The Biden administration plans to unveil a plan to cancel $10,000 in student debt for each borrower, according to a new report by The Washington Post on Friday. Three sources told reporters that the latest plan will have an income cap of $150,000 per year for singles and $300,000 for joint-filers.
The plan is not final, but this is a number far below what activists have pushed for. There’s no clear answer on what this announcement would mean for the payment and interest payment pause that’s been in place since March 2020. Last month, the Department of Education extended the payment pause until Sept. 1—two months before the midterm elections Democrats historically will lose.
Restarting interest payments could easily wipe-out a $10,000 reduction in debt. While the payment pause has been a lifesaver to those hit hard by the realities of pandemic living, experts (and people capable of doing basic math formulas) say pausing interest payments is what has really helped borrowers.
President Joe Biden is scheduled to give the commencement speeches at the U.S. Naval Academy’s graduation and subsequent commissioning ceremonies on Friday as well as at his alma mater, the University of Delaware on Saturday. While such speeches are popular venues to announce philanthropic giving to graduates, the sources told reporters that it’s unlikely to be announced then.
While running to be the head of the Democratic Party, Biden supported cancelling $10,000 per borrower. However, since then, members of his own party have called for at least $50,000 in cancellation. On Monday, the Congressional Black Caucus called for total student debt cancellation.
Polling from February found two-thirds of likely voters support student debt forgiveness. Seventy percent of Black and 76 percent of Latino potential voters support debt forgiveness.
This number is both low enough to insult borrowers and high enough to annoy detractors of debt cancellation. What an accomplishment by the administration.