Education Secretary Cardona meets with teachers and borrowers as he touts new student debt relief plan

Education Secretary Miguel Cardona met Monday with about half a dozen teachers and borrowers in New York City to mark the announcement of a newly proposed federal student debt relief plan that could benefit more than 30 million people.

This is the first direct attempt at bringing back a revised version of President Joe Biden’s student debt forgiveness program, which the Supreme Court struck down last year, crushing the hopes of more than 40 million eligible borrowers who could have had up to $20,000 in debt canceled.

"We want to provide as much debt relief to as many people as possible as quickly as possible," Cardona said in an interview Monday at the headquarters of the United Federation of Teachers union following his meeting with teachers.

"So, we're being very thoughtful about this," said Cardona, one of Biden's four Latino Cabinet members.

Cardona said his office and the Biden administration came together to work out the details of the newly proposed student debt relief plan taking into account the arguments from the Supreme Court justices who struck down their previous debt forgiveness program.

At the time, the court argued that Biden lacked power under the 2003 Higher Education Relief Opportunities for Students Act, HEROES Act in short, to enforce a program that would have cost more than $400 billion without congressional approval.

The new plan would cancel runaway interest for millions of borrowers, including that of more than 23 million low-income or middle-income borrowers. It would also nullify debt for those who are eligible but are not yet participating in current forgiveness programs, including those in public service who’ve been paying off their loans for 10 years or more, as well as for borrowers who started paying off their student loans two decades ago.

It would also help borrowers enrolled in low financial value programs and those who can detail financial hardship preventing them from repaying their loans — such as child care or medical expenses.

Cardona said he anticipates pushback from critics.

“They’re going to be some that are going to try to challenge us. Sadly, they’re more worried about saving face than helping their constituents. But we’re committed,” Cardona said. “We believe this is not a red or blue issue. This is a student issue. This is about saving higher education and making sure that the promise of opportunity exists for everyone.”

Student debt in the U.S. has been steadily increasing for more than a decade, reaching $1.74 trillion as of September. About 43 million Americans have some form of student loan debt.

Almost 7 in 10 (67%) Latino student borrowers have educational debt, according to the Education Data Initiative. Thirty-three percent of Latino borrowers said they put off marriage and 37% delayed having children because of their student debt.

Iolani Grullon, a kindergarten teacher in the predominantly Latino neighborhood of Washington Heights for 18 years, was one of several educators who met with Cardona. She obtained her undergraduate degree in 1995 and accumulated $30,000 in student loans, but piling interest caused her debt to double throughout the years.

After 15 years struggling to pay off her debt, Grullon was eligible to apply for the Public Service Loan Forgiveness program. She was denied repeatedly. But in January 2022, “when I finally saw my balance at zero,” Grullon learned she had been accepted.

The 50-year-old mother said the debt forgiveness has allowed her to start saving up to send her 16-year-old twin daughters to college in a few years.

Grullon said she has students whose parents are still attending college, adding that debt relief for them is a big deal, considering they have to also account for child care expenses as well as work and study.

Brenda Poggio, a former elementary school teacher of Ecuadorian descent now working with the United Federation of Teachers, obtained debt relief four months ago under the same program as Grullon after being denied multiple times.

“It was an amazing feeling,” Poggio told Cardona at the meeting, adding that it was the first time she felt retirement was within her reach.

First-generation college graduates, many of whom are Black and/or Latino, tend to have lower incomes and accumulate less wealth, on average, compared to those with a parent who has a bachelor’s or higher degree, complicating their ability to repay loans, according to a 2021 Pew Research Center analysis.

The Biden administration has already approved $146 billion in student debt relief for 4 million borrowers over the past three years under four existing debt cancellation programs: the Saving on a Valuable Education Plan’s early forgiveness, the Public Service Loan Forgiveness program, the total and permanent disability discharge plan, and the Income-Driven Repayment plan.

"That's more than any other administration, and we're just warming up," Cardona said.

"I hope people recognize that while the debt relief plan that we put forward, that at the Supreme Court struck down, was a setback, we're not done fighting," he said. "We're scrappy. We know who we're fighting for."

As Biden runs for re-election against presumptive Republican nominee Donald Trump, his administration has been intentional in touting their student debt cancellation efforts.

While Cardona declined to speak directly about Biden's re-election campaign, he said that their current plan and ongoing efforts to cancel student debt are what the Biden administration stands for.

But that hasn't always resonated with some prospective voters who have said they're still waiting for relief that hasn't happened.

The newly proposed student debt plan is expected to undergo a public comment period in coming weeks, according to the U.S. Department of Education.

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