Trump's Executive Order on Federal Student Loans Could Give Biden Trouble
Biden on student loans, Jeffrey Czum via Pexels
Secretary of Education Betsy DeVos officially implemented measures that will extend the deferment of federal student loans via the CARES Act. The extension not only pauses loan payments on student loans but reduces the interest to 0 percent through December 2020. While the current administration hasn't been strong on the issue of student debt, it could prove a difficult topic for Joe Biden to beat Trump on this November.
Though the student loan relief measures were set to expire at the end of August, President Trump noted that it was “appropriate [to extend the loan relief] ... until such time that the economy has stabilized, schools have reopened, and the crisis brought on by the COVID-19 pandemic has subsided.”
Gage Skidmore via Flickr
Despite the fact that Congress can’t agree on a second stimulus package, the extension of federal student loan relief was vital. Close to 10 million borrowers could be put out of work by the COVID-19 recession. Per the Harvard Business Review, there will be close to $2 trillion worth of student loan debt in the US by 2021.
“If you have less income, your ability to repay student loans will be affected,” higher education professional Mark Kantrowitz told the Review. “The highest priorities for student loan borrowers is to pay for food, medical care, housing and utilities, not repaying their student loans.”
Student loans debt relief impact
Though the debt relief ensures that millions of Americans won’t have to endure both a fledgling economy as well as monstrous payments on student loans, it does nothing for the nine million borrowers struggling to pay back private loans. House Democrats moved to cancel up to $10,000 of debt for some borrowers of private and federal student loans. Conversely, Senate Republicans fired back with their own bill that provided virtually no relief for borrowers and eliminated deferment for everyone with an income above $0.
Karolina Grabowska via Pexels
Despite the fact that temporarily abating the looming crisis on student loans with an executive order isn’t ideal, the President insists that the administration will “most likely,” extend the federal student loan relief into 2021. Given the gridlock in Congress right now, even flirting with the promise of a longer relief period seems like a lot to offer. But, Trump might not even be president by the time the current extension expires.
Joe Biden on student loans
This could be his play to curry favor with debt stricken voters before he runs against a Democratic electorate itching for some relief on student loans. It's not like the Republican base has a totally ludicrous understanding of the student debt burden. Enough of them want change on that front to make a difference. Joe Biden recently announced that he would forgive all undergraduate tuition for graduates of two and four year public universities, less fortunate borrowers, and those who graduate from HBCUs.
Neither Biden or Trump have any plans to cancel the debt —certainly not forever— and American elections are flavor-of-the-week. Remember how Hillary Clinton was gonna beat Donald Trump in the 2016 general election? Right up until she didn't. How candidates frame what they're doing and saying now, and how they justify what they actually did later is where the real political currency is.
The present wins elections.
In this sense, one could say that when it comes to the issue of student loans and college debt, both candidates are on equal footing, at least the way it looks right now. Neither of them will do anything too radical. But, Trump is more willing to dangle the debt relief carrot in everyone's face because he actually can. He gets to run on this issue in the now but Biden has to run on this issue with promises about the future and musings about the past.
Trump is the sitting president. If Biden doesn't push himself further left on this issue, Trump could just lambast him in the present while making vague (and seemingly more actionable) promises about extending student debt relief into 2021, whether he does or doesn't actually do it.
*Article by Raz Robinson, journalist and freelance writer, based in New York City. Connect with him on LinkedIn, follow him on Twitter @razrobinson or send an email to Rrob0904 (at) gmail (dot) com.