Biden looks at student loan relief, rules out $50K forgiveness sought by some Democrats

President Biden, under sustained pressure from powerful Democrats to erase mountains of student debt incurred by college graduates, suggested this week that he would reach a decision on the matter this spring, but ruled out a $50,000 reduction per borrower.

The $50,000 figure, long advocated by Senate Majority Leader Chuck Schumer, a New York Democrat, has faced skepticism from Republicans and some centrist Democrats, who argue sweeping loan forgiveness would benefit the well-off more than the working poor.

As a White House hopeful, Biden called for scrapping $10,000 in federal student loans per borrower, but he has moved cautiously on the issue in his 15 months as president.

Schumer said on the floor of the Senate on Wednesday: “I think the president is moving in our direction,” adding that his talks with Biden on the issue had been “very fruitful over the last little while.”

Biden responded to Schumer’s remarks in a White House news conference one day later, saying, “I am considering dealing with some debt reduction. I am not considering $50,000 debt reduction.”

The president said he remains in “the process of taking a hard look” at student debt forgiveness and will “have an answer on that in the next couple of weeks.”

He did not put a specific number on his plan, nor did he say explicitly whether he was eyeing executive action. But Bloomberg News reported Friday that the Biden administration is considering at least $10,000 in loan forgiveness per borrower through executive decree.

The White House did not immediately reply to a request for comment on the report.

Biden has repeatedly extended a student loan payment freeze for some 40 million American debtors. This month, he pushed the pause through the end of August.

He also commissioned the Education Department to review whether he has the legal authority to snuff the debt through executive action, bypassing Congress.

In December 2020, Schumer published an op-ed with Sen. Elizabeth Warren, a Massachusetts Democrat, saying that the president has the capacity to make the move, and calling on Biden to do it on Day One of his presidency.

“We have proved conclusively to ourselves that it’s OK, that they can do it,” Schumer said in a Manhattan news conference last April. “They want to be careful, that’s fine, let them keep studying it — but not for too long.”

The White House press secretary, Jen Psaki, said Thursday there had been “no conclusion of any process” to determine whether Biden has the authority to clear the debt through executive action.

“He would be happy to sign a piece of legislation or a bill that came to his desk that canceled $10,000 in student loans,” Psaki said in a news conference. “Could be more than that. We’re looking at that.”

Schumer has said Biden knows he has the authority, and should act.

In a statement on Friday, Schumer said millions of Americans “have been crushed by student loan debt, greatly impeding their ability to begin careers and build the financial resources needed to rent apartments, buy homes, start families or just simply build their futures.”

He suggested that relieving the debt load will also lift New York’s economy.

Republicans, meanwhile, have cast debt cancellation as a handout for middle-class graduates. Sen. Mitt Romney, a Utah Republican, tweeted Wednesday that broad loan forgiveness would amount to a bribe.

“Other bribe suggestions: Forgive auto loans? Forgive credit card debt? Forgive mortgages?” Romney wrote.

Sen. Bernie Sanders, the progressive Vermont independent, shot back in his own post that Romney “supports ‘bribes’ in the form of tax cuts for the wealthy and billions in welfare for corporations, but is shocked by the idea that working Americans might get help paying off student debt.”