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Can Biden cancel college debts with student loan forgiveness?

The President has previously said he supports providing financial relief for graduates, but his new budget looks likely to exclude proposals to write off a proportion of students' debt.

The President has previously said he supports providing financial relief for graduates, but his new budget looks likely to exclude proposals to write off a proportion of students' debt.

In the early days of the pandemic former President Donald Trump used executive authority to pause federal student loan payments, giving respite to those struggling with the economic fallout of covid-19.

Upon entering office on 20 January, President Joe Biden did the same and extended the freeze up to 1 October. However while Biden issued support for more long-lasting student debt relief on the campaign trail he has done little to address the issue since becoming president.

He is under increasing pressure to provide financial relief for struggling graduates who have built up huge debts during their studies, but there is uncertainty about how much help he can offer using executive authority.

Biden faces calls for student loan forgiveness

Despite having offered his support for the idea during campaigning, Biden is yet to offer up a specific proposal on what student loan forgiven his administration could provide. His administration have laid the groundwork for progress but it is still unclear whether Biden would choose to implement loan forgiven through executive actions or by asking Congress to pass legislation.

In late-April the American Families Plan was first unveiled with a number of inclusions that relate to the issue of student debts. His administration intend to increase the size and availability of Pell Grants and provide greater funding for free community college, so students can opt not to go to fee-paying institutions.

However despite these measures, some have criticised Biden for failing to include student loan forgiveness in the recently-announced proposals. The President is set to announce his annual federal budget on 28 May and reports suggest that student loan forgiveness will not be included.

Cody Hounanian, Program Director at Student Debt Crisis, described the exclusion as “a missed opportunity to use the weight of his office to push for this much-needed relief.”

He added: “President Biden campaigned on a promise to cancel student debt, and millions of Americans expect him to follow through with that promise.”

Can Biden use executive orders to pass student loan forgiveness?

Although there is an expectation that Biden could use his executive authority to push through student loan forgiveness, the reality is that the extent of these powers is disputed.

Speaking to CNBC, higher education expert Mark Kantrowitz explains that Biden is still waiting for the outcome of a joint Department of Justice and Department of Education report into “his legal authority to forgive student loan debt through executive order.”

Kantrowitz says: “Only after he receives that report, which I expect will find that he does not have the legal authority, will the ball be in Congress’ court.”

However Persis Yu, Director of The National Consumer Law Center’s Student Loan Borrower Assistance Project, has already conducted a similar review and believes that the President is able to address the student loan issue using executive authority.

She said: “We are confident that this review will reach the same conclusion that we have reached: that the President already has the authority to provide widespread student debt cancellation with the stroke of a pen.”


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