President Biden’s administration concludes with a controversial $183 billion student loan forgiveness plan, sparking debate over its economic impact and legality.
At a Glance
- Biden cancels student debt for 150,000 borrowers in his final hours as president
- Total student loan forgiveness under Biden reaches $183.6 billion
- Critics argue Biden used a loophole to bypass Supreme Court ruling
- Republicans plan to reverse Biden’s changes
- Over 5 million Americans have had their student debt canceled under Biden
Biden’s Final Act: Massive Student Loan Forgiveness
In a move that has intensified the ongoing debate over student loan forgiveness, President Joe Biden’s administration announced the cancellation of student debt for an additional 150,000 borrowers just before leaving the White House. This latest action brings the total amount of student loan debt canceled under Biden to a staggering $183.6 billion, affecting over 5 million Americans.
The Biden administration’s approach to student loan forgiveness has been both praised and criticized. Supporters view it as a necessary step to address the growing student debt crisis, while opponents argue it’s an overreach of executive power and economically unsound.
Biden administration provides student loan relief to 150,000 borrowers in final days https://t.co/D4Yc1bD5vl
— POLITICO (@politico) January 13, 2025
Bypassing the Supreme Court
After the Supreme Court rejected Biden’s broader student debt relief plan, the administration pivoted to using existing programs to continue their forgiveness efforts. The Education Department expanded and simplified rules for programs such as borrower defense, Public Service Loan Forgiveness (PSLF), and relief for borrowers with disabilities. “My Administration has taken historic action to reduce the burden of student debt, hold bad actors accountable, and fight on behalf of students across the country” Biden stated.
Critics, including many Republicans, argue that Biden is using a loophole to circumvent the court’s ruling. They contend that this approach undermines the legal system and sets a dangerous precedent for executive overreach.
Impact and Future Uncertainty
The impact of Biden’s student loan forgiveness efforts has been significant. Before his presidency, only 7,000 borrowers had their loans canceled through the Public Service Loan Forgiveness program. Now, over 1 million public servants have benefited from the expanded program.
However, the future of these forgiveness programs remains uncertain. Republican states and members of Congress have strongly opposed Biden’s efforts, with some vowing to roll back these changes. The Heritage Foundation’s Project 2025, suggests ending PSLF and narrowing the borrower defense program.
Economic Concerns and Political Divide
The massive scale of loan forgiveness has raised concerns about its economic impact. Critics argue that it could contribute to inflation and unfairly burden taxpayers who didn’t attend college or have already paid off their loans. Supporters counter that relieving student debt will stimulate the economy by freeing up spending power for millions of Americans.
