President Joe Biden announced the forgiveness of up to $10,000 in student debt for those who make under $125,000 a year.
“In keeping with my campaign promise, my Administration is announcing a plan to give working and middle-class families breathing room as they prepare to resume federal student loan payments in January 2023,” Biden said in a statement posted on Twitter.
“I’ll have more details this afternoon,” he added.
In addition to up to $10,000 in forgiveness for working and middle-class individuals, Biden’s administration will offer up to $20,000 in forgiveness for Pell Grant recipients.
The freeze on repayments, which was a response to the Covid-19 pandemic, will also be delayed again from August 31 to December 31 marking the seventh extension since March 2020. The White House said that this will be the final extension.
Some prominent Democrats, including Senate Majority Leader Chuck Schumer (D-New York) and Sen. Elizabeth Warren(D-Massachusetts), have urged Biden to forgive an even higher amount – up to $50,000 – to help minorities and low-income students.
“President Biden’s decision on student debt cannot become the latest example of a policy that has left Black people — especially Black women — behind,” NAACP President Derrick Johnson said in a statement. “This is not how you treat Black voters who turned out in record numbers and provided 90 percent of their vote to once again save democracy in 2020.”
Student debt cancellation has caused heated debate over the years. Though it would help millions of Americans, it would also cost the government around $300 billion, not including the $20,000 in forgiveness for Pell Grant recipients.
The high cost to attend college is also an issue. Even will the forgiveness of student debt, the amount of debt would return to current levels in just four years, according to the Committee for a Responsible Federal Budget.
