by Bruce Walker
Seven state attorneys general, and an eighth from Puerto Rico, have called upon President Joe Biden to fully cancel federal student debt estimated at more than $1.6 trillion.
The U.S. Education Department reports more than 43 million borrowers on average owe $37,000 in student loan debt. The USED already has forgiven $17 billion in student loan debt held by 725,000 borrowers since the beginning of the Biden administration.
The prosecutors are Hawaii’s Holly Shikada, Illinois’ Kwame Raoul, Michigan’s Dana Nessel, Minnesota’s Keith Ellison, New Mexico’s Hector Balderas, New York’s Letitia James, Washington’s Bob Ferguson, and Puerto Rico’s Domingo Emanuelli Hernandez. All are Democrats.
According to the U.S. Chamber of Commerce:
- 40% of student loan debt is held by individuals with advanced degrees, such as doctors and lawyers.
- 10% of all student loan debt is held by the bottom fifth of income earners.
- 40% of the total federal student debt is held by those in graduate programs.
- Graduate students borrowed $18,210 per year on average during 2015 compared to an undergrad’s $5,460.
- Master’s degrees usually take between two and five years to complete. The average debt of a master’s graduate is $51,000.
- An MBA degree averaged $42,000 in debt.
- The average medical school debt is approximately $194,000.
Requirements for student loan repayments have been on ice since the beginning of the COVID-19 pandemic in March 2020. The latest nonrepayment extension expires Aug. 31. Last month, the Wall Street Journal reported, the Education Department announced plans to revamp its loan program to grant 10%, or 3.5 million borrowers, three years of credit on total loan forgiveness based on the borrowers’ incomes.
In their letter to the president, the AGs ask Biden to make good on his administration’s attempts to lessen the debt burden of student loan borrowers. They are seeking full forgiveness for every borrower. Sen. Majority Leader Charles Schumer, D-NY, told an activist group last month he hopes the amount is $50,000 per borrower.
Biden has expressed his desire to forgive $10,000 of all student loans. In remarks last week following a meeting with Democratic lawmakers, he said he was “taking a hard look” at canceling additional student loan debt. He did not give a number, but said $50,000 was not under consideration.
“Hardships created by the pandemic – and the subsequent hold on loan payments – prove we are equipped to cancel student debt once and for all,” Michigan’s Nessel said in a statement. “I stand with my colleagues in asking President Biden to bring this much-needed relief to millions of borrowers across the country.”
The AGs presented a list of reasons why the president should excuse all student loan debt by exercising his authority under the Higher Education Act, including:
- A full cancelation of student debt is necessary to address the sheer enormity of debts owed.
- The systemically flawed repayment and forgiveness systems for repayment of student loans.
- The disproportionate impact of the debt burden on millions of borrowers.
The AGs continue that forgiveness of student loan debts will:
- Reduce stress and mental fatigue.
- Provide countless opportunities for borrowers, such as saving for retirement and purchasing new homes.
- Substantially help close the racial wealth gap.
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Bruce Walker is a regional editor at The Center Square. He previously worked as editor at the Mackinac Center for Public Policy’s MichiganScience magazine and The Heartland Institute’s InfoTech & Telecom News.