Student loan forgiveness is 'good policy' and 'also good politics,' Rep. Pressley says
President Joe Biden has said he's considering canceling some student loan debt for millions of Americans, and one lawmaker who played a key role in pushing him to consider debt forgiveness says that the move would make sense for several reasons.
"Democrats win when we deliver, and we have to deliver in ways that are impactful, tangible, and transformative, like canceling student debt," Congresswoman Ayanna Pressley (D-MA) said in a Yahoo Finance Presents interview (video above). "This is good policy, and it is also good politics."
Payments on federal student loans are currently paused through August 31, 2022. The pause was set to expire on May 1 after being enacted by former President Donald Trump amid the coronavirus pandemic in March 2020 and extended multiple times by Biden.
Last week, President Biden said he was considering "some debt reduction" and would make a decision in "the next couple of weeks." Biden is reportedly weighing income caps on who receives loan forgiveness.
'Next couple of weeks'
The president's change of heart on the issue is noteworthy.
Biden backed the forgiveness of $10,000 in student loan debt on the campaign trail in 2020. During his administration, prominent Democrats — including Pressley — have repeatedly urged a seemingly skeptical Biden to enact broad-based cancellation of up to $50,000 via executive action (as opposed to legislation passed by Congress).
On Thursday, he changed his tune.
"I am considering dealing with some debt reduction," Biden said during a press conference. "I am not considering $50,000 debt reduction. But I’m in the process of taking a hard look at whether or not there are going to — there will be additional debt forgiveness, and I’ll have an answer on that in the next couple of weeks."
The change of heart was welcome news for Pressley, as well as many advocates and student debtors who have been pushing for debt cancellation for years.
"I thank the President for heeding the cause of this broader movement and coalition, both to express an openness to canceling student debt at some level, and ... [for] the several pauses that we have been able to get during this pandemic," Pressley said.
'This is about the president keeping his word'
Student loans were a big topic during the 2020 general election. A recent poll by Harvard found young Americans overwhelmingly favor some form of action by the federal government on student loans while only 38% favored total debt cancellation.
"At the end of the day, we want to uplift and alleviate the burden for as many people as possible," Pressley said. "And that is why we need broad based student debt cancellation. He has the authority, and I think he has a mandate from this electorate."
The basic argument for broad cancellation, as detailed by the Legal Services Center of Harvard Law School, is that the Education Secretary has the power “to cancel existing student loan debt under a distinct statutory authority — the authority to modify existing loans found in 20 U.S.C. § 1082(a)(4).” (Toby Merrill, who founded the Project on Predatory Student Lending at Harvard Law School and co-authored the legal analysis, currently works for the Education Department.)
Pressley also stressed that student debt is also a multi-generational issue since many borrowers include parents who took out Parent PLUS loans for their children.
"This is about being responsive to the multi-generational, multiracial coalition, which decisively elected him," she stressed. "This is about the president keeping his word."
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Aarthi is a reporter for Yahoo Finance. She can be reached at aarthi@yahoofinance.com. Follow her on Twitter @aarthiswami.
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