A group of 17 state attorneys general is calling for the cancellation of up to $50,000 in federal student loan debt for all borrowers.
The Democratic attorneys general, led by New York Attorney General Letitia James and Massachusetts Attorney General Maura Healey, sent a letter to congressional leaders on Friday supporting resolutions that call on President Biden to use executive action to forgive outstanding student loans.
“Because we are responsible for enforcing our consumer protection laws, we are keenly aware of the substantial burden Federal student loan debt places on the residents of our states. Our Offices routinely receive complaints from borrowers who are unable to navigate the abstruse and opaque repayment or forgiveness plans available under current law,” the statement read.
“Student loan borrowers were already struggling before the COVID-19 pandemic and recession. Many borrowers already owed more than they originally borrowed. As many as one in five Federal student loan borrowers are in default.”
“Many are unable to manage their debt due to disability, illness, or job loss. A growing number are senior citizens living on low fixed incomes. Struggling borrowers are unable to obtain meaningful relief in bankruptcy because under current law, Federal student loans are not dischargeable except under extremely narrow circumstances.”
“Significantly, the for-profit school industry has deliberately targeted people of color, who, as a result, are disproportionately represented among students struggling with Federal student loans incurred to attend for-profit schools. Student debt cancellation can substantially increase Black and Latinx household wealth and help close the racial wealth gap.”
At a CNN town hall earlier this week when asked about canceling up to $50,000 in student loan debt, Biden said, he would “not make that happen.”
He went on to say, “I understand the impact of debt, and it can be debilitating. I am prepared to write off the $10,000 debt but not $50 [thousand], because I don’t think I have the authority to do it.”
The President has indicated that his preference would be for Congress to pass legislation providing student loan relief, including student loan forgiveness. Meanwhile, the White House has tasked the U.S. Department of Justice with evaluating the legality of canceling student debt through executive action alone.