Consumer Groups Applaud Effort to Cancel $50,000 in Student Loan Debt
Even as President Joe Biden has suggested cancelling at least $10,000 in student loan debt per person as part of a COVID-related relief package, some Democrats are calling for a much larger measure.
Amid an announcement today that a group of Democratic lawmakers in the House and Senate, including Senator Elizabeth Warren and Rep. Ayanna Pressley, have a plan for cancelling up to $50,000 in student loan debt, consumer groups from around the country announced support for the larger measure.
The 50 state and national groups issued a joint statement encouraging Biden to adopt the $50,000 target:
We applaud Majority Leader Chuck Schumer, Senator Elizabeth Warren; Representatives Pressley, Adams, Bowman, Jones, Omar, and Torres; and Chairwoman Waters for their bicameral resolution urging President Biden to take executive action to cancel up to $50,000 in federal student loan debt using legal authorities already granted by Congress. Cancelling student debt will provide both immediate financial relief to millions of Americans and crucial economic stimulus for everyone during this protracted crisis. This action would also boost GDP and job creation at a time of intense labor shocks and economic uncertainty.
The groups pointed to a recent letter signed by more than 330 advocacy groups nationwide and sent to the Biden Administration that indicated the benefits of cancelling student loan debt. Those benefits include:
- Student debt exacerbates existing racial inequities; cancellation will help reduce the racial wealth gap. Black Americans — and particularly Black women — are more likely to take on student loan debt and struggle with repayment.
- Cancellation will provide a much-needed economic stimulus. Research shows that student debt cancellation catalyzes drastic, positive changes for borrowers, particularly for those not current on their loans.
- Federal student debt cancellation could have a positive impact on health outcomes. Debt is associated with negative mental and physical health outcomes such as stress, depression, worse self-reported general health, higher diastolic blood pressure, obesity, and even mortality. Research has also shown a connection between debt and foregone medical care.
For more on issues impacting consumers, follow Andy Spears