Biden facing pressure to extend student loan payment pause

Nov 15, 2022, 1:55 PM | Updated: Nov 16, 2022, 8:45 am
FILE - President Joe Biden speaks about student loan debt relief at Delaware State University, Oct....

FILE - President Joe Biden speaks about student loan debt relief at Delaware State University, Oct. 21, 2022, in Dover, Del. Biden is facing mounting pressure to extend a pause on student loan payments after his cancellation plan suffered a pair of legal blows. Advocates say Biden should continue the pandemic-era payment pause until legal issues are resolved. (AP Photo/Evan Vucci, File)

(AP Photo/Evan Vucci, File)

WASHINGTON (AP) — In the days and weeks before the midterm election, President Joe Biden trumpeted his plan to cancel billions in student loans as he rallied young people to support Democrats.

But now the entire initiative is in jeopardy because of legal challenges that could ensure no one receives a dollar of debt relief. The debacle is swiftly becoming a headache for the administration instead of an example of how the president keeps his promises to voters.

The White House insists it will ultimately prevail even though two federal courts blocked the program from taking effect. However, the setbacks have rattled supporters who fear that more than 40 million Americans who expected relief will instead start getting billed for their student debt in January, when a pandemic-era moratorium on payments is slated to expire.

“You cannot ask people to begin repaying on a debt that shouldn’t exist,” said Melissa Byrne, an advocate for loan cancellation. “We bear no blame in this broken system.”

The impasse has left the White House in a bind over whether to extend the moratorium if the legal battle drags on even though Biden has said the pandemic, the original reason for the pause in payments, “is over.”

The freeze has already cost the federal government more than $100 billion in lost revenue, according to the Government Accountability Office. Critics such as the Committee for a Responsible Federal Budget are warning that another extension could worsen inflation and raise the risk of economic recession.

Republicans oppose cancellation as an unfair handout for the wealthy, arguing Americans who didn’t go to college will bear the cost as well. Conservatives have orchestrated a barrage of legal attacks against Biden’s plan, saying it overstepped the president’s authority.

In the meantime, borrowers across the nation yet again face uncertainty. An estimated 20 million were eligible to get their federal student debt canceled entirely by Biden’s plan, which would cancel $10,000 in student loan debt for those making less than $125,000 or households making less than $250,000. Those who receive Pell Grants, typically given to those with lower incomes, would get another $10,000 in forgiveness.

Now, it’s unclear if borrowers will be expected to make payments on that debt when the pause ends, and the political hazards are growing. At risk is support from 43 million borrowers who have been promised at least some debt relief, including millions of younger Americans, a demographic that helped deliver key wins for Democrats last week.

Adwoa Asante, who is eligible for $20,000 in cancellation, said it would be “destabilizing” if her payments restart in January. The 33-year-old Dallas attorney owes $163,000 in law school debt, with monthly bills of up to $2,000. Asante voted for Biden but criticizes him for reaping the benefits of his plan in the midterms only to have borrowers left out in the cold.

“Honestly, there’s a lot of frustration toward the Biden administration. I think that they anticipated that there would be legal challenges to the student loan cancellation,” she said, calling the court challenges “to be expected.”

Cedric Richmond, who worked in the White House before becoming a senior adviser to the Democratic National Committee, doubted that Biden will face political fallout if the program is ultimately blocked.

If the program is ultimately blocked, he said, “the blowback should go exactly where it deserves, and that’s with this rogue Supreme Court.”

About 6 in 10 voters under 45 approve of Biden’s handling of student debt, according to AP VoteCast, a survey of more than 94,000 voters nationwide. Voters as a whole were almost evenly divided on the issue, while Democrats were far more likely to show approval than Republicans.

Nearly 26 million people already have applied for the debt relief, out of an estimated 43 million eligible. The Education Department stopped accepting new applications Friday after a federal judge in Texas struck the plan down.

Speaking in New Mexico on Nov. 3, Biden said he was on solid legal ground.

“We’re fighting them in court,” he said. We’re not letting them get away with it.”

Without the promised relief, advocates say many borrowers could quickly fall into default on their student loans. Nearly half of borrowers surveyed by the Student Debt Crisis Center say they will be unable to afford student debt payments within six months, according to a report released Tuesday.

“Borrowers do not feel that the pandemic is over, they do not feel that the economic impacts are over,” said Natalia Abrams, president of the center. “We need to pause payments until all legal hurdles are cleared.”

The legality of mass student debt forgiveness was in question from the start. After being elected, Biden said it would be best if the measure came from Congress. Soon before leaving office, the Trump administration released a memo concluding that the White House does not have authority for wide cancellation.

