The White House announced on Friday that the Biden administration will forgive $7.4 billion in student debt for 277,000 borrowers, marking the latest in a series of debt cancellations. In a bid to address a crucial concern for young voters ahead of the November reelection campaign, Joe Biden revealed plans on Monday to alleviate student debt, benefiting an estimated 23 million Americans. These plans include cancelling up to $20,000 of accrued and capitalized interest for borrowers, regardless of income, potentially wiping out all such interest for the 23 million borrowers.
The recent debt relief targets 277,000 individuals enrolled in the Save Plan, as well as other borrowers in Income-Driven Repayment plans and those receiving Public Service Loan Forgiveness, as per a statement from the White House.
This move follows a previous announcement in March, wherein $6 billion in student loans were slated for cancellation, benefitting 78,000 borrowers. On Friday, the administration announced the approval of $153 billion in student debt relief for 4.3 million Americans.
After the US Supreme Court blocked his broader plan to cancel $430 billion in student loan debt last June, President Biden, a Democrat, pledged to explore alternative avenues for addressing debt relief. His Republican challenger in the White House race, former President Donald Trump’s campaign, criticized the student loan cancellation in March as a bailout executed “without a single act of Congress.”
The student debt issue remains a significant concern for younger voters, many of whom also express reservations about Biden’s foreign policy regarding the conflict in Gaza and fault him for not achieving more substantial debt forgiveness.
Republicans argue that Biden’s approach to student loan forgiveness exceeds his authority and unfairly benefits college-educated borrowers over others who receive no such relief.
According to the Brookings Institution think tank, approximately half of federal student loan debt is held by individuals with graduate degrees. A report from the Department of Education in August 2023 revealed that graduate students, though comprising only 21% of all borrowers, received the highest share (47%) of federal student loan disbursements from 2021-22.