President Joe Biden is forgiving nearly $5 billion in additional student debt as the administration seeks to deliver on one of his signature initiatives with high stakes for his 2024 re-election campaign.
Almost 74,000 student loan borrowers will see debt canceled as a result of administrative changes by the US Education Department in the latest round of relief. Those affected include borrowers enrolled in the government’s income-driven repayment and public-service loan forgiveness programs.
Each program requires at least a decade of payment or service to be eligible for relief. Mismanaged federal student-loan plans have left some borrowers without promised relief after making payments for as long as 25 years.
“My administration is able to deliver relief to these borrowers – and millions more – because of fixes we made to broken student loan programs that were preventing borrowers from getting relief they were entitled to under the law,” Biden said in a statement Friday.
Of those receiving assistance, 43,900 borrowers are public servants and29,700 are enrolled in income-driven repayment plans.
The effort comes as Biden faces pressure from civil rights group, labor unions and advocates for borrowers to expand the scope of a new student debt relief plan after the president’s earlier $400 billion initiative was struck down by the US Supreme Court.
The replacement plan is slated to be much narrower than that original plan that would have forgiven as much as $20,000 in student loans for an estimated 40 million Americans.
Nearly 70 groups, including the AFL-CIO and NAACP, asked Education Secretary Miguel Cardona in a letter Thursday to hold another session in the rulemaking process and to include targeted relief for borrowers who have experienced hardship.
The goal is to allow more young people, people of color and low-income borrowers to be eligible for relief.
Polls show Biden’s support has weakened among Black, Hispanic and young voters who will be crucial to helping him secure a second term.
Since the Supreme Court ruling, the administration has made amendments to existing federal programs to further provide relief.
The Education Department has incrementally unveiled $136 billion in student-debt cancellation for more than 3 million Americans, including for borrowers who were misled or defrauded by schools.
Copyright Bloomberg News
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