The Biden administration announced Friday afternoon that it is extending the student loan repayment pause through January 2022.
The extension, which the administration said would be the final one, pauses loan repayment, interest and collections until February of next year.
Some key Democrats, including Senate Majority Leader Chuck Schumer (D-NY), applauded the move but said it falls short of what’s needed.
“While this temporary relief is welcome, it doesn’t go far enough,” Schumer, Sen. Elizabeth Warren (D-MA) and Rep. Ayanna Pressley (D-MA) said in a joint statement. “We continue to call on the administration to use its existing executive authority to cancel $50,000 of student debt. Student debt cancellation is one of the most significant actions that President Biden can take right now to build a more just economy and address racial inequity.”
Advocates for debt cancellation have long said that President Joe Biden could eliminate up to $50,000 with just an executive order.
Biden said at a February town hall that he doesn’t think he has the authority to do it. He also expressed concern that most of the benefit would go to students who attended elite private schools.
“It depends on the idea that I say to a community, ‘I’m going to forgive the debt, the billions of dollars of debt, for people who have gone to Harvard and Yale and Penn,’” he said.
House Speaker Nancy Pelosi (D-CA) echoed his argument that he doesn’t have the power to do it unilaterally last week.
“People think that the President of the United States has the power for debt forgiveness,” she said. “He does not. He can postpone, he can delay, but he does not have that power.”
There is some legal uncertainty around the question. The Higher Education Act grants education secretaries the power to “enforce, pay, compromise, waive, or release” government-held student loans, which is how Education Secretary Miguel Cardona
can institute the pause in the first place. It’s not clear how that applies to mass cancellation, though some experts think it passes legal muster. Such a move on Biden’s part would be likely be followed by litigation.
The President called for his administration to do a thorough investigation of whether or not he has the authority in April.
As of early July, the Biden administration had erased about $1.5 billion in student debt, some of it by forgiving the loans of student borrowers who were defrauded by schools.