The Department of Education estimates that around 8 million American citizens could benefit from the cancellation of student loans. Miguel Cardona, the Secretary of Education, expressed his concern about the financial difficulties many borrowers are facing and the lack of access to the necessary aid. Eligible individuals include those with unexpected medical expenses, high child care costs, family members with chronic illnesses, or financial hardships stemming from natural disasters.
In contrast, Republican Congresswoman Virginia Foxx labeled the proposal as a "fake plan" designed to attract voters ahead of the presidential elections. Foxx vigorously criticized the initiative, arguing that the government wasted the opportunity to implement significant and lasting reform regarding college costs.
The proposed credit cancellation by the Biden administration, like previous ones, could face legal challenges from conservatives who consider these proposals unconstitutional and unfair. The new rule will allow the Department of Education to proactively cancel loans for borrowers if they are determined to have a high likelihood of defaulting in the next two years.
This new strategy from the Biden administration aims to assist those borrowers who may never be able to repay their student debt. Despite the obstacles this rule must overcome before being approved, uncertainty looms over whether the process can be completed before Biden's term ends in three months.
