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With Democrats in control of the White House and Congress, student debt forgiveness has a better chance of becoming a reality for millions of Americans.
Even so, there are obstacles.
Will debt cancellation be a priority for the young Biden government, which enters the scene amid unprecedented economic and health duels and crises?
“They probably created a hierarchy of legislation that they think is important,” said Richard Semiatin, an assistant professor at American University. “It is unlikely to be at the first level.”
In the election campaign, President-elect Joe Biden pledged to forgive $ 10,000 in student debt to all borrowers in response to the economic pain caused by the pandemic, and the rest of the loans to those who have attended public colleges or historically black colleges and universities earn less than $ 125,000 a year.
“We look forward to fulfilling that promise,” said Persis Yu, director of the Student Loan Assistance Project for Students at the National Consumer Law Center, a nonprofit advocacy group.
A recent poll found that 58% of registered voters support student debt cancellation.
Administrative or legislative forgiveness?
Some Democratic senators are pressing Biden to bypass Congress and cancel the debt on his own.
Senator Elizabeth Warren, D-Mass., Recently described student debt forgiveness as “the most effective economic stimulus that is available through executive action”. Meanwhile, the Senate’s top Democrat, Chuck Schumer, DN.Y., asks Biden to forgive $ 50,000 per borrower on the first day of his presidency. “All you need is a touch of a pen,” said Schumer in December. “You don’t need Congress.”
Not everyone agrees. Experts say Biden is likely to face legal challenges if he decides to cancel the debt on his own.
And now that Democrats have secured a majority in Congress, the legislative path may look more promising. However, there is a long way from hope until borrowers have their debts reduced or eliminated.
Even with the two Senate seats won by Democrats in Georgia, the party has just won a majority and will need elected Vice President Kamala Harris to gather 51 votes against the 50 Republicans.
Not all Democrats can agree to forgive student debt, and even if they were, Senate procedural rules often require legislation to garner 60 votes. It will be difficult to get nine Republicans to support a debt jubilee.
“With democratic government control, Republicans are likely to reaffirm their interest in the federal deficit and government spending,” said Laurel Harbridge-Yong, associate professor at Northwestern University.
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Still, there may be a way around these rules. An annual legislative process called budget reconciliation will allow Democrats to pass bills with a simple majority. That’s how Democrats passed the final version of the Affordable Care Act in 2010. It’s also how Republicans passed their massive tax cuts in 2017.
But there are limits to this method, said Ryan D. Doerfler, a law professor at the University of Chicago. “Democrats can only use reconciliation procedures three times in the next two years,” he said. Since this process can only be used once a year, there is often a lot of competition over what to include, and this will be particularly true during the pandemic.
Reconciliation legislation must also be related to budget changes, and senators can try to block any provisions that they argue are not.
Given all the uncertainty of trying to pass legislation to forgive student debt, defenders and Democrats continue to ask Biden to cancel the loans administratively, saying that borrowers cannot wait for relief.
“President Biden has a historic opportunity to improve the lives of tens of millions of American families struggling in the midst of a national crisis,” said Seth Frotman, who served as student loan ombudsman at the Consumer Financial Protection Bureau during the Obama administration.