On Wednesday, February 21st, President Joe Biden declared an extension of his student loan forgiveness initiative, which will cancel the loans of an additional 150,000 Americans, amounting to $1.2 billion. This announcement targets Biden's constituency of young voters who heavily supported him in the 2020 presidential election.
Biden stated, "Although a college degree remains a pathway to a better life, its cost is prohibitive, leaving many Americans burdened with unsustainable debt in exchange for education." However, it's important to note that this debt relief is restricted to individuals enrolled in a specific repayment plan who meet specific criteria.
The loan forgiveness applies to participants of the voluntary Saving on a Valuable Education (Save) repayment plan who have consistently made payments for at least ten years. Additionally, only those who initially borrowed $12,000 or less for their education are eligible for exemption under this program.
According to the Department of Education, approximately 7.5 million individuals are enrolled in this repayment program, established by the Biden administration. Despite initially scheduled for implementation in July, the debt relief program commenced ahead of schedule in February, as announced by the Biden administration last month. Experts view this initiative as an attempt by Biden to boost his declining approval ratings in the lead-up to the presidential race.
In response to this new policy, Biden's campaign released a statement from Maxwell Frost, the youngest member of the US Congress representing Generation Z. Frost emphasized the disparity between Biden's approach to student debt compared to that of former President Trump, who, according to Frost, impeded efforts to assist struggling borrowers.
Since its initial announcement, Republicans have criticized the program, deeming it a misuse of government funds that could be allocated more effectively. Nevertheless, Biden remains committed to fulfilling his campaign promise, resulting in the cancellation of nearly $138 billion in federal student loan debt for almost four million borrowers.
