The Biden administration recently announced plans to forgive the student loans of more than 800,000 borrowers, resulting in the elimination of $39 billion in debt, according to a U.S. Education Department press release. The action aims to address inaccuracies in payment counts for individuals in income-driven repayment plans, which allow for forgiveness after a certain number of monthly payments, typically 20 or 25 years, The Washington Post reported.
Education Secretary Miguel Cardona stated that this move is intended to rectify the past administrative failures that caused borrowers to fall through the cracks of a flawed system.
"By fixing past administrative failures, we are ensuring everyone gets the forgiveness they deserve, just as we have done for public servants, students who were cheated by their colleges, and borrowers with permanent disabilities, including veterans," Cardona said in a statement. "This Administration will not stop fighting to level the playing field in higher education."
The announcement has drawn criticism from some Republicans, who argue that it goes too far, especially as it follows the Supreme Court's rejection earlier this month of a broader plan by the Biden administration to forgive over $400 billion in federal student loan debt. The previous plan aimed to erase up to $20,000 in loan debt for millions of borrowers within specific income limits. Critics of the initial proposal contended that it unfairly burdened taxpayers with other people's unpaid debt and sought to exploit legislative loopholes for sweeping changes that Congress might not approve, reported the Post.
Despite the setback, President Joe Biden pledged to find an alternative approach using the Higher Education Act to provide relief to borrowers. The need for such action became more urgent as pandemic-related loan payment suspensions are set to resume in the fall, according to the Post.
The plan, announced on Friday, relies on the education secretary's existing authority over loan repayment programs and aims to address concerns about loan servicers improperly placing borrowers into forbearance. Eligible borrowers will be notified of their qualification for forgiveness without any additional action required on their part.
While some critics argue that the administration is overreaching with this decision, others, including experts like Laura Perna—a professor in the Graduate School of Education at the University of Pennsylvania who studies college access and affordability—emphasize the importance of minimizing the long-term harm of student loan debt, considering the significant benefits of higher education to both individuals and society.
"We essentially have a system right now where, if you want to go to college, many students have to borrow. There's not a choice," Perna told the Post. If loans are required, there needs to be a system that minimizes the harm of that long-term debt, she added.
President Biden and Vice President Kamala Harris said Friday that they remain committed to providing relief for student loan borrowers, signaling the administration's ongoing efforts to address the student debt crisis.
U.S. Education Department Press Release
The Washington Post