Biden Planning To Cancel $10K Per Student Loan Debt Borrower: Report

The Biden administration is reportedly planning to address the issue of student loan debt with a plan that would cancel $10,000 of debt per borrower.

What Happened: The Washington Post, citing “three people with knowledge of the matter,” reported the plan follows months of deliberations on how to enact a debt forgiveness without getting congressional approval — cooperation from Capitol Hill has been in short supply after the president’s Build Back Better agenda stalled in the Senate.

More than 41 million borrowers carry student loan debt. The new plan would only cover those earning less than $150,000 in 2021 or less than $300,000 for married couples filing jointly. It is uncertain whether this would be restricted to undergraduates or if it would also encompass debt from student loans taken out for graduate and doctoral studies.

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What Happens Next: Student loan debt repayment was put on hold at the start of the pandemic in March 2020 and is scheduled to resume in August. The Committee for a Responsible Federal Budget, a nonpartisan think tank, estimated that erasing $10,000 of debt per borrower would come with a price tag of approximately $230 billion. Postponing repayments for more than two years already cost the federal government $50 billion per year to maintain.

Biden reportedly planned to announce his student loan debt plan this weekend during a commencement address at the University of Delaware, but that has been postponed following the school shooting in Texas earlier this week. On April 28, he said he would make a decision on the subject in “the next couple of weeks.”

“No decisions have been made yet,” said Vedant Petal, a White House spokesman, in a statement.

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