Will Joe Biden Cancel Student Loans In January?

Joe Biden is reportedly considering a trillion-dollar stimulus package for January if he wins the election this November. Will it include student loan forgiveness?

According to Axios, Biden and his economic advisors are looking at the current economic crisis and recognize the need for further federal intervention. Though hesitant to put a price tag on the possible stimulus, they suggested it could be between $1 trillion and $2 trillion, depending on what—if anything—Congress passes before then.

But it is unclear what that stimulus would include. The popular provisions from the CARES Act include stimulus checks, enhanced unemployment benefits, and a student loan repayment pause. Many are wondering if student loan cancellation would part of Biden’s possible package, given that Biden has adopted Senator Elizabeth Warren’s plan to provide $10,000 in student debt forgiveness for every student loan borrower for coronavirus stimulus and relief.

Payments for federally-held student loans have been suspended through the end of the year, but many borrowers are still hoping for further relief. However, based on the cost of student debt cancellation, it is unlikely Biden would include it in a package that is as small as a trillion dollars. Cancelling $10,000 for all student loan borrowers would cost nearly $400 billion – more than another round of stimulus checks for all Americans.

Biden’s “Build Back Better plan includes extending the $600 weekly unemployment benefits and more state aid to ensure educators and school support staff aren’t laid off. If Biden’s goal is to help people get back to work or the continue the enhanced unemployment benefits, it is unlikely he would want to spend 40% of his first bill on something that would just benefit 15% of the population.

However, Biden might extend the repayment and interest pause as that costs significantly less than cancelling debt outright. That would allow Biden to provide other things like stimulus checks, unemployment benefits, and possibly more state and local government aid, while still providing relief to struggling student loan borrowers.

If Biden is elected, he can spend part of the transition period lobbying lawmakers for the first stimulus plan so that it can pass right after he is sworn in to office. Passing a stimulus plan that early could provide a down payment towards his “Build Back Better” plan that would provide even more stimulus if passed.

Related Readings:

Joe Biden And Kamala Harris’s Plan For Student Debt

Senator Warren Announced a New Plan To Cancel Student Debt

Senate Democrats Propose Student Debt Cancellation As Coronavirus Relief

Elizabeth Warren: Cancel Student Debt In The Next Stimulus Package

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