Biden administration wipes out more student loan debt

“The Department will continue doing its part to review and approve borrower defense claims quickly and fairly so that borrowers receive the relief that they need and deserve. We also hope these approvals serve as a warning to any institution engaging in similar conduct that this type of misrepresentation is unacceptable,” said U.S. Secretary of Education Miguel Cardona in a released statement on Friday.

This is the third round of forgiveness by the Biden administration. In late March, the Department of Education announced it will forgive $1 billion in student debt held by defrauded borrowers from students who attended ITT Technical Institute schools, Corinthian Colleges, and American Career Institute. That month, the Department of Education also announced plans to forgive another $1.3 billion held by Americans with permanent disabilities.

But in the grand scheme of things those rounds of student loan forgiveness are pretty small. In total, there is around $1.7 trillion—yes, trillion with a T—total outstanding student loan debt. Of that, more than $1.4 trillion is federal student loan debt.

But as the Biden staffed Department of Education continues to look into more rounds of student loan forgiveness, it begs the question if it’s setting the stage for a broader debt discharge?

Biden says he supports Congress passing a bill to forgive up to $10,000 per student loan borrower. However, earlier this year, Biden made it very clear he doesn’t support $50,000 forgiveness per student, telling the press, “I will not make that happen.” But that isn’t stopping members of his own party from calling for him to do mass forgiveness through executive order. Some democratic lawmakers are interested in that route given that forgiveness could be blocked by Republicans or moderate Democrats in the U.S. Senate.

What gives progressive activists hope? On the request of the White House, the Secretary of Education announced this spring he’d actively exploring if the executive branch has the legal authority to wipe out massive levels of student loan debt. It’s unclear if that report is complete.