President Biden said canceling at least $10,000 in student debt would be part of his economic recovery plan, but he has not followed through on the promise.
Debt Collective, an offshoot of the Occupy Wall Street movement, had planned to rally outside the White House to demand that President Joe Biden fulfill his campaign promise and cancel some portion of more than $1.57 trillion in outstanding student loan debt.
After Biden extended the pause on federal student loan payments through May 1, activists declared a temporary victory and reprieve.
Following the extension, Debt Collective canceled its scheduled protest amidst the spreading Omicron variant and claimed that Biden had “caved to our pressure” in a Facebook post.
“Momentum is on our side. Broad-based debt cancellation is the right next step, but it will take the same kind of public pressure to win,” said Thomas Gokey, cofounder of the Debt Collective.
The group announced that it would replace its rally with a virtual strategy session discussing how to hold the president accountable. Cody Hounanian, executive director of the advocacy group Student Debt Crisis Center, said the payment pause’s extension would allow borrowers more time to fight for complete cancellation.
“With last week’s extension, we feel the administration is beginning to better understand the challenges facing student-loan borrowers,” said Hounanian.
He continued, saying broad cancellation “must happen before millions of Americans are pushed back into a system that is clearly broken.”
Advocates push for more
While activists and consumer groups have applauded the payment pause extension, they remain laser-focused on pushing for more.
Biden has repeatedly said canceling at least $10,000 in education debt would be part of his long-term recovery plan following his election.
However, he didn’t include any student loan cancellation as part of his sweeping economic recovery plan, domestic spending bill, sweeping rescue package, and signaled to liberal groups that the issue was not a high priority.
Democratic lawmakers and activists have urged the president to issue an executive order canceling federal student debt.
Some call for $50,000 per borrower, while others pressed for total forgiveness. Proponents say reducing the student loan burden would help close the racial wealth gap as statistics show black borrowers shouldering a disproportionate amount of debt and help stimulate the economy.
According to a recent survey conducted by Education trust, nearly 1,300 black borrowers were polled, with two-thirds of respondents saying they regret taking out loans that they now consider “unpayable.”
Many feel that the federal lending system has exacerbated existing inequality and say the best remedy would be widespread debt forgiveness.
However, the Biden administration has wavered on its position on loan forgiveness, insisting that Congress should deliver a bill crafted to bring the policy to fruition.
“We can’t truly build back better without freeing millions of the economic burdens of student debt, and thankfully with a stroke of a pen, President Biden has the legal authority to do just that,” said Rep. Ayanna Pressley, D-Mass., said recently.
Insiders warn that there is no broad debt cancellation that would be clear of both political and legal challenges.
Members of the Biden administration are torn between the merits of debt cancellation, with many arguing that there are more pressing matters at hand, including an influx of migrants at the southern U.S. border, inflation, and increasing crime rates across the country.
According to Beth Akers, former economic advisor to President George W. Bush and senior fellow at the conservative American Enterprise Institute, “My sense is that Biden doesn’t want to do it anyway, so it doesn’t matter if it’s legal or not. If you go back to the campaign, he was not the first to put in place a loan-cancellation proposal, and his proposal was the most modest of the candidates. He needed to compete with the field.”