President-elect Joe Biden is considering executive action to forgive $50,000 in student loan debt for students from middle- and low-income families, Senate Minority Leader Chuck Schumer said Monday.
"We have come to the conclusion that President Biden can undo this debt, can forgive $50,000 of debt the first day he becomes president."
—Sen. Chuck Schumer
Schumer (D-N.Y.) has been pushing Biden to sign an executive order on his first day in office that would provide relief to many of the more than 44 million people in the U.S. who collectively owe over $1.6 trillion in student loan debt.
"We have come to the conclusion that President Biden can undo this debt, can forgive $50,000 of debt the first day he becomes president," Schumer said at a joint press conference outside his Manhattan office with Democratic Congressmen-elect Ritchie Torres, Mondaire Jones, and Jamaal Bowman of New York.
"You don't need Congress, all you need is the flick of a pen and President-elect Biden—then President Biden—can make this happen," Schumer said.
JUST IN: Sen. Chuck Schumer: President-elect Joe Biden is "considering" forgiving $50,000 in federal student loan debt for all borrowers. pic.twitter.com/KS4WNgAb79
— The Hill (@thehill) December 7, 2020
"It's flat-out wrong that people in this country hold more than $1.6 trillion in student debt," said Bowman. "But the Biden administration has the power to do something about that, and can act even if Republicans in the Senate choose to ignore the problem. Forgiving $50,000 in student debt will change young people's lives, particularly for Black young people, who hold far more student loan debt than their white peers."
"It's the right thing to do, and I urge the Biden administration to act," he added.
Schumer said that he and Biden have discussed "how important" such relief is, and that the president-elect is "considering" taking action.
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During the 2020 Democratic primary, Sen. Bernie Sanders (I-Vt.) proposed the most ambitious student loan relief action of all the candidates, vowing to wipe out all outstanding debt and pay for it with a 0.5% tax on stock transactions and a 0.1% tax on bonds.
The other progressive frontrunner in the race, Sen. Elizabeth Warren (D-Mass.), said she favored similar debt relief to what Schumer is now proposing. Under her plan, the Department of Education would "modify" federal student loans up to $50,000 for 95% of debtors.
Student loan debt hurts struggling families, but @FederalReserve Chair Powell confirmed to me today that it also hurts our economy. Executive action to #CancelStudentDebt is the single most effective economic stimulus available to President-elect Biden on day one. pic.twitter.com/OUtFucndK0
— Elizabeth Warren (@SenWarren) December 1, 2020
If we can cancel trillions in taxes for a handful of billionaires we can cancel student loan debt for 45 million students.
— Robert Reich (@RBReich) November 30, 2020
Last week, Schumer and Warren published a joint op-ed asserting that the American people understand the urgent need for student debt relief. The senators wrote:
They see their friends, family, and neighbors crushed by growing debt burdens, unable to afford their first home or start a small business. They know a senior whose Social Security check has been garnished by the federal government just to pay student loan interest. They know a mother struggling to make ends meet who never got a degree and now watches her debt load grow faster than she can keep up with...
Broad cancellation of student debt would give tens of millions of Americans $200 to $300 more to spend and save each month. Cancellation also means they won't have to worry about a student debt time bomb exploding when the payments suspension ends. With more money in their pockets and a smaller debt load, they can consider bigger purchases like cars and homes and, for some, start their own businesses. That's good for the borrower and good for our economy.
"With the stroke of a pen on day one, the Biden-Harris administration can right this wrong," the senators wrote. "They can close the Black-white wealth gap by 25 percentage points, and close the Latinx-white wealth gap by 27 percentage points, giving Black and brown families across the country a far better shot at building financial security."