Evan Linett is a staff writer for Brief Policy Perspectives and a first-year MPP student.  

Student Loan Debt Is A Widespread Problem

Every year, more Americans take out student loans to offset the rising cost of higher education. For Susan, a 59-year-old single mom and small business owner, the effects of these loans have become a long-term struggle: “My Parent PLUS loan debt is $70K. I can’t even think about retiring, buying a home, or enjoying my golden years. I have paid on these loans from the very beginning, but the balance never changes. I need help.” Susan’s story reflects a larger national issue— more Americans than ever owe crisis-level debts to the federal government.

In 2021, 44.7 million Americans held outstanding federal student loan debt. Among today’s college students, 65% will graduate with student debt. With the Biden-Harris Administration’s announcement to pause student loan repayments through May 2022, will Biden, or Congress, take further action to confront the rising level of student debt?

President Biden Has Not Yet Fulfilled His Promise to Reduce Student Loan Debt

As a 2020 presidential hopeful, Biden campaigned to “make sure that everybody in this generation gets $10,000 knocked off their student debt.” However, the Biden-Harris administration has not yet enacted wide-scale student loan cancellation. Since taking office in January 2021, the administration has forgiven $11.5 billion in student loans through existing programs run by the U.S. Department of Education. That includes the cancelation of $5.8 billion in student loan debt for more than 323,000 borrowers with total and permanent disabilities.

While a promising start, the Administration’s efforts to reduce student debt amount to less than 1 percent of the $1.75 trillion in total student loan debt held by borrowers. To put this figure in perspective, Brookings estimates that providing a one-time cancellation of $10,000 in federal student loan debt would cost the government about $373 billion. The Biden-Harris Administration evidently has a lot of work left to make good on their campaign promise to enact mass student loan forgiveness.

Does the President Have Authority to Act on Student Loan Forgiveness?

The Higher Education Act of 1965 grants the presidential administration the authority to direct the Secretary of Education to create, cancel, or modify debt owed under federal student loan programs. In March 2020, the Higher Education Act provided authority for the Office of Federal Student Aid to pause student loan debt repayment, which has continued throughout the COVID-19 pandemic. However, experts are divided on what kinds of loans the Higher Education Act applies to, and whether the President can authorize widespread debt cancellation through an executive order.

Proponents of student debt relief argue that the President has not fully exercised the authority set forth in the Higher Education Act to reduce the burden of student loans for borrowers. While congressional Democrats have introduced bills for forgiving partial or all debt, President Biden has come under increasing pressure to pursue loan forgiveness through executive action. In response, Education Secretary Miguel Cardona said that President Biden is “examining loan forgiveness.” The White House directed Secretary Cardona to prepare a memo about the President’s legal authority to cancel student loan debt. President Biden has also said that he’d like Congress to take action.

Will Congress Act?

More recently, the Biden-Harris Administration has shifted the burden for Congress to enact student loan debt forgiveness. In December 2021, White House press secretary Jen Psaki responded to a reporter’s question about where wide-scale debt relief stood by saying: “If Congress sends him a bill, he’s happy to sign it. They haven’t sent him a bill on that yet.” Whether or not the Biden-Harris Administration believes they have the authority to take executive action to forgive student loan debt, it is clear that they prefer that Congress act on it.

Passing student debt forgiveness legislation through Congress would be a difficult task, even with Democrats holding the majority in both chambers. Moderate Democrats haven’t expressed support for canceling student debt, while their votes would be critical in achieving a legislative outcome. Meanwhile, Republicans in Congress have proposed two alternative pieces of legislation for dealing with the issue of student debt: by eliminating interest on federal loans, and by allowing borrowers to pay off student loan debt with 401(k) and IRA savings. In all, there is very little bipartisan congressional support to act on student loan debt forgiveness.

What Comes Next

The pathway for addressing the student debt crisis through legislation has narrowed as the burden has shifted from the White House to Congress. While President Biden campaigned on forgiving up to $10,000 in student loan debt per borrower, he has since said that any such action would have to come from Congress. Unless the Biden-Harris Administration pursues executive authority to address the student loan debt crisis, advancement on this issue will likely come to a standstill.