SPONSORED:

Biden faces backlash from left on student loans

President BidenJoe BidenObama: Ensuring democracy 'continues to work effectively' keeps me 'up at night' New Jersey landlords prohibited from asking potential tenants about criminal records Overnight Defense: Pentagon pulling some air defense assets from Middle East | Dems introduce resolution apologizing to LGBT community for discrimination | White House denies pausing military aid package to Ukraine MORE is facing intense backlash from progressive lawmakers after saying Tuesday he would not sign a measure to forgive up to $50,000 in federally held student debt per borrower through executive action.

During a CNN town hall, Biden shot down the debt forgiveness plan pushed by top Democratic lawmakers and prominent progressives, including Senate Majority Leader Charles SchumerChuck SchumerFive takeaways on the Supreme Court's Obamacare decision Senate confirms Chris Inglis as first White House cyber czar Schumer vows to only pass infrastructure package that is 'a strong, bold climate bill' MORE (N.Y.), Sen. Elizabeth WarrenElizabeth WarrenDemocrats have turned solidly against gas tax Overnight Health Care: Takeaways on the Supreme Court's Obamacare decision | COVID-19 cost 5.5 million years of American life | Biden administration investing billions in antiviral pills for COVID-19 Democratic senators press PhRMA over COVID-19 lobbying efforts  MORE (Mass.) and Rep. Alexandria Ocasio-CortezAlexandria Ocasio-CortezHillary Clinton backs Shontel Brown in Ohio congressional race Ocasio-Cortez, Gillibrand and Moulton call for more high-speed rail funding in infrastructure package Pelosi picks Democrats for special panel tackling inequality MORE (N.Y.)

“I will not make that happen,” Biden said when asked about whether he would support $50,000 in student loan forgiveness.

He reiterated his previous support for up to $10,000 in debt relief per borrower, but expressed concerns that a higher total forgiven through executive action would disproportionately aid the well-off and potentially violate the law.

ADVERTISEMENT
“I do think in this moment of economic pain and strain that we should be eliminating interest on the debts that are accumulated, No. 1. And No. 2, I'm prepared to write off the $10,000 debt, but not [$50,000].”

Biden had previously expressed opposition to a $50,000 forgiveness plan and the White House has said repeatedly that the president would prefer to relieve student debt through an act of Congress. But Biden’s public, unequivocal refusal to go as far as progressives want stirred up the president’s first big fight with the left since taking office.

“An ocean of student loan debt is holding back 43 million borrowers and disproportionately weighing down Black and Brown Americans,” said Schumer and Warren in a joint statement Wednesday. The two reintroduced a resolution earlier this month calling on Biden to cancel up to $50,000 per borrower, a bill they first introduced in September.

“It’s time to act. We will keep fighting,” they said.

There are about 43 million Americans who owe a total of $1.6 trillion in student loans to the federal government. While progressives have argued for years that student debt forgiveness is essential to reducing inequality and bridging the racial wealth gap, moderates like Biden have come around to it as a way to blunt the damage of the coronavirus recession.

The battle over how far to go on student debt forgiveness has been simmering since Biden’s election in November and ramped up when Democrats took control of the Senate in January.

ADVERTISEMENT
The slim Democratic majority has given Biden a pathway to move his preferred plan — a bill, not executive order, to forgive up to $10,000 per borrower — through Congress.

But progressives had been raising pressure on Biden to aim higher and use executive action well before the Democratic takeover of the Senate.

Schumer, who is expected to face a primary challenge from the left in 2022, said in November that the incoming president had the power to unilaterally eliminate $50,000 in debt per borrower. Warren in December went even further, insisting Biden had a “moral obligation” to follow the plan she proposed with Schumer.

Biden is open to a debt relief executive order, but he suggested Tuesday that there may be legal limits on how much he could forgive. The president also said he was uncomfortable with wiping out debt held by graduates of prestigious universities and preferred revamping pre-existing forgiveness programs based on public service.

“The idea that I say to a community, I'm going to forgive billions of dollars is dead for people who have gone to Harvard and Yale and Penn … is that going to be forgiven rather than use that money to provide for early education for young children who are coming from disadvantaged circumstances?” Biden said. 

While Biden’s refusal to aim higher on debt relief disappointed progressives, his justification enraged them.

“Who cares what school someone went to? Entire generations of working-class kids were encouraged to go into more debt under the guise of elitism. This is wrong,” Ocasio-Cortez tweeted Wednesday. “Nowhere does it say we must trade-off early childhood education for student loan forgiveness. We can have both.”

Despite rising pressure from progressives, it could be months before Biden makes his move on student loan forgiveness.

Biden has extended the pause on federal student loan payments and interest accrual through September, which relieves some of the urgency to tackle debt.

White House press secretary Jen PsakiJen PsakiOvernight Defense: Pentagon pulling some air defense assets from Middle East | Dems introduce resolution apologizing to LGBT community for discrimination | White House denies pausing military aid package to Ukraine White House denies pausing military aid package to Ukraine Joe Rogan slams CNN's Stelter: 'Your show is f---ing terrible' MORE said Wednesday the previously announced legal review of his debt forgiveness authority wouldn’t happen until after Attorney General-designate Merrick GarlandMerrick GarlandHouse Judiciary asks DOJ to disclose remaining gag orders The Hill's Morning Report - After high-stakes Biden-Putin summit, what now? Biden frustrates death penalty opponents with Supreme Court request MORE has been confirmed by the Senate, raising the prospect of further delays on a debt wipeout.

“What the president has told Sens. Schumer and Warren is that once his team is in place at the Justice Department … he will ask them to conduct a legal review of his authority to act by executive action,” Psaki said.

“There’s a legal consideration there, as I think everybody agrees, and there’s a policy consideration, and once that's concluded he'll decide a path forward,” she added.

ADVERTISEMENT
Biden’s legal authority to relieve student debt is not settled law. While progressive legal analysts say the Higher Education Act gives Biden the ability to direct the Education Secretary to zero out student loan balances, conservative lawyers say debt forgiveness is beyond the bounds of the law.

Former Education Secretary Betsy DeVosBetsy DeVosErik Prince involved in push for experimental COVID-19 vaccine: report Biden administration reverses Trump-era policy that hampered probes of student loan companies DeVos ordered to testify in student loan forgiveness lawsuit MORE debated whether she had the authority to forgive student loan debt amid the onset of the coronavirus pandemic, but Trump administration lawyers determined it would be illegal. Their analysis, however, is not legally binding and Biden administration attorneys could reach a different conclusion.

Psaki also suggested Wednesday that Biden would limit debt relief based on a borrower’s income and educational attainment — a far cry from the bigger, unilateral wipe out supported by progressives.

“He said previously that relief above $10,000 should be targeted based on the borrower’s income, based on the kind of debt in question —public schools versus private schools, graduate schools versus undergraduate — obviously there’s a lot of considerations at play,” she said.

Even if Biden determines he has the power to forgive student debt through executive order, he’s still likely to face blowback from progressives based on the scope of his forgiveness plan.

“We’ve got the *Senate Majority Leader* on board to forgive $50k. Biden’s holding back, but many of the arguments against it just don’t hold water on close inspection,” Ocasio-Cortez tweeted.

“We can and should do it. Keep pushing!”