White House Press Secretary Jen Psaki recently announced that the Biden administration does not plan to extend a student loan repayment standstill, sparking outrage among debt advocates and people who have struggled with student loan repayments for years.
A video of Psaki promising that the administration will soon reveal its plan to pay off student debt circulated on Twitter over the weekend, and has garnered 1.7 million views as of Monday.
“We are still evaluating the effect of the Omicron variant,” Psaki said. “A smooth transition to repayment is a high priority for management.” Administration plan to allow The student debt hold period ends at the end of January. The pause, which was implemented to help borrowers with the economy affected by the pandemic, has been in effect since March 2020.
Tracking Biden from the left (BidenTracking) December 10, 2021
The Biden administration’s announcement comes as lawmakers’ movement to take action on the student debt crisis mounts. Many advocates and borrowers expressed frustration with the administration’s failure to act.
“I am angry that Biden has backed away from a key pillar he ran on: repeal. I fear the end of [the] A moratorium would do the trick for a lot of people,” Debt pool member Wen Zhuang wrote. else Twitter users note Allowing payments to start during a crucial election year is a bad strategy for the country’s top Democrats.
Progressive Congress Bloc The White House called for action“45 million Americans are stuck in a student debt trap. It prevents them from buying homes, raising families and investing in their communities,” he said. [President Joe Biden] He has the power to take action today. He should use it, and provide millions with much-needed relief.”
During the campaign, Biden promised to cancel up to $10,000 of student debt for each borrower. But the Biden administration hasn’t just refused to cancel student debt – it’s also to lie about the president’s ability to do so. During press conferences, Psaki has consistently shifted responsibility away from Biden by saying that Congress should pass a debt-clearance bill instead, despite knowing full well that it would. Almost impossible For progressives and Democrats to pass such legislation.
Debt cancellation advocates have repeatedly pointed out that Biden can write off federal student debt with the stroke of his pen, a far more reliable strategy than trying to get the measure through Congress. legal experts We have too He said Biden has the authority to cancel student debt, which may be why his administration hid an Education Department memo on the legality of the measure for months.
Often people are forced to Pay big portions of their income in order to make payments, making student debt a heavy burden on many Approximately 44.7 million Americans who are currently trying to repay the loans. Often, these payments do not seem to have any definite ends; Many borrowers report that they have paid off more than they originally owed, but still owe several times the original loan amount anyway.
These loans also prevent borrowers from being able to participate in them Many parts of the economy. Loans often affect borrowers’ credit scores, jeopardizing their ability to purchase a home or secure housing. Meanwhile, debt cancellation can help raise incomes and stimulate the economy by freeing up thousands of dollars for borrowers.
According to recent data, the vast majority of student debt holders are not ready to make repayments. At the Student Debt Crisis Center Survey of more than 33,000 borrowers, 89 percent of borrowers who work full-time said they were not financially ready to make student loan payments back in February.
Restarting payments will drain borrowers of billions of dollars. A recent report prepared for Senate Majority Leader Chuck Schumer (D-New York) and Senator Elizabeth Warren (D-Mass.) found it Repaying the payments will cost borrowers $7 billion a month and about $85 billion annually. On the other hand, the analysis found that canceling student loans could add more than $173 billion to GDP each year.
Although Biden has refused to respond to calls from lawmakers and activists to cancel student debt, there are steps his administration can take to ease the burden on borrowers. Last month, Warren and Senator Bernie Sanders (I-Vermont) call him The Ministry of Education must get more than 8 million borrowers out of default on their loans before repayments can resume. “Allowing payments and collections to resume without taking these measures to protect delinquent borrowers would undermine our economic recovery,” the lawmakers wrote in a letter.