The US Department of Education has cancelled more than $9bn in student loan debt since Joe Biden took office.
The cancellations affect more than 563,000 borrowers.
The numbers were included in an announcement by the department detailing its forgiveness of $1.1bn for 115,000 borrowers who attended the now defunct ITT Technical Institute.
The borrowers were given reprieve because they attended the school at a time when it misrepresented its financial state and misled students into believing that hefty private loans were actually grants.
“ITT’s malfeasance drove its financial resources away from educating students in order to keep the school in business for years longer than it likely would otherwise have, resulting in debts that are being discharged starting today,” the agency said.
Earlier this month, the Biden administration announced it planned to forgive $5.8bn in federal student loans for 323,000 borrowers that were identified by the Social Security Administration as totally and permanently disabled.
Mr Biden has faced pressure from progressive groups to enact widespread student loan forgiveness. Almost 43 million Americans have student loan debt, totalling $1.57 trillion. The push for Mr Biden to cancel student loan debts is rooted in the idea that hefty debts are preventing tens of millions of Americans from buying homes, cars and starting families. The inability of tens of millions of Americans to make major financial investments, as advocates argue, is stunting the US economy.
During his presidential campaign, Mr Biden promised to “forgive a minimum of $10,000 per person of federal student loans”, an act that would erase all the debt for 15 million Americans. However, Mr Biden has yet to act on that promise. Student loan forgiveness was not included in Mr Biden’s 2021 annual budget.
Since his election, Mr Biden has shifted in his position slightly, suggesting that it should be Congress – and not his executive power – that cancels student loan debt. Due to the need for Senate Republicans to sign onto such a bill for passage, it is extremely unlikely that Congress would cancel the loans.
The US Department of Education has reportedly been preparing a legal analysis concerning Mr Biden’s ability to cancel loans using executive power, but that assessment has not been made public.
Despite the lack of forward momentum for wide scale student loan relief, Mr Biden has taken some steps to take the burden off of borrowers during the coronavirus pandemic. He has twice extended the loan relief introduced in the Cares Act, and he has said he is committed to simplifying the income-based repayment plans that many borrowers currently utilise.
Mr Biden has also expressed a willingness to adjust the Public Service Loan Forgiveness program so that more borrowers qualify for the program.
