President Joe Biden will make an announcement regarding student loans on Wednesday, according to reports.
The news comes as the White House has been teasing for months that it may fulfill Biden’s campaign promise to “cancel” $10,000 of debt per borrower.
BIDEN’S DILEMMA: CANCEL STUDENT LOANS OR TAKE CREDIT FOR CUTTING DEFICIT
A pause on student loan payments has been in place since March 2020 and is set to expire next Wednesday. However, White House officials have said for months that the pause would either be extended or an announcement would be made to cancel debt, with the most common figure being $10,000 per borrower, and the Associated Press reported both moves are expected this Wednesday.
Biden has extended the payment pause four times since taking office, most recently in April.
Reports hold that the White House is leaning toward a plan that would shift $10,000 per borrower of debt to taxpayers, with an income threshold of $125,000 a year. There could be additional programs for specific subsets of the population.
When asked about the announcement, a White House spokesperson said, “The president will have more to say on this before Aug. 31. As a reminder, no one with a federally held loan has had to pay a single dime in student loans since President Biden took office, and this administration has already canceled about $32 billion in debt for more than 1.6 million Americans — more than any administration in history.”
The spokesperson did not respond to a question about what will be announced Wednesday.
The cancellation plan is popular with Democrats, with legislators such as Sen. Elizabeth Warren (D-MA) and groups including the NAACP suggesting that Biden go as high as $50,000 per borrower.
However, conservatives have raised ethical concerns over White House employees who would personally benefit from the program. Biden’s staffers collectively owe as much as $4.7 million in student loans.
Canceling $10,000 of debt would cost also taxpayers roughly $250 billion, according to the Committee for a Responsible Federal Budget, undermining almost all of the debt savings from the recently passed Inflation Reduction Act.
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More than 40 million people in the U.S. hold a combined $1.7 trillion in federal student loans.
Biden has been on vacation for most of the last two weeks and will return to Washington on Wednesday.
