fb-pixel Skip to main content

Biden considers new pause on paying back student loans, $10,000 relief

President Joe Biden at the White House in Washington, June 21, 2022.Haiyun Jiang/NYT

President Joe Biden is considering extending a pause on student loan repayments for several more months, as well as forgiving $10,000 in student loan debt per borrower, according to people familiar with the matter, as he seeks to appeal to young voters ahead of the November midterms.

The current moratorium on student loan payments expires Aug. 31, and a fresh pause could extend either through the end of 2022 or until next summer, the people said. Biden told reporters last week that he hoped to decide on an extension by the end of August.

Debt forgiveness may follow the extension, but the president hasn’t reached a final decision on either move, the people said. Biden has been weighing appeals from progressives to forgive large amounts of student loan debt almost since entering office, and the extended deliberations have frustrated some advocates.

Advertisement



The people asked not to be identified discussing internal White House deliberations. A White House spokesman said Biden and his team are still assessing their options and no decision has been made.

It’s unclear if the approach will appease civil rights organizations like the NAACP, progressive Democratic lawmakers and a swathe of powerful labor unions that have pressed Biden to forgive $50,000 per borrower. The plan is intended to appeal to voters under age 30, whose enthusiasm -- or lack thereof -- in November could be key to determining whether Democrats retain control of the House and Senate.

The president is intent on ensuring any student loan forgiveness doesn’t benefit high-income people, so the administration is likely to cap eligibility somewhere between $125,000 and $150,000 in annual income, one of the people said.

Biden has neared a decision on student loan forgiveness at least three times in the last several months, according to one Democrat close to the White House. Yet concerns about escalated inflation have complicated the discussions, preventing Biden and his top aides from moving forward with an announcement.

Advertisement



Although Biden’s top economic aides have argued student loan forgiveness will not fuel inflation, White House officials have been reluctant to hand Republicans any additional talking points. The opposition party has sought to portray the administration as flooding the economy with money and thereby adding to inflationary pressure.

©2022 Bloomberg L.P.