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In the USA, millions of former students are likely to become debt-free in one fell swoop. President Joe Biden is forgiving some of their student loans. In doing so, he is making good on a campaign promise.
In the United States, President Joe Biden is waiving up to $20,000 in government student loans for several million students that do not have to be repaid. He is also extending until the end of the year the exemption from suspending repayments without penalty interest. Even if opinions on student debt relief are divided, Biden said at a media conference that he was convinced that his plan was “responsible and fair”.
Graduates who earn less than $125,000 a year should not have to pay back $10,000 of their state loans. Anyone who has taken out a special loan from a support program for the underprivileged can even cut $20,000.
Studying in the USA is extremely expensive
According to the government, around 43 million Americans can benefit from this decision, and around half of them can even become completely debt-free. Biden emphasized that America is “the land of opportunity” and that’s what it’s all about.
America is the land of opportunity.
With the debt relief, Biden is making good on a campaign promise, but the basic problem remains: studying – not at an elite university, but also at a public college – has become enormously expensive in recent decades. Those who do not have rich parents or receive a scholarship are forced to take out a loan and pay it off over a period of years. According to the Department of Education, students owe around $25,000 on average after earning a bachelor’s degree.
Collect points with young voters
Biden has also once again extended the deadline to suspend repayments without interest on debt. This moratorium has been in effect since the Corona pandemic. It is no coincidence that the deadline was extended to the end of the year, i.e. until after the midterm elections in November. The Democrats are trying to retain a majority in both chambers of Parliament. In order to do this, they have to score points with younger voters in particular.