Senate Majority Leader Chuck Schumer (D-NY), Sen. Elizabeth Warren (D-MA), and Rep. Ayanna Pressley (D-MA) are joining other progressive voices pushing President Joe Biden to extend the pause on federal student loan payments.
Last year, the CARES Act paused student debt payments and set the federal student loan interest rate at 0% — a policy extended by both President Donald Trump and Biden. The suspension is due to expire on January 31, barring further action from the White House.
Accordingly, Schumer, Warren, and Pressley told Biden in a letter that another pause on debt payments would enhance economic growth following COVID-19 and the lockdown-induced recession:
A new analysis, prepared at our request by experts from the Roosevelt Institute, found that the resumption of federal student loan payments — which is scheduled to occur 55 days from today when the coronavirus disease 2019 (COVID-19) payment moratorium ends — will strip more than $85 billion from approximately 18 million American families over the next year.
In order to prevent the student debt crisis from dragging down on our economic recovery, undermining the effectiveness of the American Rescue Plan, and causing unnecessary pain and stress for American families, we strongly urge you to extend the pause on student loan payments and interest and act to cancel student debt.
The lawmakers also highlighted the implications of student debt upon “borrowers of color” — namely, black and “Latinx” households:
Moreover, according to the Roosevelt analysis, “Black and Latinx households would feel a disproportionate negative impact from resuming student loan repayments. Borrowers of color typically borrow more for college expenses than their white counterparts while also holding significantly less wealth.” Twenty years after starting college, the median Black borrower still owes 95% of their loans, compared to only 6% for the median white borrower. These significant disparities contribute to the racial wealth gap.
Another recent letter to President Biden — signed by progressive groups such as the American Association of University Professors, the American Civil Liberties Union, the American Federation of Teachers, the American Psychological Association, Fossil Fuel Divest Harvard, and the NAACP — argued along similar lines:
It is critical that your administration continue to deliver on your promises made to student loan borrowers and their families before ending the pause in payments and collections. Borrowers need immediate relief from the crushing burdens of massive student loan debt as the pandemic exacerbates financial strain for all Americans and throws existing racial disparities in wealth and educational attainment into especially stark relief.
In reaction to a recent speech from Rep. Rashida Tlaib (D-MI) — during which the lawmaker discussed her own failure to pay back student loans — Daily Wire commentator and bestselling children’s author Matt Walsh noted that student debt forgiveness is a glorified form of “welfare” for the affluent.
“She’s a perfect example of why we shouldn’t forgive student loans,” Walsh tweeted. “She makes $175,000 a year and wants the tax payer to assume her debts? No, pay your bills you deadbeat. Student loan forgiveness is upper class welfare.”
“Half of all student debt is held by people with graduate degrees,” he continued. “The idea that this is some kind of persecuted class of people who deserve tax funded debt forgiveness is absurd.”