No decision on student loan forgiveness: WH
Looks like President Biden is breaking his campaign promises to relief Americans from their student loan debt, as the White House denies that the President has taken a decision on the matter.
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US President Joe Biden
The Biden administration is yet to make a final decision on student loan cancellation, a White House spokesperson said Friday following a news report that claimed Washington was planning to cancel $10,000 in student debt per borrower.
A Washington Post report cited individuals familiar with the plan, two of whom said the $10,000 debt forgiveness would apply to US nationals who earned less than $150,000 in the previous year or less than $300,000 for married couples filing jointly.
White House spokesperson Vedant Patel said the report was inaccurate. "No decisions have been made yet. But as a reminder, no one has been required to pay a single dime of student loans since the president took office," he told Reuters.
A study conducted by New York Federal Reserve economists concluded that forgiving $10,000 per student would amount to $321 billion of federal student loans and eliminate the entire balance for 11.8 million borrowers, 31% of US borrowers.
"Administration actions have already provided more than $18.5 billion in targeted debt relief to more than 750,000 borrowers. Not to mention tens of billions more saved by the 41 million borrowers who have benefited from the extended student loan payment pause," Patel added.
Canceling student debt has split Congress, with Democrats calling for it to relieve the young population from some of its debts and Republicans stressing that it would heighten the country's inflation.
The Biden administration has shown a lot of reluctance toward unilaterally making an unprecedented cancellation of college debts who would go back to Washington. This would put Biden's legal authority under the microscope and allow everyone to see if he was able to carry out such action.
So that his legal authority is not tested, Biden asked Congress to pass a bill forgiving debt that he could sign.
Despite the loaning business being heavily lucrative for Washington, the federal government has let 43 million borrowers stop paying a total of $1.6 trillion in student debt since the Covid-19 pandemic took the world by storm in 2020.
This is still ongoing though the United States has been hit with record inflation at rates that have not occurred in decades.
A consumer server conducted by the University of Michigan (UMich) said US consumer sentiment is nearing March lows once again in light of surging inflation exacerbated by the Ukraine war, which is heavily affecting the buying decisions of Americans.
The final May reading for UMich's Consumer Sentiment Index was 58.4, a steep decrease from April's 65.2 and a slight one from March's level of 59.4.
The actions taken by the West against Russia, from sanctions to bans on trade, have gravely stunted the economy and global trade, all in all, causing several crises and sparking concerns over a worldwide food shortage.
