Biden declines to cancel all student debt, supports only minor loan relief

[loomer]

Biden Says He Is “Unlikely” To Cancel $50,000 In Student Loan Debt By Executive Order

Biden made his first public comments today in response to an ongoing campaign by progressive Democrats and consumer advocates to convince the President-Elect to enact sweeping student loan forgiveness.

Speaking candidly to The Washington Post and others in the media about the challenges he will face in January and the limitations of his executive power, Biden said, “I’m going to get in trouble for saying this . . . it’s arguable that the president may have the executive power to forgive up to $50,000 in student debt... Well, I think that’s pretty questionable. I’m unsure of that. I’d be unlikely to do that.”

Earlier in the day, Biden had reaffirmed his general support for broad student loan forgiveness, but suggested that he would support a smaller amount of $10,000.

Last week, Rep. Ayanna Pressley and other House Democrats introduced a resolution calling on Biden to cancel $50,000 in federal student loan debt for every borrower using executive authority. Senate Democrats, led by Senators Elizabeth Warren and Chuck Schumer, had introduced a similar resolution earlier in the year.

A diverse coalition of 237 civil rights and consumer protection organizations, including the NAACP and several national labor unions, sent a letter to Biden in November, urging him to use executive authority to cancel federal student debt when he assumes office in January.

“President-Elect Biden can— and should— cancel student debt on Day One of his presidency,” said Ashley Harrington, federal advocacy director and senior counsel at the Center for Responsible Lending, at the time.

The organizations, and several Democrats in Congress, have argued that the Higher Education Act provides the President with broad authority release borrowers from their student loans. Some student loan legal experts have argued that using this provision to cancel student loan debt is legally sound. But others have expressed concern that such executive action could face serious legal challenges as an overreach of executive authority.

Forgiving $10,000 in student loans would eliminate all outstanding student loans for over 16 million people, or a third of all current student loan borrowers. That level of student loan forgiveness would also reduce the balances of another 9.3 million people by half. Ultimately, over 50% of outstanding student loan borrowers could see significant relief with just $10,000 in student debt cancellation.

Nevertheless, Biden’s comments will disappoint Warren and other consumer rights advocates who have been pushing for broader student loan relief. Warren had also proposed $50,000 in broad student loan forgiveness during her own presidential run, and noted that this level of student debt cancellation could significantly benefit nearly 95% of borrowers.

Student borrower advocacy organizations are not giving up and believe Biden is still persuadable, particularly in light of the recent announcement of his nominee for Secretary of Education, Miguel Cardona.

“We know that hope is not enough,” said Natalia Abrams, executive director of Student Debt Crisis, earlier today. “We will work tirelessly to ensure that Secretary Cardona uses his power and legal authority to cancel student debt on Day One.”

Source

[Solauren]

The question is - does he have the authority to do that?

Yes, as POTUS, he could executive order away any debts owed for education, for loans granted by the United States federal government.

However, he couldn't do that for any other student debts. i.e loans from educational facilities, state governments, or banks.

In fact, if I was a private lender, and the POTUS ordered that, my reply would be "If you want them to have zero debt, the you pay it off for them"


Biden would be better off setting up a program where people with student debts can apply, and the federal government would pay the debt off.

[Raw Shark]

Speaking as a guy who worked my ass off to pay back my student loans, I want to be reimbursed for that if the millennials get off the hook.

[GuppyShark]

Millenials are kids who graduated around 2000, so born in the 80s. I don't know how long student debts typically take to pay off in the US, but this is mostly going to affect Gen Y/Z (oh and every future generation).

[Raw Shark]

Millenials are kids who graduated around 2000, so born in the 80s. I don't know how long student debts typically take to pay off in the US, but this is mostly going to affect Gen Y/Z (oh and every future generation).

Whomever those little asshats are, I want my share of the freebies and they need to stay off my lawn.

[Napoleon the Clown]

Millenials are kids who graduated around 2000, so born in the 80s. I don't know how long student debts typically take to pay off in the US, but this is mostly going to affect Gen Y/Z (oh and every future generation).

Time to pay off depends on various factors. There are a lot of millenials that have outstanding student loan debt whether from a late start into college or having so much debt that paying it off faster than it accrues interest is... infeasible without a fucking amazing job. We were sold on the myth that college is the only path forward, and federal funding for college (as well as state level, to be honest) has been piss poor for quite a while. Add to that, student loans often cannot be discharged through bankruptcy (or at least not easily) and parents often times have had to cosign the loans and there's student loan debt owed for people who are dead.

