President Joe Biden spoke in the East Room of the White House on June 2, 2022.
Al Drago | Bloomberg | Getty Images
The Biden administration is unlikely to announce a decision to forgive student loans until later this summer, The Wall Street Journal reported on Monday.
More than 40 million Americans burdened with student debt have been eagerly awaiting news after President Joe Biden said in May that he would share his plans for the next few weeks.
The White House’s announcement of the pardon is likely to come in July or August, according to The Wall Street Journal.
The reason for the delay is likely to be intense discussions – and disagreements – among officials over the political and financial factors for canceling billions of dollars in education debt. There is no precedent for such a move.
The country’s $ 1.7 trillion unpaid student loan balance is ahead of credit card or car debt, and a quarter of borrowers are already behind on their payments ahead of the pandemic public health crisis.
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During the campaign, Biden said he supported clearing $ 10,000 from borrowers’ accounts. It will cost about $ 321 billion and completely simplify loans for about a third of student loan borrowers.
Still, there are fears that such a message would cause more frustration and disappointment than anything else. After all, the average debt of education is three times higher, about $ 30,000.
As a result, Senate Senior Democrat Chuck Schumer of New York – along with Sen. Elizabeth Warren, D-Mass., And other Democrats – is pushing for the president to repeal at least $ 50,000 for all.
The NAACP is also talking about how $ 10,000 will not go nearly far for black student borrowers. Wisdom Cole, national director of the association’s youth and colleges department, recently said on Twitter that rejecting just $ 10,000 would be a “slap in the face.”
But no forgiveness would leave all borrowers happy.
Even if $ 50,000 per borrower is wiped out, the 3 million borrowers who are minus $ 100,000 will still be left with large balances.
Many Americans are outraged by the idea of forgiving every student debt, including those who have never borrowed for their education or gone to college. Some Republicans have said they will try to block the president’s efforts to cancel the debt.
Meanwhile, the federal student loan remains on hold until at least the end of August, as part of a pandemic-era relief policy that began in March 2020. Data show that almost all borrowers have stopped making their payments.
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