BY Sydney LakeNovember 01, 2021, 8:26 PM
Rep. Alexandria Ocasio-Cortez (DN.Y.) speaks at a news conference on legislation that would strengthen Social Security benefits, October 2021.
Drew Angerer/Getty Images
There are only 92 days until federal student loan payments make their comeback—plus conversations about the possibility of debt cancellation are ongoing. Since his inauguration in January, President Joe Biden has canceled more than $11 billion in targeted student loan debt, but that amount only accounts for less than 1% of all federal loans.
So far, debt cancellation has helped borrowers who attended now-defunct institutions, borrowers with total and permanent disabilities, and public service workers. Democrats, however, are continuing to push Biden and the US Department of Education to make moves on more widespread student loan debt amid negotiations on the president’s Build Back Better framework. The goal of the BBB budget is to “rescue, recover, and rebuild the country,” according to the White House, and addresses issues ranging from childcare to climate change to Medicare expansion. The budget for BBB was recently slashed from $3 trillion to $1.75 trillion.
“I think given how much [Build Back Better] has been slashed there is more opportunity than ever to bring the heat on Biden to cancel student loans,” US Rep. Alexandria Ocasio-Cortez said in an Instagram story on Oct. 28, the same day Biden released an updated framework for the BBB budget resolution.
What does Biden think about student loan forgiveness?
On the presidential campaign trail, Biden promised to immediately cancel $10,000 in student debt per borrower, but that hasn’t happened. He disagrees with other Democrats—including Ocasio-Cortez, Senate Majority Leader Chuck Schumer, and Sen. Elizabeth Warren—on two main student loan forgiveness elements: how much debt should be canceled per borrower and how the debt should be forgiven.
Democratic leaders have pushed Biden to cancel up to $50,000 in debt for federal student loan borrowers, but he won’t budget. When asked at a CNN town hall on Feb. 17, 2021, how he would make the $50,000 in forgiveness per borrower happen, he responded: “I will not make that happen.” Instead, he said he was “prepared to write off” $10,000 in debt per borrower.
Biden also said during the February town hall that he doesn’t want to forgive debts from borrowers who attended elite schools, arguing that money would be better spent on early childhood education.
“Who cares what school someone went to?” Ocasio-Cortez tweeted in response. “Entire generations of working class kids were encouraged to go into more debt under the guise of elitism. This is wrong. Nowhere does it say we must trade-off early childhood education for student loan forgiveness. We can have both.”
Does Biden have the authority to cancel student loans en masse?
Ocasio-Cortez, Schumer, and Warren also argue that Biden has the executive power to cancel a student loan debt en masse.
“He doesn’t need [Sen. Joe] Manchin’s permission for that, and now that his agenda is thinly sliced, he needs to step up his action game and show his executive commitment to deliver for the people,” Ocasio-Cortez said on Instagram on Oct. 28. “We need to get this done.”
Biden has previously disagreed with this assessment.
“I don’t think I have the authority to do it by signing [an executive order],” Biden said during the February 2021 town hall. Speaker of the House Nancy Pelosi agrees with Biden that this type of debt cancellation could be accomplished only by an act of Congress.
“People think that the president of the United States has the power for debt forgiveness,” Pelosi said in July. “He does not. He can postpone, he can delay, but he does not have that power.”
Student loan forgiveness in 2021
Since taking office, Biden has announced an overhaul to the Public Service Loan Forgiveness (PSLF) program and canceled debt for those attended now-defunct institutions, as well as borrowers with total and permanent disabilities.
Ultimately these measures will help hundreds of thousands of borrowers, but that’s just a “drop in the bucket,” as Cody Hounanian, executive director of the Student Debt Crisis Center, puts it. There are more than 43 million borrowers who hold federal student loans totaling more than $1.7 trillion in debt.
Payments on federal student loans have been paused since March 2020. The CARES Act granted forbearance, allowing student borrowers to choose whether or not to continue making payments during the pandemic. This well will run dry, though, at the end of January 2022; federal student loan payments will ramp back up on Feb. 1, 2022.
Democrats like Ocasio-Cortez, Schumer, and Warren have also been consistently pushing for the forbearance deadline to be extended—but to no avail. Biden and other White House officials announced in August that this was the final such extension on student loan forbearance.
“We need to organize and prepare actions now because the showdown will be in late January when payments are ‘upposed’ to kick back up,” Ocasio-Cortez said on Instagram.
See how the schools you’re considering fared in Fortune’s rankings of the best executive, full-time, and online MBA programs.