. White House Labor Minister Ron Klain said on Thursday the President had asked Secretary of Education Miguel Cardona to prepare a memorandum on the President’s legal authority to cancel student loans.
Earlier, Biden claimed he had no authority to cancel $ 50,000 on student loan debt, saying he would “not do that” in the city hall in February, as other members of his party and developers had demanded. Instead he has expressed interest in canceling up to $ 10,000 and would like to work with Congress, but Klain’s comments on Thursday during an interview with Politico left the door open.
“He is not making a decision that way,” White House Human Resources Manager Ron Klain said in response to a question about the decision. Klain noted that Biden had not yet received an invitation to make a decision.
“I hope, we’ll see that in the next few weeks, and look at that legal authority.” Said Klain.
Student loan debt is over $ 1.7 trillion, according to the Federal Reserve. More than 42 million Americans – about one in eight – have student loans, according to the Department of Education. It is now the second largest family debt in the United States after a mortgage.
On Thursday, Democratic Alliance Senator Elizabeth Warren of Massachusetts – she and Senate Leader Major Chuck Schumer and others unveiled a decision in February to cancel $ 50,000 in debt – continued to put pressure on Biden to end the “nightmares”.
“Canceling a student loan of $ 50,000 is a matter of racial justice. It is a matter of economic justice. It is a matter of justice,” he told a news conference. He will hold a student loan loan hearing later this month.
A report released last month by the JP Morgan Chase Institute found that canceling $ 50,000 on student loan debt with certain income limits would reduce student loan debt by $ 786 billion. It also found that canceling $ 50,000 on student debt brings absolute relief to low-income borrowers, Black and Latinx borrowers and those facing credit risk or long-term overpayment of other small or highly targeted options.
The unions are calling for action on the forgiveness of government employees
Biden administration is also under pressure from unions in the student loan debt segment. On Thursday, a letter from 15 civil service unions to Cardona urged him to take immediate steps to write off student loan debts for all public sector employees who have been in office for ten or more years.
The unions – representing more than 10 million civil servants, including teachers and police – want Cardona to begin reviewing the 90-day Public Service Loan Compensation Program and cancel the debt.
The letter states that since public service employees first qualified for debt cancellation under the scheme in 2017, 98% of applicants have been rejected. They blame a combination of factors including minor regulations, mistreatment by previous administrators and “widespread harassment” perpetrated by the student loan industry.
“This effort is a small foundation needed to bring justice to government employees who have fallen through the cracks of our badly broken student loan system,” the unions said.