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Biden: I Support Cancelling $10,000 In Student Debt And “Eliminating Interest”

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At a CNN town hall last night in Milwaukee, President Biden spoke on student debt.

In response to a question about whether he would favor $50,000 in student loan forgiveness per borrower, Biden said that he would not support that amount, and would “not make that happen.” Biden suggested he was against a larger amount of student loan forgiveness because it would benefit borrowers who went to more expensive and elite private universities, “like Harvard and Yale and Penn.” And he expressed concerns that the costs associated with a higher amount of student debt cancellation would make it harder to enact other policies, like free community college and early childhood education.

However, Biden accepted that student debt can be “debilitating.” The President reiterated his support for $10,000 in student loan forgiveness, an amount that he has consistently supported since his presidential campaign. And he indicated that his administration would support more pathways to eventual loan forgiveness for borrowers with larger student loan balances, particularly for borrowers who engage in volunteer work or pursue public service careers.

Most notably, Biden expressed support for capping or even eliminating interest on student loan debt. “We should be eliminating interest on the debts that is accumulating,” he said during the town hall event, although he did not provide a more specific policy proposal. Eliminating interest has become an increasingly popular idea among some student loan borrower advocates, who argue that capping interest would dramatically lower the cost of repayment for millions of borrowers.

On his first day in office, President Biden issued an executive order extending the freeze on federal student loan interest to September 30, 2021 — suggesting he is well aware that he has the authority to suspend interest.

Nevertheless, Biden’s statement at the town hall amounted to a clear repudiation of the push by progressive Democrats — including Senate Majority Leader Chuck Schumer (D-NY) — and hundreds of consumer advocacy and civil rights organizations to convince him to cancel $50,000 in student loan debt per borrower. Some progressive Democrats expressed concern about Biden’s comments.

“The case against student loan forgiveness is looking shakier by the day,” tweeted Rep. Alexandria Ocasio-Cortez (D-NY) following Biden’s remarks. “We’ve got the Senate Majority Leader on board to forgive $50k [in student loans]. Biden’s holding back, but many of the arguments against it just don’t hold water on close inspection. We can and should do it. Keep pushing!”

Proponents of $10,000 in student loan cancellation argue that a smaller level of forgiveness would target the relief towards lower-income individuals. Notably, forgiving $10,000 in student loans would eliminate all outstanding student loans for over 16 million people, or a third of all current student loan borrowers, and would reduce the balances of another 9 million student loan borrowers by 50 percent.

Further Reading

Biden Comes Out Against $50,000 In Student Loan Forgiveness - But Supports This Amount, Instead

Could These Student Loan Borrowers Be Excluded From Biden’s Forgiveness?

Can Biden Cancel Private Student Loans? 3 Options

Biden Supports Cancelling Student Debt, Expresses Openness To Executive Action

Democrats Take New Steps To Pressure Biden To Cancel Student Debt - Will It Work?

Senators Unveil Sweeping Bill To Discharge Student Loan and Medical Debt In Bankruptcy

3 Reasons Why Biden Excluded Student Loan Relief From Stimulus – And What It Means For Borrowers

6 Student Loan Reforms That Are Possible With A Democratic Senate

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