Is Biden actually going to cancel your student loans? Here’s what policy insiders say

BY Sydney LakeFebruary 28, 2022, 10:42 PM
President Joe Biden speaks at an event to celebrate Black History Month in the East Room of the White House in February 2022.
President Joe Biden speaks at an event to celebrate Black History Month in the East Room of the White House in February 2022.
Brendan Smialowski—AFP/Getty Images

On the campaign trail, then presidential candidate Joe Biden said, “We should forgive a minimum of $10,000 per person of federal student loans.” More than one year into office, Biden hasn’t yet lived up to that pledge—but he has forgiven more than $15 billion in student loan debt. 

That’s not really taking a major crack at the student debt crisis, though, since 43 million–plus borrowers currently have federal student loans amounting to more than $1.61 trillion.

So far, student loan forgiveness has gone to targeted groups of borrowers including people with disabilities, those students who were defrauded by their higher education institutions, and certain borrowers who work in public service. Student loan payments have also been paused for all federal borrowers since March 2020 under the CARES Act, but those are set to start again come May. 

Is the breath of top Democrats, including Senate Majority Leader Chuck Schumer, Sen. Elizabeth Warren, and U.S. Rep. Alexandria Ocasio-Cortez, being wasted? In other words, will Biden ever really forgive student loans en masse as he said he intended to during the campaign?

“It is hard to say, because pressure has been building from Democrats as well as activists, both as the moratorium’s end once again draws near and inflation continues. That’s leaving aside what impact the war in Ukraine might have,” says Elizabeth Tandy Shermer, author of Indentured Students: How Government-Guaranteed Loans Left Generations Drowning in College Debt.

Biden has been quiet on the topic; in fact, he ignored a question about debt forgiveness posed by a reporter during a January 2022 press conference. But some student loan experts say mass forgiveness could still happen. 

“We are looking at 2022 as the year that broad-based debt cancellation is made a reality, and we urge President Biden to use his authority to sign an executive action to do so,” Cody Hounanian, executive director of the Student Debt Crisis Center, previously told Fortune. “After some resistance, the president extended the pause on federal student loans until May 1. This is a positive sign that the administration better understands the experience of borrowers and the obstacles they face.”

Biden’s authority to cancel debt

One of the looming questions about federal student loan debt cancellation is whether Biden actually has the authority to do so through an executive order. 

“I don’t think I have the authority to do it by signing [an executive order],” Biden said during a CNN town hall on Feb. 17, 2021. Speaker of the House Nancy Pelosi has also said she doesn’t believe Biden has the authority to cancel student debt by executive order. 

Other top Democrats like Schumer disagree, saying that Biden can do so with the “flick of a pen.”

Although Biden doesn’t believe he can cancel student loan debt through an executive order, other student debt experts note that it could be accomplished by an act of Congress. Congress is more likely “now than previously” to pass legislation that would implement mass student debt cancellation, Mark Kantrowitz, author of How to Appeal for More College Financial Aid, previously told Fortune

“With a conservative Supreme Court, the idea that he could cancel all of it or even a significant part of it with a flick of the pen is more of an aspirational statement rather than one that would likely hold up,” Travis Hornsby, founder of Student Loan Planner, argues. “Therefore we do not expect significant action on this.”

Shortly after Biden’s comments at the CNN town hall in 2021, White House Chief of Staff Ron Klain said Biden had directed the secretary of education to explore whether the executive branch has the legal authority to cancel student loan debt. At the time, the memo was promised to be made public within a few weeks. 

The full memo still hasn’t been released, but The New Yorker in October 2021 first reported that a heavily redacted version exists. This version doesn’t show much other than the fact that the White House had the memo for more than six months without releasing any information to the public. 

“With the current Supreme Court makeup, my summary thought is that I would put the chances of you, the borrower, getting actual cancellation beyond what happened already as very low,” Hornsby adds.

What Biden might do

Given what Biden’s administration has done thus far, it’s possible we could see more targeted rounds of student loan forgiveness in the future. 

“The Biden administration has a real track record now that we can look to and know how it thinks about awarding student loan relief,” Andrew Pentis, a certified student loan counselor with Student Loan Hero, previously told Fortune. “It’s been a track record of targeted relief to specific borrowers—not the mass forgiveness proposals that many progressives have called for.”

However, mass forgiveness “doesn’t seem likely without sustained pressure,” says Shermer.

“It really will come down to continued pressure from constituents, party members, and the many experts who have highlighted the immediate benefit cancellation would have; especially to the borrowers of color—women in particular—who struggle the most to repay debt, even without the recent pressure of inflation as well as the effects of economic sanctions on Russia,” she adds.

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