Struggling 2020 candidate Elizabeth Warren has proposed cancelling up to $50k in student debt on day 1 of her Presidency, bypassing congress altogether and directing the Secretary fo Education.
Per Bloomberg, Warren said that as president, she would not wait for Congress to approve her plans to cancel or modify federal student debt. Instead, she would directly authorize the Department of Education to provide as much as $50,000 in relief to about 95% of student loan borrowers.
She has said she would relieve $640 billion of student debt, a pledge that would be funded by her proposed tax on wealth for households with assets of more than $50 million. That, however, depends on the wealth tax passing Congress, which would take longer and might be difficult.
USAToday reports Sen. Elizabeth Warren would capitalize on the federal government’s current legal authority and begin canceling existing student loan debt on her hypothetical first day in office.
In a plan released Tuesday, Warren said she would direct the Secretary of Education to “use their authority to begin to compromise and modify federal student loans consistent with my plan to cancel up to $50,000 in debt for 95% of student loan borrowers,” which equals about 42 million people.
“We’re facing a student loan crisis — one that’s holding back our economy and crushing millions of American families,” Warren said in a release, adding she previously introduced a plan that would “broadly cancel student loan debt, provide universal tuition free public two- and four-year college and technical school, ban for-profit colleges from receiving federal aid, and help end racial disparities in college enrollment and resources.”
“But the Department of Education already has broad legal authority to cancel student debt, and we can’t afford to wait for Congress to act,” she said.
As of March 2019, there is a total of $1.6 trillion in federal and private student loan debt that borrowers owe. More than $1.4 trillion is in federal student loan debt.
Warren last year introduced a proposal that would eliminate up to $50,000 in student loan debt for every indebted person with a household income of less than $100,000. Under her plan, borrowers who make $100,000 and $250,000 would also be eligible to have a smaller portion of their debt forgiven.