The additional statements of support for $50,000 in federal student loan forgiveness came after the White House seemed to withdraw support for the initiative.
After conflicting statements from the White House about whether President Joe Biden will issue an executive order to forgive up to $50,000 in federal student loan debt, multiple congressional leaders, trade associations, and consumer advocacy groups are urging the Biden administration to act quickly to close the racial gap and stimulate the economy.
Echoing calls by other leading Democrats earlier this month (see Banking and Finance Law Daily, Feb. 5, 2021), Senate Majority Leader Chuck Schumer (D-NY) and Sen. Elizabeth Warren (D-Mass) noted that Presidents Obama and Trump both utilized their executive authority to cancel student loan debt. Therefore, they are urging President Biden to follow suit and exercise his "broad authority to immediately deliver much-needed relief to millions of Americans."
Similarly, Congressional Progressive Caucus Chair Pramila Jayapal (D-Wash) said, "45 million Americans are stuck in the student debt trap—saddled with more than $1.6 trillion in debt that prevents them from pursuing their dreams, starting families, and investing in our communities. People of color are disproportionately burdened by student loan debt, creating a vicious cycle for Black and Brown borrowers and widening the racial wealth gap."
Americans for Financial Reform (AFR) Senior Policy Analyst Alexis Goldstein highlighted Biden’s Racial Economic Equity campaign plan which called for an "immediate cancellation of a minimum of $10,000 in federal student loan debt." Amidst the coronavirus pandemic, Biden is uniquely situated to bring immediate relief to student loan borrowers and their families, said Goldstein. She also emphasized that AFR is part of a "growing" coalition of more than 325 organizations calling for the student loan forgiveness.
The Center for Responsible Lending (CRL) observed that even before the pandemic, student loan borrowers were struggling under the weight of more than $1.6 trillion in debt, particularly Black and Latino borrowers. But as borrowers have been impacted by COVID-19 due to income loss and devasted savings, many are bracing for financial disaster. The CRL statement concludes by stating that if Biden is serious "about helping communities of color and spurring economic recovery, student loan debt must be part of the solution. The student loan system has been broken for too long; it is time to clear the books and provide borrowers with a path forward." The agency’s Road to Relief, originally published in November of 2020, describes the roadmap the President, Secretary of Education, and Congress can use to improve the federal student loan program and ensure that 44 million borrowers have one less burden to manage as this crisis continues.
Companies: Americans for Financial Reform; Center for Responsible Lending
MainStory: TopStory CommunityDevelopment ConsumerCredit Covid19 Loans
Interested in submitting an article?
Submit your information to us today!Learn More
Banking and Finance Law Daily: Breaking legal news at your fingertips
Sign up today for your free trial to this daily reporting service created by attorneys, for attorneys. Stay up to date on banking and finance legal matters with same-day coverage of breaking news, court decisions, legislation, and regulatory activity with easy access through email or mobile app.