President Biden will forgive some student loan debt and discusses the crisis in Ukraine

President Biden will forgive some student loan debt and discusses the crisis in Ukraine
Photo by Bohdan Komarivskyi / Unsplash

Student Loan Forgiveness

Biden's student loan move was shaped by intense political pressure and a barrage of criticism. Following considerable pressure from members of his own party and a storm of criticism from Republicans.

President Joe Biden said on Wednesday that he would eliminate student loan debt for millions of Americans and prolong a moratorium on repayments throughout the epidemic. His decision, which was influenced by political and economic concerns, came more than a year and a half into his presidency, despite his early campaign promises to many Americans to erase the debt.

"I made a commitment that we'd provide student debt relief and I'm honoring that commitment today," Biden said Wednesday.

But until just one week before the current pay freeze was set to expire at the end of this month, he held off on saying he would extend the suspension for the final time through the end of the year and the November midterm elections. Americans with federal student loan debt were perplexed about how to arrange their monthly budgets and if they would need to start loan payments as a result of the delay.

Furthermore, the president is coming under increasing pressure from members of his own party, with prominent Democrats and advocacy groups publicly pleading with him to break his campaign vow to remove benefits worth much more than $10,000 per person.

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How much in debt forgiveness?

Having previously argued for up to $50,000 in debt forgiveness, Senate Majority Leader Chuck Schumer talked with Biden on Tuesday night and urged him to waive as much of it as possible.

Democratic Senators Elizabeth Warren, Raphael Warnock, and Chuck Schumer also talked with Biden's senior economic advisor, Brian Deese, and his chief of staff, Ron Klain, on Friday.

In the end, Biden declared that recipients of Pell Grants are eligible for debt forgiveness of up to $20,000 and that other borrowers of student loans who do not get Pell Grants will still be eligible for debt forgiveness of up to $10,000.

Both possibilities for forgiveness are available to anyone with an annual income of less than $125,000 or $250,000 for a family. In a hurry, Schumer and Warren released a statement endorsing Biden politically.

"With the flick of a pen, President Biden has taken a giant step forward in addressing the student debt crisis by canceling significant amounts of student debt for millions of borrowers. The positive impacts of this move will be felt by families across the country, particularly in minority communities, and is the single most effective action that the President can take on his own to help working families and the economy," they said.

Rep. Pramila Jayapal, chair of the Congressional Progressive Caucus, provided political cover for Biden by claiming that even if the student loan forgiveness he announced is "not as large as we advocated for," he is still following through on his campaign commitment.

"We applaud the President for this critically necessary and unprecedented action that lifts up working people," she said. "We look forward to working closely with the White House to ensure quick relief to 43 million people through this Executive Order."

Is the President reluctant?

The long-awaited cancellation announcement comes after Biden promised to immediately forgive at least $10,000 in student loans per individual during the campaign. A survey after a poll revealed that Americans were unsatisfied with his management of the economy, however, as the coronavirus outbreak went on and inflation reached record highs.

He has demonstrated a reluctance to make decisions that may be regarded as escalating inflation. The president had also questioned how much debt he could legitimately write off without legislative approval using only his administrative power.

The worst plan, according to former Treasury Secretary Lawrence Summers, who served in the Clinton and Obama administrations, would be to maintain the present moratorium, which favors, among other people, highly compensated doctors, attorneys, and investment bankers.

The NAACP criticized the president when news outlets started to report that Biden was considering wiping off $10,000 of debt per person for people making less than $125,000 per year.

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Biden's proposal

Biden's choice "cannot become the latest example of a policy that has left Black people, especially Black women, behind," the organization's CEO Derrick Johnson tweeted in response to the announcement.

However, following Biden's announcement, Johnson released a second, more reasonable statement in which she said that Biden's proposal brings us one step nearer to the NAACP's ultimate objective of reducing student debt.

There is still work to be done, according to Al Sharpton's National Action Network (NAN), which urged Biden and Congress to cancel more debt and create more possibilities for individuals to prosper financially.

Tackling the Problem

The administration responded to accusations that Vice President Biden's proposal does not do enough to address racial inequities on Wednesday, just hours before Biden's statement, by assuring reporters that they are tackling the problem by raising the amount eligible for Pell Grant applicants.

Biden had been in office for 581 days when the news was made, leaving just 76 days until the midterm elections. Mitch McConnell, the minority leader in the Republican Senate, called the action cynical and disgusting.

Sens. John Cornyn of Texas and Mitt Romney of Utah, both Republicans, referred to it as an election-year gimmick and a means for Biden to buy votes. In response to criticism from both sides, Biden described his strategy as prudent and fair. Biden defended the idea in response to leftists' complaints that the cancellation amount is too low.

All rights belong to ABC News. which is solely responsible for all content.

ABC News Cheyenne Haslett, Rachel Scott, MaryAlice Parks, Mariam Khan, and Zunaira Zaki contributed reporting.

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