Joe Biden announces partial cancellation of student debt

Joe Biden announces partial cancellation of student debt

US President Joe Biden enjoyed a walkabout when he returned to the White House on Wednesday, August 24, 2022, after a summer vacation in Delaware with his family.

US President Joe Biden on Wednesday announced a partial forgiveness of student loans, an issue that is hotly debated in a country where a year of college can cost tens of thousands of dollars.

In keeping with my campaign promise, my administration is announcing a plan to give working-class and middle-class families a break as they prepare to resume federal student loan repayments in January 2023, Mr. Biden, promising details in the afternoon.

The measure, announced less than three months before the midterm elections, affects people earning less than 125 $10,000 a year, according to an illustration accompanying the president's tweet.

It will be clearing $10,000 for people who did not benefit a federal scholarship to pay the costs of their university studies, and $20,000 for those of more modest means who have received one.

The plan was announced after months of reflection at the White House on this issue, which has also been a headache for previous administrations. The executive was particularly concerned about the possibility that the measure would fuel already galloping inflation.

Democratic senators Chuck Schumer and Elizabeth Warren hailed in a joint statement a giant leap towards solving the student debt crisis.

Republican Party Leader Ronna McDaniel instead said the measure unfairly punished Americans who saved up for college or made a different career choice.

The American universities can charge $10,000 to $70,000 a year, and many students begin their working lives with heavy debt.

According to government estimates, debt average for American students when they graduate is $25,000, a sum that many take years or even decades to repay.

In total, some 45 million borrowers nationwide collectively owe $1.6 trillion, according to the White House.

Mr. Biden also announced that a moratorium on student loan repayments, instituted during the COVID-19 pandemic, would be extended through the end of the year.

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