On Monday, when asked by a reporter whether or not student loan forgiveness figures into his economic plan and whether or not he’d take executive action to achieve it, President-elect Joe Biden said something should be done “immediately.”
“They’re in real trouble,” he said of people with loan debt. “They’re having to make choices between paying their student loans and paying their rent, those kinds of decisions. It should be done immediately.”
But Biden did not say whether he would take executive action to cancel student loan debt, as Democrats like Senate Minority Leader Chuck Schumer (D-NY) recently said he could. If Democrats don’t win two January 5 Georgia runoff elections, they will still be in the minority in the Senate, meaning Senate Majority Leader Mitch McConnell (R-KY) could block their proposals. This prompted renewed calls for debt relief (and tuition-free college) from various Democratic leaders, as #CancelStudentDebt began trending on Twitter.
According to Forbes, student-loan debt is the second-largest consumer debt category, clocking in at a cumulative $1.68 trillion — more than 16% higher than at the beginning of Trump’s presidency in 2017, according to CNBC. According to data aggregated by Student Loan Hero, about 45 million people in the U.S. are facing student debt, with monthly payments ranging between $200 and $299 on average for nondeferred loans, and about 11% of borrowers dealing with default or delinquent loans. In response, progressive leaders have been vocal about the need to alleviate this burden to boost the economy.
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In 2019, Senator Bernie Sanders (I-VT), Representatives Ilhan Omar (D-MN), and Pramila Jayapal (D-WA) introduced a plan that would cancel all student debt. In September of this year, senators Schumer and Elizabeth Warren (D-MA) proposed the cancellation of up to $50,000 in student loan debt for federal loan borrowers.
“We believe that Joe Biden can do that with the pen as opposed to legislation,” said Schumer in a recent interview with Anand Giridharadas.
“Biden-Harris can cancel billions of dollars in student loan debt, giving tens of millions of Americans an immediate financial boost and helping to close the racial wealth gap. This is the single most effective executive action available for a massive economic stimulus,” Elizabeth Warren tweeted last week.
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Other progressives in Congress made their stance on the issue clear this week, including members of the growing Squad. Representative Rashida Tlaib (D-MI) wrote on Twitter, “Education is an opportunity that lifts our communities and should not be an anchor that holds us down.” Representative-elect Cori Bush (D-MO) wrote, “Student debt pandemic relief expires at the end of December. January would be [a] great time to go ahead and cancel all of it.”
Meanwhile, Representative Ayanna Pressley (D-MA) made the case for doing so, writing, “Student debt cancelation will ensure an equitable economic recovery from COVID-19, jumpstart our economy & close the racial wealth gap.”
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According to CNBC, Republican lawmakers have criticized plans to cancel student debt, expressing concerns for taxpayers and that it sets a bad example on fiscal responsibility.
"When you say #cancelstudentdebt, you're saying a minority of people who had the advantage of obtaining a degree should have their debt paid off by hardworking taxpayers, 2/3 of whom don't have degrees themselves, or already paid their own student debt off," said Representative Dan Crenshaw (R-TX).
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The proposal’s progressive backers have been clear about how they intend to pay for their plan. The 2019 Sanders-Omar-Jayapal debt cancellation and free-tuition plan sought to fund itself through taxes on Wall Street financial transactions.
Representative Alexandria Ocasio-Cortez (D-NY) wrote on Twitter, tuition-free public college is “one of the easiest progressive policies to ‘pay for,’ w/ multiple avenues from a Wall St transaction tax to an ultra-wealth tax to cover it.”
“If we can provide over $1 trillion in tax breaks to the top 1% and large corporations and $740 billion for the bloated Pentagon, please don't tell me that we cannot afford to cancel all student debt and make public colleges and trade schools tuition-free and debt-free for all,” Sanders tweeted Tuesday.
Want more from Teen Vogue? Check this out: How We Should Understand the Student Loan Debt Crisis