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The Biden administration is offering a new round of student loan debt relief for more than half a million borrowers who were students of Corinthian Colleges.
The action will see $5.8 billion in full loan discharges for 560,000 borrowers, marking the single largest loan discharge in the history of the Department of Education, and brings the total student debt relief extended by the administration to $25 billion.
BIDEN STUDENT DEBT CANCELLATION PLAN AIMED AT FIRING UP LIBERAL VOTERS
Corinthian operated from 1995 to 2015. In 2013, then-California Attorney General Kamala Harris sued Corinthian before carrying out a full investigation, which found “comprehensive” wrongdoing carried out against students across the nation, including lying to prospective students about graduation and job placement rates.
Prior to Wednesday, the administration had extended loan debt relief to more than 1.3 million borrowers through the Public Service Loan Forgiveness program, borrower defense initiatives, permanent disability discharges, and other measures to help students defrauded by schools. The Department of Education confirmed Wednesday that every student who ever attended a Corinthian school was defrauded and that anyone with remaining federal loans is eligible for borrower defense. Roughly 100,000 Corinthian borrowers have been approved for borrower defense relief.
“As of today, every student deceived, defrauded, and driven into debt by Corinthian Colleges can rest assured that the Biden-Harris Administration has their back and will discharge their federal student loans,” Secretary of Education Miguel Cardona said in a statement. “For far too long, Corinthian engaged in the wholesale financial exploitation of students, misleading them into taking on more and more debt to pay for promises they would never keep. While our actions today will relieve Corinthian Colleges’ victims of their burdens, the Department of Education is actively ramping up oversight to better protect today’s students from tactics and make sure that for-profit institutions — and the corporations that own them — never again get away with such abuse.”
The announcement comes as President Joe Biden reportedly weighs canceling an additional $10,000 in student loan debt for all borrowers earning less than $150,000 per year or for joint filers earning less than $300,000.
Still, Biden faces major pressure from liberal activists and lawmakers to move quickly on debt both to keep one of his core campaign promises and to give Democrats momentum heading into November. Several politicians, including Senate Majority Leader Chuck Schumer (D-NY) and Sen. Elizabeth Warren (D-MA), have called on Biden to wipe out even more debt.
Some party officials have signaled to the Washington Examiner that they believe student debt presents an opportunity for the president to make headway with voters on “advancing gender and racial equity” when considering that black borrowers on average finish their bachelor’s degrees with a debt of nearly $5,000 more than white borrowers, with the disparity between black and white female borrowers being even larger.
“This is a major problem facing younger Americans, but it’s also obviously a potential huge win for President Biden after [Sen. Joe] Manchin (D-WV) blocked him from addressing voting rights,” one official said. “The party needs black voters to turn out at 2020 levels to hold on to congressional majorities, which will be essential to furthering the president’s economic agenda. Two birds, one stone.”
CLICK HERE TO READ MORE FROM THE WASHINGTON EXAMINER
Fiscal conservatives, however, predict that Biden’s loan relief could exacerbate already historic inflation, and elected Republicans have stated that the initiative should be viewed as an outright bribe heading into the midterm elections.
