Latest White House plan would forgive $10,000 in student loan debt per borrower

White House officials are currently seeking to cancel $10,000 in student loans per borrower after months of internal deliberations on how to write off the loans of millions of Americans, The Washington Post reported, citing three people familiar with the matter.

Those who spoke on the matter requested anonymity because they were not authorized to discuss it and warned that some details of the plan could change before a formal decision is made.

President Biden was expected to make the announcement later this week at the University of Delaware, but the timing changed in the wake of the Texas massacre.

The White House plan calls for reducing debt relief for Americans who made less than $150,000 in the past year or who filed jointly for couples earning less than $300,000. These two groups comprised about 97 percent of student loans in 2019, according to Matt Brunigg, founder of left-wing think tank The People’s Policy Project.

The White House said it had not made a final decision on the matter. Biden said he would make a decision on student loans in the “next couple of weeks” about a month ago, on April 28. “No decisions have been made,” White House spokeswoman Vedanta Petar said in a statement Thursday.

Cancelling a loan of $10,000 per borrower could cost about $230 billion, according to estimates from the Committee for a Responsible Federal Budget, a nonpartisan think tank. The think tank said in March that the suspension of payments cost the federal government $100 billion, while maintenance costs were around $50 billion a year.

CRFB President Maya McGuinness told the Post on Friday that the cancellation rumors “would be popular in the short-term, especially among those who would receive this unexpected windfall … it’s completely at odds with Biden’s own rhetoric about the importance of deficit reduction.”

She added, “The cost of college is far too high but no serious policy maker would say that student debt cancellation is the right solution.”

Biden said at a meeting of Latin American lawmakers last month that he was ready for student loan debt relief. He pledged to cancel loans of at least $10,000 per borrower after Sen. Elizabeth Warren (D-MA) and other liberals floated the idea during the 2020 presidential campaign.

Most of the country’s 410 million borrowers would be eligible for this plan. According to the latest data from the Department of Education, canceling the $10,000 loan for all people with federal student loans will offset nearly a third of borrowers while reducing total debt by at least half to 20%.

The White House plan comes amid Biden’s dwindling popularity, especially among young people. A Quinnipiac University poll released last week found that 61 percent of Americans ages 18 to 34 – the group most likely to have student loan debt – disapprove of the president’s performance, while only 27 percent approve.