Student loans generally have fucking insane interest rates, too. It is not difficult to find cases of people who have never missed a payment that owe more now than when they took out the damn loans.

Discharging of every possible penny of student loan debt possible would do wonders for the economy because there are people paying a rather substantial amount per month just to not default. It wouldn't immediately benefit the rich fucks, though, so significant relief is basically a non-starter.

[LadyTevar]

I don't care how many people have paid off their debts. This attitude "I had to do it, they do too!" is one of the problems with getting shit done.

[Raw Shark]

I don't care how many people have paid off their debts. This attitude "I had to do it, they do too!" is one of the problems with getting shit done.

I don't see anybody saying they should have to pay it like I did. My feelings are that if they don't have to pay it, I want my money back.

[Solauren]

How long ago was your student loan, and how much was it, for what degree?

Now, look up how much it would cost for a student to get that same degree.

What's the difference?

(Because, depending what it is, you might have a point, or you might have a joke)

[Raw Shark]

What's the difference?

About $80,000 for my alma mater. I'm not asking for that much back, just what I paid. It's a joke either way, I know it's never going to happen.

[Broomstick]

I'll take cancelling $10k in student debt over nothing at all. Yes, I think a more generous deal would be better, but although Trump is leaving office that doesn't mean the US has been entirely remade. There are still a lot of the toxic, selfish assholes that lead to Trump being elected in the first place in power.

Sure, I paid my own student loans out of my own pocket. 30 years ago. When "minimum wage" was a livable wage and I was able to pay them off in the originally agreed upon 10 years while putting a roof over my head and food on my table. These days minimum wage isn't nearly enough to do that, student debt is an order of magnitude higher, and the deck is stacked against many.

Let's see about getting 10k cancelled to start if that's actually something that might happen. Then we can lobby for more.

[Civil War Man]

I don't care how many people have paid off their debts. This attitude "I had to do it, they do too!" is one of the problems with getting shit done.

I don't see anybody saying they should have to pay it like I did. My feelings are that if they don't have to pay it, I want my money back.

I have seen people who have made the "I paid for it, so no forgiveness for anyone" argument. However, I find most people who advance the argument that forgiveness is unfair to people without debts are corporate toadies who want people poor and desperate so they can be easily exploited, smug boomers who paid for college with a part-time summer job, rich people who are all "but what about people who didn't have to take out loans?", and conservative veterans who enlisted so the government would pay for their college.

[MKSheppard]

Student loans generally have fucking insane interest rates, too. It is not difficult to find cases of people who have never missed a payment that owe more now than when they took out the damn loans.

You know, there's this thing on the internet called loan interest calculators that let you figure out how much you're gonna owe and when so you know before you sign everything...

[Broomstick]

The problem is that student loans and tuition are such that for many people if they don't take out loans they don't go to school, and they have few to no choices about the loans to do that.

[Solauren]

The problem is that student loans and tuition are such that for many people if they don't take out loans they don't go to school, and they have few to no choices about the loans to do that.

Combine that with taking the loan, and how useless some degrees are (A friend of mine that has an art history degree says he's now qualified to teach art history, nothing else, and owes $30G in loans), or how hard it is to get a job sometimes, you basically end up with a class of wage-slaves that were sold a golden ticket on post-secondary education, and turns out, it's made of Pyrite (Fool's Gold)

[Napoleon the Clown]

The problem is that student loans and tuition are such that for many people if they don't take out loans they don't go to school, and they have few to no choices about the loans to do that.

That's not entirely true... There's also the option of joining the military and risking life, limb, mental health, and your morals. That's honestly probably a factor in why there's so little federal interest in making school more affordable. Suddenly it would be a lot to recruit people to join the military.

But in all honesty... Yeah, for a lot of people options are severely limited. School's expensive and getting enough money to go, even with community college the first two years and Pell Grants, it's financially unattainable for many people without going into debt. Damned if you do, damned if you don't.

[Broomstick]

The problem is that student loans and tuition are such that for many people if they don't take out loans they don't go to school, and they have few to no choices about the loans to do that.

That's not entirely true... There's also the option of joining the military and risking life, limb, mental health, and your morals.

