Throughout President Joe Biden’s first ten months in office, the U.S. Department of Education has issued five rounds of student loan forgiveness totaling $11.24 billion. That debt cancelation affects everyone from disabled Americans to defrauded students of nefarious schools like ITT Tech to public servants.
It would be understandable if onlookers assume these debt cancellation moves mean the Biden administration is quickly chipping away at total student loan debt. Except, well, that’s not even close to what’s actually happening.
The $11.24 billion in student loans that the U.S. Department of Education will cancel amounts to less than 1% of the total $1.75 trillion U.S. student loan debt. In fact, in the most recent quarter, total student loan debt rose another $22 billion, meaning that Biden’s student loan cancellations aren’t even large enough to prevent total student loan debt from continuing to climb upwards.
Who is eligible for these 2021 rounds of targeted student loan forgiveness? Back in October, the Department of Education announced it will expand the Public Service Loan Forgiveness (PSLF) program to cover more affected borrowers (to see who that covers, go here). Prior to that round, the agency put into motion a plan to automatically cancel $5.8 billion in student loans held by more than 323,000 borrowers who have a total and permanent disability (TPD). The remaining three rounds have combined to wipe out the debt of nearly 200,000 defrauded students (to find details on those rounds, go here).
Will more rounds of student loan forgiveness come?
It’s unlikely the Democratic controlled Congress will pass anything anytime soon. Getting moderates like Sen. Joe Manchin—who already shot down free community college—onboard would be no easy task. Some progressive lawmakers, like Alexandria Ocasio-Cortez, are pushing Biden to simply cancel more debt through executive action, however, the White House hasn’t expressed openness to that option.
That leaves broader cancellation in the hands of just the Department of Education. Some industry insiders interviewed by Fortune say the agency broadening existing forgiveness options (like Public Service Loan Forgiveness) to more borrowers in 2022 is the most likely path for more forgiveness. But, of course, that’s hardly the mass forgiveness that activists are seeking.
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