Rep. Alexandria Ocasio-Cortez (D-NY) is firing back at President Joe Biden Wednesday after Biden rejected a progressive proposal to cancel $50,000 in student loan debt by executive order.
The public disagreement marks the first time Ocasio-Cortez has publicly criticized Biden, despite making clear efforts at distancing herself from the more “moderate” Democratic president while he was still on the presidential campaign trail.
Biden was adamant, at a town hall-style appearance Tuesday night, that, despite efforts to help ease the financial burden on workers suffering from extended coronavirus-related lockdowns, he would not sign on to a plan to forgive $50,000 in student loan debt per borrower through executive order, despite promising some student loan relief.
“I will not make that happen,” Biden said, pointedly, in response to a question about student loan forgiveness.
“My point is: I understand the impact of debt, and it can be debilitating,” Biden said, noting that his children were among those who incurred hundreds of thousands in student debt from undergraduate and graduate studies. “I am prepared to write off the $10,000 debt but not fifty because I don’t think I have the authority to do it.”
Ocasio-Cortez slammed Biden on social media late Tuesday, insisting that he has the power to make student loan debt disappear.
“The case against student loan forgiveness is looking shakier by the day,” Ocasio-Cortez tweeted. “We’ve got the *Senate Majority Leader* on board to forgive $50k. Biden’s holding back, but many of the arguments against it just don’t hold water on close inspection. We can and should do it. Keep pushing!”
She also struck back at Biden’s comments, made Tuesday, that student loan forgiveness packages will likely bypass graduates of elite and Ivy League universities, given those graduates’ earning potential.
“Who cares what school someone went to? Entire generations of working-class kids were encouraged to go into more debt under the guise of elitism,” Ocasio-Cortez said. “This is wrong. Nowhere does it say we must trade-off early childhood education for student loan forgiveness. We can have both.”
Ocasio-Cortez and others, like Sen. Elizabeth Warren, want Biden to use executive authority ceded to him under the Higher Education Act. But Biden’s administration has maintained that his ability to change the terms of student loans is limited if he’s using executive orders to handle the issue. “On the campaign trail, now President Joe Biden had promised to forgive $10,000 of the loans for all borrowers,” CNBC noted.
If Ocasio-Cortez and others want to forgive more, the White House has said, they will have to author and pass a bill.
But Fox News points out that forgiving student loan debt is a costly effort that may not produce much in the way of a benefit to the American economy, and any student loan forgiveness program would disproportionately help higher-income Americans.
“A recent working paper published by the University of Chicago’s Becker Friedman Institute for Economics shows that erasing all student loan debt would distribute $192 billion to the top 20% of earners in the U.S., but just $29 billion to the bottom 20% of U.S. households,” Fox News noted. “Erasing student loan debt would also add to the nation’s already-ballooning national deficit, which totaled a record $3.1 trillion for the 2020 fiscal year — not including the $900 billion coronavirus relief legislation that lawmakers approved in December.”
Regardless, student loan debt remains a problem for many Americans. Outstanding student loan debt now totals nearly $2 trillion.