Home Posts Democrats Urge The Administration To Keep The Student Loan Payment Freeze In Place.
Democrats Urge The Administration To Keep The Student Loan Payment Freeze In Place.
Elizabeth Warren

Democrats Urge The Administration To Keep The Student Loan Payment Freeze In Place.

On Wednesday, more than 60 Democratic members of Congress wrote to President Joe Biden, urging him to extend a six-month moratorium on federal student loan payments imposed during the Coronavirus outbreak.

The pause in student loan payments is set to expire on September 30. The Democrats who signed the letter, led by Massachusetts Senator Elizabeth Warren and New York Senate Majority Leader Chuck Schumer, are asking Biden to extend the pause until March 30, 2022, or until employment reaches pre-pandemic levels.

“Borrowers have reaped significant benefits from the ongoing payment pause, taking the opportunity to pay down other debt, relieve financial pressures from lost jobs or reduced earnings, and support the needs of their families,” the members wrote.

“The planned resumption of student loan payments in October could create a significant drag on our economic recovery,” they added.

The Education Department, which oversees the federal government's $1.4 trillion student loan portfolio, declined to comment on the letter, despite the fact that that portfolio, which includes debt held by more than 40 million borrowers, accounts for the majority of student loan debt in the United States.

While many of the 64 congressional Democrats who signed the letter are liberals who have long advocated for student loan forgiveness, several moderate Democrats, including Arizona Sen. Kyrsten Sinema and Connecticut Rep. Jim Himes, also signed.

The letter's lead authors were House Democrats Ayanna Pressley (D-Mass.) and Joe Courtney (D-Conn.).

Former President Donald Trump initiated the moratorium shortly after the pandemic began, and Biden extended it until the end of September on his first day in office. Whether to extend the moratorium further is a critical decision that Biden, Education Secretary Miguel Cardona, and Federal Student Aid COO Richard Cordray must make.

Advocates for student loan reform and large-scale debt forgiveness applauded Cordray's appointment in May, a Warren ally who led the Consumer Financial Protection Bureau during Barack Obama's presidency.

Warren has continued to press the Biden administration on the student loan crisis; she and Schumer have advocated for up to $50,000 per borrower in loan forgiveness.

She also recently put a hold on the nomination of James Kvaal, Biden's pick for the third-highest ranking job at the Department of Education, in the hopes of forcing reforms in how the department manages student loans. (Politico was the first to report Warren's move.)

The Department of Education's spokesperson played down the conflict.

“We’ve been working with Senate offices and are encouraged by the conversations and developments surrounding James Kvaal’s nomination,” the agency said, adding that “we share the same goals around making the Federal Student Aid office more consumer friendly and an advocate for student borrowers, which is why we’ve taken multiple actions to achieve this goal, including providing nearly $3 billion in targeted loan rescission.

The Department of Education and the White House are still determining whether Biden has the legal authority to unilaterally forgive student loan debt and whether doing so would be good policy, despite the president's public rejection of widespread debt forgiveness.

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