Trump And Biden Cancelled $90 Billion In Student Loan Interest Using Executive Action — Can Biden Do More?

Trump And Biden Cancelled $90 Billion In Student Loan Interest Using Executive Action — Can Biden Do More?

As the Biden administration continues to judge whether or not it’s attainable to enact widespread student loan forgiveness utilizing govt authority, misplaced within the debate is an easy truth: President Biden and former President Trump collectively have already cancelled $90 billion in student loan curiosity utilizing govt motion.

As the COVID-19 pandemic was quickly accelerating in March of final yr, President Trump issued an govt order suspending all curiosity accrual for government-held federal student loans. Weeks later, Congress codified the curiosity freeze when it handed the CARES Act, which continued the suspension of curiosity to September 30, 2020. President Trump then prolonged the curiosity freeze twice extra utilizing govt motion — first to December 31, 2020, after which once more to January 31, 2021. And on President Biden’s first day in workplace, he signed an govt order to increase the curiosity moratorium but once more, this time to September 30, 2021.

In whole, assuming there are not any additional extensions, this quantities to 18 months of suspended curiosity on government-held federal student loans. The U.S. Department of Education launched information earlier this month indicating that this comes out to round $5 billion monthly. Over the course of 18 months, that’s $90 billion in student loan curiosity that has been cancelled.

Amidst rising calls to cancel student debt, President Biden has expressed reluctance to utilizing govt motion, suggesting that widespread student loan forgiveness merely might not be authorized beneath present govt authority, absent enabling laws handed by Congress. But student loan borrower advocates level to the $90 billion in cancellation of student loan curiosity in response to the pandemic as clear proof that widespread student loan forgiveness can, actually, be achieved by way of govt motion alone. During a Senate listening to earlier this month, Senator Elizabeth Warren (D-MA) cited these actions as she argued that the President has authority to cancel student debt.

Student loan borrower activists, advocacy organizations, and Democratic lawmakers have argued that the Higher Education Act provides the President broad authority to launch debtors from their student loans. A particular provision of the statute gives the President, through the Secretary of Education, with the facility to “enforce, pay, compromise, waive, or release any right, title, claim, lien, or demand, however acquired, including any equity or any right of redemption.” Several student loan authorized consultants have argued that utilizing this provision to cancel student loan debt is legally sound.

Advocates have additionally pointed to the HEROES Act, which may present the President, through the Secretary of Education, with authority to “waive or modify any statutory or regulatory provision applicable to the student financial assistance programs” in response to a nationwide emergency. This statute was cited as the premise for extending the freeze on student loan curiosity by each Trump and Biden.

But attorneys beneath former Education Secretary Betsy DeVos concluded that neither the Higher Education Act nor the HEROES Act confers such sweeping authority on the President to easily wipe out the student loan debt of hundreds of thousands of debtors on a mass scale. The attorneys argued that this could violate the intent of Congress when it handed each statutes. In a memo to DeVos, they wrote that the “plain text and statutory scheme” of the related statutory authorities, and the “controlling interpretative canons, compel us to conclude Congress appropriated funds for student loans with the expectation that such loans would be repaid except in very specific circumstances.”

The White House continues to judge choices for broad student loan forgiveness. Earlier this month, the administration introduced that attorneys beneath Education Secretary Miguel Cardona will likely be re-evaluating the potential authorized authorities that might be the premise for widespread student loan forgiveness carried out by way of govt motion. The Department of Education will coordinate its efforts with the U.S. Department of Justice, which can be reviewing attainable authorized avenues for student loan forgiveness utilizing govt authority. It is just not identified at the moment whether or not this new authorized evaluate will result in a unique conclusion.

Further Reading

Why $10,000 In Student Loan Forgiveness May Not Help Borrowers In Income-Based Repayment

New Details: Student Loan Forgiveness Could Wipe Out The Debt Of Most Borrowers

Biden Excludes Student Loan Forgiveness From Budget Proposal, But Calls For More Funding For Higher Ed: Key Details

Key Moments From Elizabeth Warren’s Blockbuster Hearing On Student Loans

4 Key Questions About Biden’s Student Loan Forgiveness Review

Biden To Initiate Additional Student Loan Relief This Week — But Borrowers Demand Full Cancellation

72,000 Borrowers Will Get $1 Billion In Student Loan Forgiveness – Do You Qualify?

Is $10,000 In Student Loan Forgiveness Next, After Biden Administration Cancels $1 Billion?

Senate Passes Stimulus Bill With Student Loan Tax Relief — Will It “Pave The Way” To Cancel Student Debt?

Here’s Everyone Who Wants Biden To Cancel Student Loan Debt (It’s A Big List)

Whether Biden Cancels Student Debt Will Depend On These 3 Things

Could These Student Loan Borrowers Be Excluded From Biden’s Forgiveness?

READ:   Proposal: Cancel Student Loan Debt