President Joe Biden, campaign promise of cancelling student loan debt was activated in August 2022. The President offered to cancel $10k to all Federal Student Loan Borrowers making less than 125k per year, (250k for married couples). Some publications lists 20k which would include Pell Grants, however that is misleading. Pell Grants do not require repayments.
Also misleading is the ideas that borrowers would receive a 10k check in the mail or that tax payers would have an additional burden to bear. Those are erroneous thoughts. The reality is the 10k amount is discounted from the full amount owed. Rather than paying back 65k, a borrower would pay back 55k. That is no additional burden to the tax payer. Often times misleading ideas are introduced and supported by media activist peddling a political position.
There is an argument that people who dropped out or never attended school do not receive a discount so why should students get a break. Particularly those who are in the higher income brackets. The counter to that charge is that those in higher income brackets don’t qualify for certain loans and government support in which only low income qualify for.
Among the political divide you will find legal challenges to the administration’s debt cancellation policy. Most recently the Wisconsin Institute for law and liberty (WILL), alleges that Biden doesn’t have unilateral power to forgive student loans without congressional approval and that the forgiveness program was created with racial motivations in violation of the ‘equal protection doctrine,’ which requires the government to treat an individual in the same manner as others in similar circumstances,” it reports.
While the Biden administration has approved its plan to forgive 10k in student loans. Its questionable whether this plan’s design will make it to the finish line. It may be modified to the point of losing its purpose due to legal challenges and responses.
