President Biden announces plan to cancel up to $20k in student loan debt 

The Biden administration on Wednesday announced a plan to cancel $10,000 in student loans for some students who are earning less than $120,000 per year and up to $20,000 for Pell Grant recipients.

President Joe Biden said on Twitter: “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.”

Whilst this forgiveness would be the largest level to date, many Democrat lawmakers have requested student loan forgiveness ranging from $50,000 per student to the entire amount.

Alexandra Ocasio-Cortez (D-NY) pressed Biden to do more on student loans. “$10k means tested forgiveness is just enough to anger the people against it *and* the people who need forgiveness the most,” Ocasio-Cortez tweeted Friday. “$10k relieves most the people who owe the least. What relief is there for the most desperate? For them, interest will undo that 10k fast. We can do better.”

Sen. Elizabeth Warren (D-MA) mentioned student loan forgiveness on several occasions during her appearance CBS’ “Face the Nation” last month. 

“We’ve got millions of people across this country who say they’re not ready for their student loan payments to resume, that they simply can’t manage those loan burdens,” Warren said on April 24 “… As Democrats, we need to deliver. We need to hit costs head on and we have the power to do that. We’ve got less than 200 days left [before the midterms], though.”

Payments have not been made on most federal student loans since March 2020, when a freeze was put in place due to the Covid-19 pandemic. Biden has extended the freeze on four occasions, most recently in April, stating that it was necessary to allow federal student loan borrowers to recover again.

Some Republicans have hit out at the plan to forgive student loans and said it was not the responsibility of the US taxpayer to fund expensive degrees.

“Why should a waitress who didn’t attend college pay the student loan debt of a lawyer making $300,000?” Sen. Tom Cotton (R-AR) tweeted Friday. “This is exactly what will happen under Biden’s student loan transfer plan.

“There’s no such thing as student loan ‘forgiveness,’” Cotton added. “There’s only transferring the debt from those who took the loans (and benefitted) to those who didn’t attend college or responsibly paid off their debts.”