United States President Joe Biden on Wednesday announced a partial forgiveness of student loans, an issue that is generating heated debate in a country where a year of college can cost tens of thousands of dollars. “As per my campaign promise, my administration is announcing a plan to give working and middle class families a break as they prepare to resume federal student loan repayments in January 2023,” he tweeted. Joe Biden, promising details in the afternoon.
In keeping with my campaign promise, my Administration is announcing a plan to give working and middle class families breathing room as they prepare to resume federal student loan payments in January 2023.
I’ll have more details this afternoon. pic.twitter.com/kuZNqoMe4I
— President Biden (@POTUS) August 24, 2022
The measure, announced less than three months before the midterm elections, affects people earning less than $125,000 a year, according to an illustration accompanying the president’s tweet. It will be a question of erasing 10,000 dollars for people who have not benefited from a federal scholarship to pay the costs related to their university studies, and 20,000 dollars for those, with more modest means, who have received one. The plan was announced after months of reflection at the White House on this issue, which has also been a headache for previous administrations. The executive was particularly concerned about the possibility that the measure would fuel already galloping inflation.
An average debt of $25,000
Democratic Senators Chuck Schumer and Elizabeth Warren hailed in a joint statement “a giant step towards resolving the student debt crisis”.
With the flick of a pen, President Biden has taken a giant step forward in addressing the student debt crisis by canceling significant amounts of student debt for millions of borrowers.
My statement with @SenWarren: pic.twitter.com/LuZo8EowyD
— Chuck Schumer (@SenSchumer) August 24, 2022
The leader of the Republican Party, Ronna McDaniel, on the contrary judged that this measure “unfairly punishes Americans who have saved up for university or made a different career choice”. American universities can charge anywhere from $10,000 to $70,000 a year, and many students begin their working lives with heavy debt.
According to government estimates, the average US student debt when they graduate is $25,000, a sum that many take years or even decades to pay off. In total, some 45 million borrowers in the country collectively owe $1.6 trillion, according to the White House. Joe Biden also announced that a moratorium on student loan repayments, introduced during the Covid-19 pandemic, would be extended until the end of the year.