Supporters say they still have faith that Biden’s plan will survive, despite predictions that it could go before a Supreme Court that has shifted to the right and curbed Biden’s authority in other decisions. They argue that the Higher Education Act, a sprawling federal law, already gives the president wide power to cancel federal student debt.

Some groups say Biden should pursue other legal avenues to deliver his promise. The Debt Collective, a union of borrowers, is urging Biden to cancel debt immediately by invoking the Higher Education Act, the same legal authority initially suggested by supporters including Sen. Elizabeth Warren, D-Mass.

“He has an ace up his sleeve and he hasn’t used it,” said Braxton Brewington, a spokesperson for the collective. “The Biden administration should simply sidestep these lawsuits.”

Some legal scholars say Biden should scrap the current plan and start over. Jed Shugerman, a law professor at Fordham University in New York, said he believes the White House made a mistake in its legal reasoning.

“The Biden administration has run into trouble that was clearly foreseeable,” he said. “They should go back to square one.”

Even though that would take time, Shugerman said, it’s better than waiting for a loss from the Supreme Court. The White House, he said, is “sticking to a sure loser” instead of “changing tracks to something that has a better chance.”

___

Associated Press writers Hannah Fingerhut and Claire Savage contributed to this report.

___

The Associated Press education team receives support from the Carnegie Corporation of New York. The AP is solely responsible for all content.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

FILE - Web designer Lorie Smith is shown in her office on Nov. 7, 2022, in the southwest part of Li...
Associated Press

Both sides see high stakes in gay rights Supreme Court case

WASHINGTON (AP) — The Supreme Court is being warned about the potentially dire consequences of a case next week involving a Christian graphic artist who objects to designing wedding websites for same-sex couples. Rule for the designer and the justices will expose not only same-sex couples but also Black people, immigrants, Jews, Muslims and others […]
23 hours ago
Associated Press

Today in History: December 3, gas disaster in Bhopal

Today in History Today is Saturday, Dec. 3, the 337th day of 2022. There are 28 days left in the year. Today’s Highlight in History: On Dec. 3, 1984, thousands of people died after a cloud of methyl isocyanate gas escaped from a pesticide plant operated by a Union Carbide subsidiary in Bhopal, India. On […]
23 hours ago
FILE - John Duarte, a Republican candidate in California's 13th Congressional District, arrives at ...
Associated Press

GOP’s Duarte takes California Central Valley US House seat

LOS ANGELES (AP) — Republican John Duarte defeated Democrat Adam Gray on Friday in a new California U.S. House district in the Central Valley farm belt that produced the closest congressional contest in the state this year. With virtually all of the ballots counted, Duarte has just over 50% of the vote. Gray conceded in […]
23 hours ago
Associated Press

Family seeks answers after police kill man on his own porch

AUSTIN, Texas (AP) — The family of an Austin, Texas, man is seeking answers after he was fatally shot by police last month on his front porch following a late-night emergency call by a neighbor. Video and audio released Thursday show Austin police officers arrived Nov. 15, yelled “drop your gun,” then fired at Rajan […]
23 hours ago
FILE - Flowers and candles are placed around crosses on May 28, 2022, at a memorial outside Robb El...
Associated Press

Uvalde shooting victims seek $27B, class action in lawsuit

AUSTIN, Texas (AP) — Victims of the Uvalde school shooting that left 21 people dead have filed a lawsuit against local and state police, the city and other school and law enforcement officials seeking $27 billion due to delays in confronting the attacker, court documents show. The lawsuit, which was filed in federal court in […]
23 hours ago
The Democratic National Committee Rules and Bylaws Committee discuss proposed changes to the primar...
Associated Press

Dems move to make South Carolina, not Iowa, 1st voting state

WASHINGTON (AP) — Democrats voted Friday to remove Iowa as the leadoff state on the presidential nominating calendar and replace it with South Carolina starting in 2024, a dramatic shakeup championed by President Joe Biden to better reflect the party’s deeply diverse electorate. The Democratic National Committee’s rule-making arm made the move to strip Iowa […]
23 hours ago

Sponsored Articles

...
Day & Night Air Conditioning, Heating and Plumbing

Prep the plumbing in your home just in time for the holidays

With the holidays approaching, it's important to know when your home is in need of heating and plumbing updates before more guests start to come around.
...
Quantum Fiber

How high-speed fiber internet can improve everyday life

Quantum Fiber supplies unlimited data with speeds up to 940 mbps, enough to share 4K videos with coworkers 20 times faster than a cable.
...
Day & Night Air Conditioning, Heating and Plumbing

Ways to prevent clogged drains and what to do if you’re too late

While there are a variety of ways to prevent clogged drains, it's equally as important to know what to do when you're already too late.
Biden facing pressure to extend student loan payment pause