WASHINGTON — More than six months after the U.S. Supreme Court struck down President Joe Biden’s ambitious program to wipe out $430 billion in student loan debt, the White House is rolling out smaller, more targeted relief programs that it says will eliminate $132 billion in debt. For more than 3.6 million Americans.
At the time of the court’s ruling, it appeared that Biden would not follow through on one of his biggest promises to the young voters who helped propel him to the White House. But because he went about doing the same thing more slowly, he seems to get less credit from those voters.
On Friday, the administration said it was fast-tracking a key provision of the valuable Education Savings plan — known as SAVINGS — scheduled to take effect this summer. Starting next month, borrowers enrolled in SAVE who have taken out less than $12,000 in loans and have repaid them in at least 10 years will have their remaining debts immediately cancelled. With each additional $1,000 owed, the forgiveness window increases by one year. For example, a student who took out a $13,000 loan will have it cleared now if they have been paying it back for 11 years, or after 12 years for those who borrowed $14,000 – and so on.
Separately, eligible borrowers do not have to wait 10 years to receive some financial benefit from the SAVE plan, which has a more generous formula for calculating income-based payments than previous state programs. Most low-income borrowers will pay less. For example, a borrower earning $38,000 a year with a $25,000 public student loan would see their payments drop from $134 to $43 a month. According to the Department of Education.
The White House said almost seven million borrowers have signed up for SAVE.
“I will not hold back from using every tool at our disposal to give student loan borrowers the flexibility they need to achieve their dreams,” Biden said in a written statement.
Democrats are trying to motivate young voters ahead of the crucial months of the 2024 presidential campaign. According to an NBC News poll in NovemberRepublican front-runner Donald Trump has a slight lead among 18-34 year olds (46% to 42%) — a contrast to past election results and past NBC News polls.
Biden first announced a plan for extensive student debt forgiveness in 2022, before the midterm elections. The following summer, the Supreme Court overturned it, ruling that a president did not have the authority to enact such broad policies under the law.
Since then, the White House has used other tools that no other president has used to this extent. For example, using anti-fraud and consumer protection rules, the administration forgave $22.5 billion from more than 1.3 million borrowers who claimed they had been defrauded by their schools or that their schools had closed.
Now the administration is ramping up its efforts to get that to voters. In South Carolina, some Democratic voters NBC News spoke to said they were disappointed with the Biden administration, citing what they perceived as a lack of results on student loan forgiveness as one of the reasons.
“I feel like my generation, we were promised student loan relief and it didn’t happen,” said Nashonda Hunter, 41. the many Americans who suffer.”
That comment, albeit anecdotal, reveals some of the challenges facing the Biden campaign: getting voters to give the president credit for the policies he’s focused on.
Some Biden staffers are disappointed that the president’s efforts to reduce student debt have not been given more attention. Last week, Rep. Jim Clyburn, D-C., introduced Biden at Mother Emanuel Church and highlighted the administration’s efforts to renew the loan assistance program for public workers such as teachers, police officers, firefighters and federal and state employees.
“But for some strange reason,” Clyburn said, “we don’t see reports of that.”
Diane Stuckey Bruce, who works at South Carolina State University, said she has been paying off student loans since 2002 and has never missed a payment. But the debt was crushing and did not allow him to buy a house.
Then, in late 2021, he said all remaining student loan debt — $263,585.35 — was forgiven through a program known as Public Service Loan Forgiveness (PSLF).
“I will never forget that day for the rest of my life,” he said, calling it a game changer. “It was the greatest blessing I ever received.”
The White House said it received notes from voters who were grateful for the loan relief.
“I actually sat down and cried,” said one writer who worried they would have to refinance their home to pay off the debt. “I am so relieved and my heart is filled with gratitude.”
Still, while debt relief programs are popular on the political left, many Republicans have spoken out against them, praising the Supreme Court for striking down the administration’s debt relief plan, arguing it was unfair to the people who paid for it. Their debt to subsidize others who don’t use their tax dollars. GOP presidential candidates have been vocal about the issue for the past year.
“Why should a truck driver pay for someone with a degree in zombie studies?” Florida Governor Ron DeSantis said at an event in Iowa in August. “It doesn’t make sense.”
Republicans on Friday criticized the White House and the Department of Education for a debt relief plan they say is too expensive.
“President Biden is clearly desperate for votes before the election — so much so that he’s giving the Department of Education the green light to pour more kerosene on the already raging student debt fire,” said the Republican chairman of the House Education Committee, Virginia. North Carolina Foxx, after Friday’s announcement. “It’s clear that the Biden administration needs some good old fiscal common sense — all it knows how to do is spend like a drunken sailor.”