On August 24th of this year, President Joe Biden announced that his administration would be forgiving up to $10,000 of student loan debt for each person. This decision has sparked controversy. Liberals generally view the decision as a necessary move to help students get on their feet and avoid financial burden after graduation. Conservatives view the decision as an unconstitutional attempt to “buy votes” from Democrats. Even though this measure has been blocked by a federal district court in Texas, it still sparks wide and heated debate across the country.
Progressives, especially younger ones, were excited about this loan forgiveness decision by the Biden Administration. It aims to help people in the low and middle income bracket who are burdened with extreme student debt that can be very hard to pay off immediately after graduating college.
An argument in favor of forgiveness is that these student loans are predatory: eighteen-year-old college students should not be encouraged to make a financial decision that could cause them unforeseen difficulty post-graduation.
For a graduate of a relatively cheap community college or state school, this debt relief could cover the entirety of the loans that they took out as students. Once the burden is removed, graduates will be able to start saving up more money or maybe spend more money, thus boosting the economy.
During a press conference, President Biden even touted how easy it was to apply for loan forgiveness. He was right. It is a simple process that should be no longer than 5 minutes. One need only supply some basic information and then submit.
U.S. President Joe Biden, joined by Education Secretary Miguel Cardona, speaks on student loan debt in the Roosevelt Room of the White House August 24, 2022 in Washington, DC. (Alex Wong/ Getty Images)[/caption]
President Biden also justified this plan by bringing up the financial challenges so many Americans faced while dealing with the Covid-19 pandemic. He also addressed the claim that this is simply a bailout for rich students who do not really need loan forgiveness. He stated that “nearly 90 percent of the relief is going to go to people making under $75,000 a year.” He continued by clarifying that “not a dime will go to the top 5 percent of incomes.” Biden’s limit on income for those receiving loan forgiveness, as well as the additional money that Pell Grant recipients are eligible for, demonstrates his administration’s commitment to focusing on those who truly need assistance.
But conservatives are not big fans of Biden’s loan forgiveness program. The most frequently made complaint concerns the sheer cost of implementing it. Estimates had this plan costing the American taxpayer $30 billion annually with a grand total of upwards of $350 billion. With the United States already in massive debt, as well as all the spending during the pandemic, this plan was viewed by many as financially irresponsible.
Another criticism comes from those who did not have student loans or had paid them off already. Many people choose not to go to college or work their way through college to avoid student debt after graduation. Using these peoples’ tax dollars to pay off the debts of others seems unfair. People who worked hard to avoid debt should not have to pay off the debts of complete strangers, they argue.
Another key criticism is that current college students would take out unnecessary loans if they knew that $10,000 would be forgiven. Conservative writer Brad Polumbo claimed in a tweet that “a significant number of college students admit to using their student loan money to buy alcohol/drugs and/or pay spring break expenses.” The implication here is that many students are financially irresponsible with their loan money and use it to have a good time rather than to pay for tuition, housing, and books. The initial application for debt relief does not require students to prove that they used their student loan money for school. All that is required is that the student is under the income limit.
These are all valid arguments against the debt relief program. The most important argument, however, is that President Biden simply does not have the Constitutional authority to enact this plan.
President Biden sits in the oval office and signs a series of orders. Executive orders live the ones being signed above became characteristic of Biden’s administration and faced much conservative pushback. (Photo by Jim WATSON / AFP) (Photo by JIM WATSON/AFP via Getty Images)AFP VIA GETTY IMAGES
Earlier in his term, President Biden encouraged Congress to pass loan forgiveness legislation. Congress did not end up acting on this, mainly because the Democrat majority in both Houses of Congress is razor thin. President Biden then decided to issue an executive order to enact loan forgiveness. This infuriated many people because it was yet another incident of a President (both parties are guilty of this) using an executive order to circumvent the law-making powers of Congress. Six Republican led states (Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina) filed a lawsuit against the Biden administration on these grounds.
As of November 14th, of this year, the 8th Circuit Court of Appeals continued the existing pause on President Biden’s loan forgiveness plan. The Republican states that filed this suit intentionally filed it in an area covered by the 8th circuit, because it is one of the most conservative appeals courts. Judge Mark Pittman, the Trump appointed Judge out in Texas who initially ruled against the loan forgiveness plan based his decision on the claim that the plan violated congressional power. The Biden Administration intends to keep fighting for this plan in court. If the courts eventually decide in favor of the Biden Administration, most students will be eligible to receive $10,000 worth of loan forgiveness. The link to the application is here.
https://studentaid.gov/debt-relief/application (As a result of the recent Court decision, no applications are being accepted at the moment)