Menendez Urges Biden To Nix Student Loan Debt As Deadline Looms
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NEW JERSEY — U.S. Sen. Bob Menendez continues to call on President Joe Biden to “cancel student loan debt.” And with a pandemic-inspired deferment period set to expire at the end of January, time is running out before more than a million people across New Jersey are again walloped by payments they can’t afford, he says.
On Tuesday, Menendez – who has been a vocal supporter of nixing student loan debt for millions of Americans – repeated his plea to Biden, urging the president to cancel student loan debt up to $50,000.
According to Menendez, Biden wouldn’t need Congress to make such a move happen if he uses his executive authority through the Higher Education Act of 1965.
The senator’s renewed call to action comes as an emergency deferment period put in place in March 2020 approaches its expiration date: Jan. 31, 2022.
Menendez isn’t alone. This week, groups including Public Citizen, the Student Debt Crisis Center and the Student Borrower Protection Center are hosting a “Week of Action” to push for federal student loan cancellation.
According to Lending Tree, there are an estimated 1.3 million borrowers in New Jersey holding $48.8 billion in public and private student loan debt, with an average balance of more than $33,000 or bills of $310 per month on average. More than 43 million Americans hold a combined $1.6 trillion in federal student loan debt, with more than 9 million borrowers in default.
“For many New Jerseyans, particularly people of color, crippling student loan debt has turned the promise of a college education into a financial burden that plagues them for decades,” Menendez said.
“That financial nightmare existed long before the COVID-19 pandemic laid bare the deep disparities that exist for communities of color and low-income communities,” he continued. “For far too long, incomes have failed to keep pace with the rising cost not only of education but also health care, housing, child care, and other basic living expenses.”
“When you’re barely keeping your head above water, it is nearly impossible to make a dent in your student loan principal,” Menendez emphasized.
Some experts have criticized the drive to cancel student loan debt.
The bipartisan Committee for a Responsible Federal Budget recently argued that canceling student loan debt would be a poor stimulus to the economy. Researchers said that while student loan forgiveness would increase cash flow by $90 billion per year, it would come at a cost of $1.5 trillion.
"Simply extending the current executive action to defer loan repayments and cancel interest would achieve much of the economic benefit of loan cancellation at only a very small fraction of the cost," the committee's report states.
But according to Menendez, bolder moves are needed to level a playing field that's been unfair for far too long.
“Student loan forgiveness has the power to unleash a wave of consumer-driven growth in this country — and President Biden does not need Congress to do it,” Menendez said. "The time is now for the president to use his authority to cancel up to $50,000 in student loan debt. This relief would transform the lives of millions of Americans, especially poor, low-income and minority communities, narrow the racial wealth gap, and provide a much-need shot in the arm to our economy."
See related article: Student Loan Forgiveness Could Change Lives In NJ – Here's How
See related article: Student Loan Debt Is Hamstringing NJ Homebuyers, Experts Say
See related article: NJ Accountant Group Says Student Debt Is A 'Financial Crisis'
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This article originally appeared on the Bloomfield Patch