Except ... a lot of people can't pass a military physical for reasons that can't be fixed (i.e. "lose weight and get in shape"). Bad vision? Bad hearing? Type 1 diabetic? You might be able to stay in the service if you develop problems, but if you have problems before you sign up, nope they won't take you. So that option is closed off for a lot of people.

There's also the issue of older folks who lost a job/career being told to go back to school - at the time that happened to me I was beyond the age cut-off for the military.

After I was laid off in 2007 I had a LOT of people tell me "go back to school". Looking back, I'm really glad I didn't do that. I had to give up flying and scale down my lifestyle to accommodate less income, but at least I'm in a position where I have no debt and can sustain myself at a decent level. A lot of older folks who took out loans to go back to work and didn't get a job are now thoroughly screwed.

That's honestly probably a factor in why there's so little federal interest in making school more affordable. Suddenly it would be a lot to recruit people to join the military.

That, and oligarchs profiting from loans that can't ever be discharged in bankruptcy.

But in all honesty... Yeah, for a lot of people options are severely limited. School's expensive and getting enough money to go, even with community college the first two years and Pell Grants, it's financially unattainable for many people without going into debt. Damned if you do, damned if you don't.

Also, as I pointed out - when I went to college, college simply didn't cost as much, even for a "useless" degree. (I actually have gotten a surprising amount of mileage out of my fine arts degree, which I also want to mention is NOT "art history"). Back when I went you could get a "useless" degree, something in the arts or liberal arts, and if it turned out not to be what you wanted you had the time and ability to recover and do something else. Or at least just get out of debt without needing a six-figure income.

The rules have very much changed. Too many in prior generations don't understand that. Now we have the economic disaster of covid which is going to have all sorts of fallout going forward. Very ugly time for the young folks (and not that much better, if better at all, for us old farts).

[Solauren]

That, and oligarchs profiting from loans that can't ever be discharged in bankruptcy.

Perhaps that's what is needed then.

Let bankruptcy cover those loans. You might have to put laws in place to prevent abuse of that change (I'll leave that to someone else to figure out), but that could be the solution.

[Napoleon the Clown]

The problem is that student loans and tuition are such that for many people if they don't take out loans they don't go to school, and they have few to no choices about the loans to do that.

That's not entirely true... There's also the option of joining the military and risking life, limb, mental health, and your morals.

Except ... a lot of people can't pass a military physical for reasons that can't be fixed (i.e. "lose weight and get in shape"). Bad vision? Bad hearing? Type 1 diabetic? You might be able to stay in the service if you develop problems, but if you have problems before you sign up, nope they won't take you. So that option is closed off for a lot of people.

There's also the issue of older folks who lost a job/career being told to go back to school - at the time that happened to me I was beyond the age cut-off for the military.

After I was laid off in 2007 I had a LOT of people tell me "go back to school". Looking back, I'm really glad I didn't do that. I had to give up flying and scale down my lifestyle to accommodate less income, but at least I'm in a position where I have no debt and can sustain myself at a decent level. A lot of older folks who took out loans to go back to work and didn't get a job are now thoroughly screwed.

I was being a bit flippant there... I wouldn't be surprised that most people who do enlist still don't get enough to actually get a degree without debt anyhow. It's 100% predatory from top to bottom.

Going back to school for you probably would have been 4 years of your life with limited income potential during that time and there are only so many "useful" degrees right now. And what's useful can change so damned fast that you might have started in something that had potential and by the time you had the degree the market was saturated. And then there's age discrimination...

That's honestly probably a factor in why there's so little federal interest in making school more affordable. Suddenly it would be a lot to recruit people to join the military.

That, and oligarchs profiting from loans that can't ever be discharged in bankruptcy.

Or, if parents cosigned, death potentially. See: predatory above

But in all honesty... Yeah, for a lot of people options are severely limited. School's expensive and getting enough money to go, even with community college the first two years and Pell Grants, it's financially unattainable for many people without going into debt. Damned if you do, damned if you don't.

Also, as I pointed out - when I went to college, college simply didn't cost as much, even for a "useless" degree. (I actually have gotten a surprising amount of mileage out of my fine arts degree, which I also want to mention is NOT "art history"). Back when I went you could get a "useless" degree, something in the arts or liberal arts, and if it turned out not to be what you wanted you had the time and ability to recover and do something else. Or at least just get out of debt without needing a six-figure income.

