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Candidate Joe Biden made a campaign promise to forgive $10,000 worth of student debt per borrower once he made it to the White House. But now that he’s president, wide-ranging student debt relief doesn’t seem to be on the agenda.
Biden’s reluctance to prioritize student debt relief is heightening tensions with the progressive wing of his party, which is pushing him to take a more aggressive stance. And it’s raising questions about whether debt forgiveness — a hot-button issue on the left—is really going to happen at all.
It’s an urgent question for millions of borrowers, who have collectively racked up $1.7 trillion in student debt—a larger number than the nominal annual economies of Australia or Brazil. Stacked up in one dollar bills, $1.7 trillion would reach about halfway to the moon.
Thanks to the magic of compound interest, the number just keeps getting larger, and many borrowers end up having to repay significantly more than they received in the first place.
Yet Biden has resisted calls from progressive lawmakers to raise his $10,000 pledge to $50,000. And he pointedly didn’t include a debt forgiveness proposal in his recent annual budget.
Even if Biden decides to aggressively pursue student debt relief, he faces tactical challenges in getting it done. In essence, he’s got two options: pursue a solution with Congress, or go it alone. But both have problems.
In Congress, his problem, as usual, is the Senate. Biden would need 10 Republicans to back him up in the evenly divided chamber, or else convince all 50 Democrats to support using a hardball parliamentary maneuver—like blowing up the filibuster—that would let them elbow naysaying Republicans out of the way.
Right now, neither looks likely.
So that leaves Option 2: Forget Congress and simply issue an executive order telling the Department of Education to just start shredding that debt.
This idea has some big boosters on the left, including Sen. Elizabeth Warren of Massachusetts, who has argued that Biden doesn’t need Congressional approval.
Yet the legal details are complex, and Biden has said he doesn’t think it’s so simple. In February, he said, “I don’t think I have the authority to do it by signing the pen.”
Now, Biden has asked his Department of Justice and Department of Education to study the law, and give him their final legal opinion.
Millions of borrowers and their families will be watching carefully for their conclusion—and Biden's next move.