Two individuals with knowledge of the situation predict that President Biden will announce student debt relief on Wednesday.
However, it’s not yet clear what the president will really say. One possibility, according to a person involved with the conversations, is to forgive $10,000 in student loan debt for students earning up to $125,000.
The announcement by Mr. Biden’s timing was originally reported by NBC News.
It’s also conceivable that the government may just continue to postpone student loan payments for the time being and keep quiet about any debt cancellation plans.
According to sources, the president is still on track to decide by August 31 as he promised.
According to a Penn Wharton Budget Model estimate, it would need approximately $300 billion in the first year to forgive $10,000 in student loan debt for anyone earning up to $125,000 a year.
It also discovered that Americans in the top 60% of earnings would benefit from more than two-thirds of the debt forgiveness.
Low-income Critics of student debt cancellation point out that Americans who never went to college and are suffering financially in the midst of record-high inflation would not gain from any loan cancellation. Eradicating some student loan debt wouldn’t solve the problem of growing education costs, which have generally risen faster than inflation in recent decades.
The suspension of student loan repayments started under the Trump administration at the start of the epidemic, and since Mr. Biden assumed office, it has been suspended a total of four times.
After August 31, when the present suspension expires, debtors will have to start paying back their loan once again if there isn’t another extension.