year for up to five years. This will apply to students working in government, schools, and non-profit organizations. Also, previous national or community service qualifies for the relief.
$1.7 Trillion Student Loan
Last Wednesday, 239 nonprofit and community organizations called on Biden to help students. They urged Biden to act “unilaterally” in canceling $1.7 trillion in student loan debt. Doing so can stimulate the pandemic-stricken economy and reduce the racial wealth gap.
In an open letter to Biden and VP-elect Kamala Harris, the group said: “Before the COVID-19 public health crisis began, student debt was already a drag on the national economy, weighing heaviest on Black and Latinx communities, as well as women. That weight is likely to be exponentially magnified given the disproportionate toll that COVID-19 is taking on both the health and economic security of people of color and women.”
But, Will Forgiving Student Loans Help?
Currently, an estimated 46 million Americans have student loans. This makes student debt the second biggest form of household debt after mortgages. Canceling student loans can result in a disproportionate impact on those with the most debt. This means that those with the highest debts are often graduate school students. These students tend to provide better, high paying jobs. Matthew Chingos, VP for education and data policy at the Urban Institute, advises caution. “If you were to just say get rid of all the loans, you’d be giving money to people who got ripped off by their for-profit colleges, but you’d also be giving money to doctors and lawyers,” he said.
Should Biden forgive student debt? If he does by executive action, legal challenges to his authority might arise. David Bergeron of the Center for American Progress thinks the courts might think differently. “If it’s done by executive action there’s a question that swirls around legal authority and what would happen if a court determined that there wasn’t a legal authority. The lenders or the servicers could go to federal court to try to reverse or block the executive action. [If the debt was already forgiven] what’s the harm to borrowers of having it undone, which I see as a real possibility with executive action.” In addition, Bergeron asked about possible tax consequences for borrowers. Would tax implications be different?
Should Joe Biden Forgive Student Loans?
On one hand, student loan forgiveness is a great way to help 46 million Americans reduce their debts. On the other hand, Trump's EO already suspended loan payments until December 31. Then, there’s the matter of how much is a good amount? Is it $10,000 like what HEROES earlier proposed, or should it be $50,000 like Schumer and Warren wants? Or, do we make it the complete debt as pushed by nonprofits? Finally, who should start? Do we wait for Congress to act, or let Biden issue an executive order? The questions are there. Before proceeding with this noble goal, the government should get their acts together.
Watch this as Fox News' Hillary Vaughn reports on President-Elect Biden's proposal to address student loan debt:
Loading ...Do you agree with wiping off student loans? Let us know what you think by leaving your opinions and ideas in the comment section below.
27 Comments
For ppl who cant afford to pay and are needy
Why is this generation getting a pass? I struggled, sacrificed and lived payday to payday while in school. It made me a better person,more independent and accountable.
my wife and I have worked and pay taxes for over 53 years . better not give them a free ride. I did not work and pay taxes to give away my tax dollars.be accountable for what you do.
Nothing in this world is free!! I grew up poor and paid my student loans off by working two jobs, so can everyone else.
They took the class and they should pay for it.
It’s teaching people that they don’t have to work hard or sacrifice to get what they want & that’s what’s wrong with this country….nobody wants to work anymore, they want to make big bucks working the easiest of jobs & want all the handouts they can get!
They took the loans if he wishes to do something make the interest lower. If you can get a mortgage for 3-4% why should a student loan be 10-!!%
Will those who paid off their student loan get paid back?
You knew Underwater Basket Weaving wouldn’t get you a job. Why did you even take it?
I think there should be a limit to the interest rate charged for student loans. Yes, they took the classes and yes they should be responsible to pay back the loans, but the cost of university classes have increased to more than triple when those of us in our 50’s and 60’s went to university. I believe the universities should be accountable for some of these charges. My son pays $1500/year for athletics fees, even though he is not an athlete.
No because in the long run we the tax payers will be the ones that pay for it.
No Name! If you take the LOAN THEN PAY IT BACK IT’S THAT SIMPLE!!!!!!
I could not afford to go to college full time, so I went ONE COURSE AT A TIME, put it on my credit card and WORKED FULL TIME to pay it off. Yes, it took a long time but I have no debt. Those too presumptuous or dim witted to figure it out, DO NOT DESERVE to be bailed out by my hard earned $.
While he’s at it pay for my truck I just bought. Why should I have to pay for it!!!!! I took the loan I knew the interest rate and I agreed to it but why should I be held responsible to pay for when the government can pay for it. How does anyone think this way🤯🤯🤯
They owe the money! If we’re going to give money away give it to the social security account. The system needs the money. The politicians have squandered the social security money for years. People on social security have not received a decent increase ever! Cost of living has increased phenomenally while social security benefits has increased marginally.
Why not forgive my mortgage payment and what about my car payment. A loan is a loan your expected to pay it back. When my daughter asked me if I could loan her $20.00, I asked her if she was going to pay me back the &20.00, she said no, I said I will give you the $20.00,a loan you have to pay it back. Lesson learned
Debt forgiveness is not fair to the parents and grandparents who saved for 18 years and the kids who worked before and after classes and on weekends to pay as they went through school or paid back their loans while living modestly as they did so.
Home loan, 4-5%, foreclosure, Seizable= asset. Student loan no seizable asset = empty space, Absolutely not, grow up and be responsible. NO PARTICIPATION TROPHY HERE!
If you wipe it off who gets stuck paying? Taxpayers!
FUCK HIM WHAT ABOUT MY KIDS WHO SAVED AND PAID THEIR WAY THROUGH COLLEGE, AND WHAT ABOUT ME WHO SAVED AND BORROWED AND HELPED THEM TOO FUCK YOU BIDEN YOU FUCKING PIECE OF FUCKING SHIT ASSHOLE COCKSUCKER
Anyone who knowingly goes into debt of any kind is and should be responsible for that debt.
Only if all students that paid for there in the last 20 years get reimbursed
just the needy.. and NOT TO ILLEGALS.
Yeah, lets all go to college and party at the taxpayers expense… Toga Toga Toga. Toga Toga
Have you people gone mad…
Now, if the “I’m not your president” person will only listen to the public!
How many of our young people could not afford an advanced education, and have struggled to find the right job, lived frugally while learning to be adults, etc? If advanced education is to be free for the ones that had the chance to pursue the advanced education, then it should have been free to all that wanted that education – not in retrospect. Learn to live with your choices!!!!
I have four boys. Three currently in college and one graduated. My older son worked off his student debt by working all through high school and college. The last two years of college he worked full time. My second oldest is currently working fill time as well his last two years. I expect my boys to work hard over summer and they all had and will have college debt. I also went to college and worked to pay off! This does not teach the next generation any principals of hard work. Relying on a pay off is an example of only relying on the government. I already work hard enough for my hopeful retirement some day and I will not pay for others laziness .