Democrats Call for Student Debt Relief

Democrats Call for Student Debt Relief

( – In late March, Congress passed a $2.2 trillion coronavirus relief bill. As part of the law, student loan payments were suspended until September 30. The relief was ultimately extended until December 31. Now that the election is over and Joe Biden has declared himself the winner, Democrats are openly discussing how to reduce or eliminate existing student loans.

On Tuesday, November 17, Biden said there should be “immediate” action by Congress on student loan relief. However, some Democrats may not be certain that’s possible and are calling on Biden, once in office, to use the power of his pen.

Schumer and Warren Call for Executive Action

In a resolution filed by Sen. Elizabeth Warren (D-MA), she claims that America is facing a historic student loan crisis while the COVID-19 pandemic threatens the financial viability of almost every American. The resolution says that 43 million Americans carry more than $1.5 trillion in federal student loan debt. It adds that 9 million federal student loan borrowers are in default.

Resolutions are position agreements by those who sign them and are not laws.

Last week, Warren suggested that a President Biden could immediately forgive up to $50,000 in student debt to every person who has a federal student loan. On Tuesday, November 17, Senate Minority Leader Chuck Schumer (D-NY) echoed Warren’s call to do so with a pen instead of legislation.

However, while Biden has called for action, his proposal isn’t going that far. He’s calling for Congress to pass legislation to forgive $10,000.

Democrats and Republicans Disagree

Democrats claim that eliminating school loan debt will stimulate the economy as people have more money to spend on housing and entertainment. In June, Sen. Bernie Sanders (I-VT) said businesses received help, and so should individuals.

“During the financial crisis, Wall Street received the largest taxpayer bailout in American history. Now it is Wall Street’s turn to help rebuild the disappearing middle class.”

Democrats say that the issue is about both economic and racial justice. In March, far-left squad members introduced a Student Debt Emergency Relief Act that called for a $30,000 elimination so people didn’t have to choose between paying their school loans or feeding themselves during the pandemic.

Recently, Rep. Rashida Tlaib (D-MI) said student debt elimination is a “racial justice issue” and claimed — without evidence — that minorities carry higher school loan debt and are leaving school because they can’t afford the bill. Rep. Ayanna Pressley (D-MA) said student debt elimination would not only kick-start the economy, but it would also close the racial wealth gap. She then called to cancel rents and mortgages as well. She was echoed by Rep. Alexandria Ocasio-Cortez (D-NY).

Whatever good intentions the far-left may think it has, Republicans counter that it could hurt Americans who never had college debt or paid it off in full. Rep. Dan Crenshaw (R-TX) expressed a widely-held sentiment that suggests wiping out the debt is “immoral” because the taxpayer will assume the debts and pay for them unfairly.

Can a President Eliminate School Debt?

It’s highly questionable if a president has the legal authority to wipe out school loan debt. It’s the likely reason Biden called Congress to action. Without a specific law that allows the government to assume debt, it will be challenged in court and could be overruled. Consider this: the US government can’t take on more debt without congressional action every year to keep the government running.

Why would this be any different?

In the days and months ahead, many contentious issues may arise if Biden takes office and far-left Democrats try to push him further left as promised.

Stay tuned!

Don Purdum, Independent Political Analyst

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