KEY TAKEAWAYS
- President Joe Biden’s administration has scrapped a proposal to provide student debt relief to borrowers who experienced financial hardships.
- The Department of Education insisted the withdrawal was due to timing and the administration had the authority to administer this relief.
- The administration has been focusing on tying up its loose ends before a potential President-elect Donald Trump enters the White House.
President Joe Biden’s administration withdrew a proposal to provide student debt relief to borrowers nearly 8 million borrowers.
The proposal, originally announced in October, would have forgiven the qualifying student loans of borrowers who had extensive medical bills, child care costs, family care expenses or economic hardship caused by a natural disaster.
The Department of Education said it was withdrawing the proposal because the administration wants to focus on other priorities with the remaining time before President-elect Donald Trump takes office. These priorities included helping borrowers after the on-ramp period ended, which gave borrowers time to begin repaying after the pandemic pause.
However, the department insisted it had the authority to administer student debt relief to borrowers whose hardships made it difficult to afford their payments. Whether the president’s administration can unilaterally forgive student debt without congressional approval has been a point of contention in a number of legal challenges to Biden’s student loan relief programs.
This withdrawal was part of a larger initiative by the Biden administration to tie up its loose ends before a potential government shutdown and President-elect Donald Trump’s inauguration. The administration also forgave $4.28 billion in student loans for public service workers Friday.
