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Student loan forgiveness is more likely, but challenges remain



Senator Elizabeth Warren, Democratic Senator of Massachusetts, speaks, and James Clyburn, the Democratic House Member of the House of Representatives from South Carolina on the right, cancels the cancellation on Tuesday, July 23, 2019 in Washington, DC, U.S. Listen at a press conference on student loan debt.

Andrew Haller | Bloomberg | Getty Images

With the Democrats in control of the White House and Congress, student debt forgiveness is a better shot of thousands of Americans becoming a reality.

Nevertheless, there are still obstacles.

In the face of duels and unprecedented health and economic crises, is debt forgiveness a priority for the young Biden administration?

American University Assistant Professor Richard Semiatin (Richard Semiatin) said: “They may have established a legislative system that they consider important.”

; “This is unlikely to be on the first level.”

During the campaign, President-elect Biden promised to forgive student debt for all borrowers of $10,000 in response to the economic pain caused by the pandemic, and will use the loan for the rest of those who attend public colleges or traditional black universities with low annual income At $125,000.

Persis Yu, head of the “Student Loan Borrower Assistance Program” of the National Consumer Law Center, a non-profit advocacy organization, said: “We hope to keep this promise.”

A recent survey found that 58% of registered voters support cancellation of student debt.

Administrative or legislative forgiveness?

Some Democratic senators are urging Biden to bypass Congress and cancel the debt on his own.

Senator Elizabeth Warren, Democrat of Massachusetts, recently described student debt relief as “the most effective single economic stimulus available through administrative measures.” At the same time, Chuck Schumer, the top Democrat in the Senate, called on Biden to forgive each borrower $50,000 on the first day of his presidency. Schumer said in December: “All you need is the flick of a pen.” “You don’t need Congress.”

Not everyone agrees. Experts say that if Biden cancels the debt by himself, he may face challenges from the court.

Now that the Democrats have won a majority in Congress, the legislative approach seems more promising. However, there is still a long way to go from promising until the borrower sees its debt reduction or elimination.

Even if the two Senate Democrats pick up in Georgia, the party has only slightly increased by the vast majority, and it needs the intervention of Vice President-elect Kamala Harris to bounce 51 votes against the Republican 50.

Not all Democrats can ask students for debt relief. Even so, the Senate’s procedural rules usually require 60 votes for legislation. It is difficult to have nine Republicans supporting the debt anniversary.

Laurel Harbridge Yong, an associate professor at Northwestern University, said: “With democratic control of the government, the Republican Party is likely to renew its interest in federal deficits and government spending.”

More information from personal finance:
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However, these rules can still be bypassed. The annual legislative process called the budget reconciliation will enable the Democratic Party to pass the bill with a simple majority. This is how the Democrats pushed for the final version of the Affordable Care Act in 2010. This is how Republicans adopted massive tax cuts in 2017.

Ryan D. Doerfler, a professor of law at the University of Chicago, said that this approach has limitations. He said: “In the next two years, the Democratic Party can only use the settlement process three times.” Since this process can only be used once a year, there is usually a lot of competition in what it contains, especially during a pandemic.

Settlement legislation must also be related to budget changes, and senators can try to block any regulations that they believe are not related to the budget.

In view of the uncertainty of trying to pass legislation to forgive student debt, advocates and Democrats continue to call on Biden to cancel loans administratively, saying that borrowers cannot wait for debt relief.​​​

Seth Frotman, the student loan monitor of the Consumer Financial Protection Bureau during the Obama administration, said: “President Biden has a historic opportunity to improve the tens of millions of Americans struggling in the national crisis. Family life.”


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