The rules have very much changed. Too many in prior generations don't understand that. Now we have the economic disaster of covid which is going to have all sorts of fallout going forward. Very ugly time for the young folks (and not that much better, if better at all, for us old farts).

I think a lot of people refuse to believe that the ladder has been pulled up behind them and that they have - gasp - privilege! It might mean that they're not as amazing and great as they believe they are.

I'm damned lucky that my college loans are under $30k. My major is in something with decent enough earning potential that I should be able to pay it off without too much trouble. And I fully recognize there are a lot of people who did not have the opportunities I did.

[Ace Pace]

That's not entirely true... There's also the option of joining the military and risking life, limb, mental health, and your morals. That's honestly probably a factor in why there's so little federal interest in making school more affordable. Suddenly it would be a lot to recruit people to join the military.

There's an interesting U.S. Military History book on turning the U.S. army into a professional organization in the 70s. Among many other things, it counts education important factors to convince people to sign up.

However, the studies done by the U.S. Army showed that while that factored into a decision to enlist, the majority of reasons to re-enlist or leave actually related to living conditions, social factors and salary (last!).

The U.S. military can also incentivize education in many other methods that do not rely on them providing generous student loans.

[Elheru Aran]

The U.S. military can also incentivize education in many other methods that do not rely on them providing generous student loans.

Point of order. The GI Bill provides grants, not loans IIRC. So the military is one route to a debt free education, albeit one with a significant commitment.

[aerius]

Sure, I paid my own student loans out of my own pocket. 30 years ago. When "minimum wage" was a livable wage and I was able to pay them off in the originally agreed upon 10 years while putting a roof over my head and food on my table. These days minimum wage isn't nearly enough to do that, student debt is an order of magnitude higher, and the deck is stacked against many.

Let's see about getting 10k cancelled to start if that's actually something that might happen. Then we can lobby for more.

The cost increase in education is something else, and makes the medical industry look like chumps.

[bilateralrope]

So how long would it take the student debt problem to get back to where it is now ?

Both with a $10,000 relief and a $50,000 one.

I'm not going to say that this debt relief would be a bad idea. Just that it's only a temporary fix.

[MKSheppard]

Solution is to force companies to stop requiring college degrees for jobs, allowing the job market to reach equilibrium again.

One way you could do this is by the way that the US Government got car makers to standardize on a unified shifting pattern for transmissions, is simply making them major requirements for USAJobs.

We need an intermediate step between:

High School Diploma:
{NOTHING}
College Degree

For the actual tasks that most jobs require these days, now that HS Diplomas have become watered down pieces of shit.

It would be nice to be able to take a year's worth of study and a couple of credit-hours to get specific certification in various fields; rather than having to submit to four years of full time schooling (which makes it only worthwhile for young 18-20 year olds to take).

You'd still need College Degrees; it's just...you don't really need a four year history degree to actually do most jobs in a museum or educational establishment, for example...

[Broomstick]

I graduated college in 1988 and correcting for inflation I had $13,400 in debt.'

All dollars adjusted for inflation:

Federal minimum wage was worth (again, correcting for inflation) about $8.50 in today's dollars, which doesn't sound great but I could cover all my housing costs (rent AND utilities) for $535 in today's dollars. Full time work at 40 hours a week would net you (after taxes) about $1200. Subtract rent and utilities leaves $643 for everything else. Let's say $70/week for food and sundries, that leaves about $340 everything else. The student loan payments (yes, I actually looked it up, I still have that information) came to about $245/month. That leaves $95/month above and beyond cost of living and the student loan. So back in my day it actually was a very feasible thing to pay off on schedule. I did take a deferment during an extended period of unemployment, but once past that I was making comfortably more than minimum wage, increasing every year for awhile so in reality I had more than just $95 a month after the CoL and loan payment.

As noted - the cost of education has soared way, way above the rate of inflation. You just can't do what I did these days. Federal minimum wage in 2020 dollars is just $7.25 an hour, meaning it's worth LESS than it was around 1990. Housing has also risen higher than inflation - a studio apartment equivalent to what I had in Chicago in 1988 costs around $860 in today's dollars here in the 'burbs (I looked up my old apartment building last year - my old apartment now goes for $1100 in 2020 dollars! Double!) and utilities are no longer included. Need I go on further? This is why so many simply can't get out from under that student debt.