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White House seeks ideas on student debt relief as Biden decision looms

Officials from the White House Domestic Policy Council, National Economic Council, Office of Public Engagement and Office of Political Strategy and Outreach are scheduled to attend the meeting.

Asked about the meeting, a White House official said Wednesday, “We are hosting the meeting at the request of the groups, as we have done on a regular basis over the past year.”

Press secretary Karine Jean-Pierre said Tuesday that Biden had made no decision on whether to extend the payment freeze or widespread debt cancellation.

“The Ministry of Education will communicate directly with borrowers about the end of the payment pause when a decision is made,” said Jean-Pierre. On the issue of large-scale debt cancellation, she added, the White House was continuing to “evaluate our options.”

Jean-Pierre reaffirmed on Tuesday that Biden had pledged to make a decision by the end of the month. “He will have something before August 31,” she said.

The Biden administration is widely expected to extend, at a minimum, this payout freeze until at least after the November election, as many top Democrats have urged the White House to do. Education Department officials have already signaled a likely extension of the payment pause by telling lending companies not to send borrowers notices that their payments are resuming.

But the larger issue of a massive loan cancellation program is more complicated. White House advisers have long been divided on the political wisdom and political ramifications of writing off large amounts of student debt. The internal decision-making process has been dragging on for months without a solution.

Administration officials are considering canceling $10,000 of debt for borrowers whose income falls below a certain income threshold. But many progressives, including major labor unions and civil rights groups like the NAACP, want the White House to forgive more debt — up to $50,000 — for all borrowers.

At the Department of Education, officials have been working on plans for how the agency would implement a widespread student loan forgiveness program that would be unprecedented. Ministry officials are exploring how they could automate all loan forgiveness for as many borrowers as possible without requiring them to fill out an application form. They are looking for ways to cancel debt, for example, for borrowers in default and those who have already received a Pell grant.

Republicans have opposed any amount of student loan forgiveness, which they say would amount to unfair aid to many Americans who do not need help and exacerbate inflation in the economy. Some moderate Democrats also said they were uncomfortable with the widespread loan cancellation.

GOP lawmakers have introduced legislation to stop Biden from carrying out widespread loan forgiveness. And they signaled they would aggressively monitor any Biden debt cancellation programs next year if they regain control of Congress.


Politico

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