Biden should cancel student debt for all borrowers: attorneys general

  • Eight state attorneys general have urged Biden to cancel each borrower’s federal student debt.
  • They wrote that in their roles they saw the consequences late payments can have.
  • Biden said he will make a decision on debt relief in the coming weeks, but it will likely be limited by income.

State attorneys general have joined the fight for broad student loan forgiveness.

On Wednesday, the attorneys general of New York, Hawaii, Illinois, Michigan, Minnesota, New Mexico, Puerto Rico and Washington wrote a letter to President Joe Biden urging him to cancel federal student debt “for every borrower.”

They wrote that, in their roles, they saw the burden student debt can have on borrowers who fall behind on payments. This includes garnishing wages and garnishing federal benefits, for which Biden can provide permanent relief by canceling that debt.

“Resuming federal student loan payments, rather than forgiving them permanently, will only make matters worse,” they wrote. “While pushing back reimbursement restarts and trying to tackle past forbearance abuses is helpful, it’s not enough.

“Now is not the time for half measures, extensions or patchwork solutions,” they added. “Now is the time to act decisively.”

State attorneys general have already fought to protect student borrowers. In January, 39 of them reached a $1.85 billion settlement with major student loan company Navient over accusations the company misled borrowers and pushed them into deeper debt. , which Navient denied. And now, with Biden saying he will make a decision on student loan relief in the coming weeks — before student loan payments resume after Aug. 31 — they join Democrats in Congress in calling for a broad relief for every federal borrower.

Based on recent reports, it appears not all borrowers will have access to the relief Biden may implement. White House press secretary Jen Psaki told reporters Tuesday that Biden is considering helping student loan borrowers earning less than $125,000 a year, and while that would help the majority of borrowers, lawmakers pushed back the ceiling on relief.

“I don’t believe in a threshold, especially for so many frontline workers who are drowning in debt and would likely be excluded from aid,” New York Rep. Alexandria Ocasio-Cortez told The Washington Post. .

And while Biden has yet to comment on the pardon amount, he said he was not considering $50,000 in relief, which progressives have been calling for. Data recently released by Massachusetts Senator Elizabeth Warren’s office revealed that while each forgiveness amount will make a difference, the more the better – while $10,000 of relief would erase the debt burden for a third of borrowers and 2 million black borrowers, $50,000 in forgiveness would zero the balances of 30 million borrowers.

“Forgiving federal student loan debt will reduce stress and mental fatigue, free families to invest in new homes and new lives, and provide countless opportunities,” the attorneys general wrote. “And because student loan debt exacerbates the racial wealth gap, widespread student loan debt forgiveness is not just a matter of economic justice, but also racial justice.”

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