President Biden cancels another $9 billion in student debt

Eva Terry
·2 min read
19
President Joe Biden delivers remarks on student loan debt forgiveness, in the Roosevelt Room of the White House on Wednesday, Oct. 4, 2023, in Washington.
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President Joe Biden announced the forgiveness of another $9 billion in student debt Wednesday, affecting 125,000 borrowers, the White House said in a statement.

So far, the Biden administration has forgiven $127 billion in debt, affecting 3.6 million borrowers, per the White House press release.

The latest $9 billion in loan forgiveness is broken into three categories:

  • “$5.2 billion in additional debt relief for 53,000 borrowers under Public Service Loan Forgiveness programs.”

  • “Nearly $2.8 billion in new debt relief for nearly 51,000 borrowers through fixes to income-driven repayment. These are borrowers who made 20 years or more of payments but never got the relief they were entitled to.”

  • “$1.2 billion for nearly 22,000 borrowers who have a total or permanent disability who have been identified and approved for discharge through a data match with the Social Security Administration.”

Related

In June, the Supreme Court rejected Biden’s plan to offer student loan forgiveness. Due to how costly his proposed program was, “the court held that the administration needed Congress’ endorsement” to move forward, per The Associated Press.

However, on Sept. 29, the Department of Education issued a statement claiming the Secretary of Education has the power to eliminate debt.

The statement referenced Section 432(a)(6) of the Higher Education Act of 1965, which says, “The Secretary may enforce, pay, compromise, waive, or release any right, title, claim, lien, or demand, however acquired, including any equity or any right of redemption.”

The statement continued, “These provisions apply to Federal Family Education Loans (FFEL) and Direct Loans through Sec. 455(a)(1), which states that Direct loans have parallel terms and conditions to FFEL loans.”

It is unclear if the administration plans to try to continue to forgive debt for students currently in school.

Related

Secretary of Education Miguel Cardona said, “It’s normalized in this country that you go to college, you’re expected to pay loans forever. I want folks to be able to buy homes, invest in their local economy, and not look at higher education as a lifetime of debt,” per Business Insider.

CNN attributed the announcement’s timing to the White House wanting “to draw a contrast with the Republican-driven chaos on Capitol Hill, where Republican Rep. Kevin McCarthy was ousted as House speaker Tuesday.”