Senator Has Been Fighting for Student Debt Relief, Urging President Biden to Use Executive Action to Cancel Up to $50,000 in Federal Student Loan Debt Immediately
WASHINGTON, D.C. – April 19, 2021 – Today, U.S. Sen. Sherrod Brown (D-OH) hosted a virtual roundtable with students and education leaders from Ohio colleges and universities to discuss the student loan crisis and his work to support the more than 43 million people in the United States that are buried under $1.6 trillion in student loan debt. During the roundtable, Brown heard from students and leaders from the Ohio Student Association, Central State University, University of Cincinnati, Kent State University, Case Western Reserve University, Cleveland State University and Wright State University about their experiences during the pandemic and what student debt cancellation would mean for them.
“The past year has been challenging for everyone, and I know how hard it’s been for students – with online classes, job disruptions, family health worries, and concerns about your futures,” Brown said during the roundtable. “Even before the pandemic, student loan debt was already crushing for so many – it’s preventing people from starting families and buying homes, and we know Black and brown students are more likely to be struggling with debt, through no fault of your own. The system is broken, and this will only get worse and drain our economy if we don’t act now. That means debt cancellation, and it also means reforming the system for the future.”
In February, Brown joined his colleagues in introducing a bicameral resolution outlining a bold plan for President Biden to tackle the student loan debt crisis by using existing authority under the Higher Education Act to cancel up to $50,000 in student loan debt for federal student loan borrowers. The resolution calls on the President to use executive authority to cancel student loan debt and ensure there is no tax liability for Federal student loan borrowers resulting from administrative debt cancellation.
Today, over 43 million people in the United States are buried under $1.6 trillion in federal student loan debt. Studies show that cancelling student debt would substantially increase Black and Latinx household wealth and help narrow the racial wealth gap, provide immediate relief to millions of Americans during the pandemic and recession, and provide massive consumer-driven stimulus to our economy.
Over 325 civil rights, climate, health, labor, consumer rights, and student organizations have called on President Biden to cancel federal student debt using executive action, including American Federation of Teachers, National Education Association, The Education Trust, Hispanic Federation, NAACP, National Urban League, UnidosUS, League of United Latin American Citizens (LULAC), Minority Veterans of America, National Women’s Law Center, SEIU, the American Psychological Association, Sunrise Movement, the United States Student Association, and Young Invincibles.
Congress has already granted the Secretary of Education the legal authority to broadly cancel student debt under section 432(a) of the Higher Education Act of 1965 (20 U.S.C. 1082(a)), which gives the Secretary the authority to modify, “… compromise, waive, or release any right, title, claim, lien, or demand, however acquired, including any equity or any right of redemption.” The Department of Education has used this authority to implement modest relief for federal student loan borrowers during the COVID-19 pandemic.
Specifically, this resolution:
- Recognizes the Secretary of Education’s broad administrative authority to cancel up to $50,000 in Federal student debt, using the modification and compromise authority Congress has already granted the Secretary in law;
- Calls on President Biden to take executive action to administratively cancel up to $50,000 in Federal student loan debt for Federal student loan borrowers using existing legal authorities under section 432(a) of the Higher Education act of 1965 and any authorities available under the law;
- Encourages President Biden to use the executive’s authority under the Internal Revenue Code of 1986 to prevent administrative debt cancellation from resulting in a tax liability for borrowers;
- Encourages President Biden, in taking such executive action, to ensure that administrative debt cancellation helps close racial wealth gaps and avoids the bulk of federal student debt cancellation benefits accruing to the wealthiest borrowers; and
- Encourages President Biden to continue to pause student loan payments and interest accumulation for Federal student loan borrowers for the entire duration of the COVID-19 pandemic.