Biden Administration wipes out $39B in student debt.

The Biden Administration Announces $39 Billion in Student Debt Forgiveness

The Biden administration made a groundbreaking announcement on Friday, revealing its plan to forgive $39 billion in student debt for approximately 804,000 borrowers. This move comes as a result of significant changes to the student loan system’s income-driven repayment programs.

Under these programs, student debt was supposed to be forgiven after borrowers had made payments for at least 20 or 25 years, depending on their loan. However, very few borrowers have actually benefited from this system and had their loans forgiven.

“These fixes are part of the Department’s commitment to address historical failures in the administration of the Federal student loan program,”

Leftist lawmakers and activists have long advocated for broad student debt relief, urging the Biden administration to take action. However, critics argue that forgiving student debt is unfair to those who diligently paid off their loans, especially considering that taxpayers ultimately bear the burden of government-funded debt relief.

With this recent announcement, the Biden administration has now forgiven a staggering total of over $116.6 billion in student loans for more than 3.4 million borrowers. The administration has been generous in its interpretation of eligibility for debt relief, including individuals who paused their payments and those who made partial or late payments.

The Education Department’s plan to implement changes to the system and forgive certain individuals’ student debt was initially announced in April of last year. The department will soon notify individuals about their eligibility for loan forgiveness under these changes.

“For far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness,”

Education Secretary Miguel Cardona emphasized the importance of rectifying past administrative failures and ensuring that everyone receives the forgiveness they deserve. He highlighted the administration’s commitment to leveling the playing field in higher education, just as they have done for public servants, students deceived by their colleges, and borrowers with permanent disabilities, including veterans.

It is worth noting that this recent student debt relief is separate from Biden’s previously proposed plan, which was struck down by the Supreme Court. The court ruled 6-3 that the COVID-era HEROES Act did not grant Biden the authority to cancel billions in student loan debt.

“Six States sued, arguing that the HEROES Act does not authorize the loan cancellation plan. We agree,”

Despite this setback, President Biden remains determined to find alternative ways to provide relief to hard-working middle-class families. Vice President Kamala Harris echoed this sentiment, stating that the administration will continue to fight for accessible, high-quality postsecondary education without burdening individuals with unmanageable student loan debt.

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