United States: The Biden administration is ready to write off USD 7.4 billion in student debt for almost 277,000 borrowers, the White House said on Friday, a move that comes just on the heels of other debt cancellation moves.
President’s Commitment to Young Voters
The day before yesterday, US President Joe Biden said that he had plans to ease student debt that would benefit at least twenty-three million people, and this is a topic on which he needs to support the young voters who are decisive in his campaign for November elections, as reported by Reuters.
Debt Relief Plans
Those plans include at least interest cancellation of up to USD 20,000 for all borrowers irrespective of their income, which the Biden administration believes will be enough to totally eliminate that interest for twenty-three million borrowers entirely.
Targeted Relief Programs
The latest debt relief provides money for 277,000 Americans enrolled in the SAVE plan, those using Income-Driven Repayment plans, and borrowers eligible for PSLF, as per the White House in a statement.
It’s another step after the shedding of USD 6 billion worth of student loans in March, which affected 78,000 borrowers.
Continued Efforts
The White House confirmed Thursday evening it has discharged USD 153 billion in student loan debt to 4.3 million borrowers.
Political Dynamics
Biden, a Democrat, said earlier that he would find other ways to deal with the issue of student loan debt relief after the US Supreme Court blocked his plan to cancel USD 430 billion in the same.
Last March, former President Donald Trump’s campaign, the Republican challenger of Biden for higher office, criticized the student loan cancellation as an act that was done “without a single act of Congress.”
Demographic Concerns
This issue is still on the top of the young voter’s agenda, including those who are concerned about Biden’s policy for Gaza war and who hold him responsible for not solving debts completely.
The Republicans pose that Biden’s student loan forgiveness approach is an overreach of power, and they claim college-educated borrowers exclusively benefited while others did not get the aid at all, as reported by Reuters.
Around half of the total federal student loan debt is owed by individuals with graduate degrees. Brookings Institution research says. As revealed by the department’s report of August 2023, the share of federal student loan disbursements for 2021-22 was 47 percent given to graduate students, who formed only 21 percent of the total borrowers.