Democrats in Congress are turning up the heat on President Joe Biden to forgive $50,000 of federal student loan debt per borrower by way of executive order.
Following a CNBC Op-Ed by Sens. Chuck Schumer, D-N.Y., and Elizabeth Warren, D-Mass., arguing for the $50,000-per-borrower relief, the two senators along with House members Ayanna Pressley, D-Mass.; Alma Adams, D-N.C.; Ilhan Omar, D-Minn.; and Mondaire Jones, D-N.Y., introduced a congressional resolution “calling on the President of the United States to take executive action to broadly cancel Federal student loan debt.”
Biden has supported forgiving $10,000 per federal student loan borrower through legislation, not executive order. Congressional members want to change his mind. It’s not clear they will succeed, but Jen Psaki, Biden’s press secretary, tweeted late Thursday that the White House is “reviewing whether there are any steps he can take through executive action and he would welcome the opportunity to sign a bill sent to him by Congress.”
The President continues to support the cancelling of student debt to bring relief to students and families. Our team is reviewing whether there are any steps he can take through executive action and he would welcome the opportunity to sign a bill sent to him by Congress.
— Jen Psaki (@PressSec) February 4, 2021
Debt Relief as Economic Stimulus
In a late morning press conference outside the Capitol, the legislators took turns explaining the urgent need for the relief and the personal and economic benefits it would provide to over 40 million borrowers who owe approximately $1.5 trillion in federal student loan debt.
“Canceling student loan debt is the single most effective executive action that President Biden can take to kick-start this economy,” said Warren.
She added that it would help close the racial wealth gap; lift the economic prospects of tens of millions of young Americans; and increase GDP, homeownership rates, incomes, small-business formation and jobs. She said the estimated cost was about $650 billion but that would be offset by a boost in economic activity.
Does Biden Have the Authority to Cancel Debt by Executive Order?
Jones, a freshman in Congress, says that Biden has the authority to cancel federal student loan debt under the Higher Education Act, the same authority he used to pause federal student loan payments through September 2021.
A letter sent to Warren from the Legal Services Center of Harvard Law School in September affirmed the authority of the president to direct the secretary of education to cancel federal student loan debt, without legislation, under the Higher Education Act.
“Congress has granted the Secretary a more specific and unrestricted authority to create and to cancel or modify debt owed under federal student loan programs,” according to the letter, sent to Warren just before she and Schumer introduced a similar resolution.