Biden says 22 million Americans have applied for student loan debt relief
Dover, Dale. — President Biden said Friday that 22 million Americans had applied for federal student loan relief since his administration opened the program this week, and accused Republicans of hypocrisy for trying to block the initiative.
In a speech at Delaware State University, a historically black school, Mr Biden tried to draw a sharp distinction with Republicans less than three weeks before the midterm election.
“Republican members of Congress and Republican governors are doing everything they can to deny this relief, even to their own constituents,” Mr Biden said, a day after courts took the measure. for two legal challenges that could cost the federal government hundreds of billions of dollars.
But later on Friday, the Court of Appeals for the Eighth Circuit temporarily halted Biden’s debt relief plan from going ahead until ruling on an emergency request by Republican-led states in a legal dispute.
The plan cancels $10,000 for those earning less than $125,000 per year, or $250,000 per family, and $20,000 for those receiving Pell Grants for low-income families. For millions, that level of relief will wipe out their federal student loan debt. The government plans to accept applications by December 31, 2023.
“In less than a week, nearly 22 million people have informed us to consider for this life-changing relief,” Mr Biden told a crowd at the university, where more than 75 percent of students receive Pell. are grants
The president compared the student loan relief plan to the $2 trillion tax cut Republicans passed in 2017 and the loan forgiveness that businesses received during the pandemic. He specifically called out some of his most staunch critics, such as Representative Marjorie Taylor Green, Republican of Georgia, and Senator Ted Cruz, Republican of Texas.
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Ms. Green and her husband received an $180,000 loan from the Paycheck Protection Program that was later forgiven, but called the student loan forgiveness “totally unfair”; Mr. Cruz referred to a fictional recipient of student loan relief as a “lazy barista” who wasted seven years in college studying completely useless things.
“Who in the hell do they think they are?” Mr Biden asked, drawing cheers.
The Department of Education has estimated that the program will cost $379 billion over its lifetime, which is over 30 years.
Mr Biden said the cost was affordable and noted his administration’s record of deficit reduction. Treasury Department data showed the federal budget deficit fell from $2.8 trillion a year ago to $1.4 trillion for the 2022 fiscal year, largely due to slashing pandemic emergency spending.
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The Biden administration began accepting applications for debt relief on Monday, and millions of borrowers submitted submissions as the new portal went live. The education department had said it would not cancel any loan at the earliest until Sunday, before the appeals court issued its stay.
The loan forgiveness program has faced lawsuits that claim the president has overstepped his authority. Mr Biden implemented the loan forgiveness program by enacting a 2003 federal law that allows the Secretary of Education to modify financial aid programs for students “in connection with a war or other military operation or national emergency”. The Biden administration has argued that the pandemic constitutes one such emergency.
Although lawsuits were expected, legal experts expressed doubts that those who tried to stop the program would stand to sue.
This week, a federal judge appointed by President George W. Bush dismissed a lawsuit brought by Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina. The judge said that the states have not demonstrated that they were hurt by the loan waiver.
Separately, Justice Amy Connie Barrett dismissed a challenge to policy brought by the Taxpayers’ Union in Wisconsin.
More legal challenges are emerging. The Biden administration was rushing to make sure the program was in place before its opponents found a judge who would freeze it, and it has already faced some backlash for backing down on its initial ambitions. Is.
In late September, the Department of Education indicated that some federal family education loans could no longer be consolidated into direct federal loans, which are eligible for forgiveness. The change would potentially prevent hundreds of thousands of borrowers who thought they were eligible for student loan forgiveness from having their loans approved.
This has stirred frustration from borrowers represented by debt relief groups such as Debt Collective.
Matt Lennartz, who graduated from Wright State University in Ohio in 2010, took out $27,000 in debt and now owes $42,000 because interest accrued when he was in a hardship.
“I am beyond desperation, with regards to finances in general, at this point,” said Lennartz, whose wife’s debts are eligible for relief. “It’s absolutely absurd.”
But it will be a lifeline for Delaware State University students hoping for relief.
Zachary Barnard, a student who introduced Mr Biden, said he took out a loan in 2019 to pay for his tuition and transportation. Now he will be able to graduate from debt free.
“It’s breaking down barriers in our communities and in our minds about what we can do with our futures,” Mr. Bernard said, adding that he and his friends are now looking to start businesses and save for their first homes. can think about.