US President Joe Biden’s administration announced that 125,000 people will have $9 billion in student loan debt canceled.
In a written statement from the White House, it was noted that Biden approved the write-off of $ 9 billion in student loans of 125 thousand Americans under the student loan forgiveness policy.
To date, the Biden administration has forgiven a total of $127 billion in loans for about 3.6 million Americans.
In the US, where university education is expensive, many people take out student loans in order to attend university. Repaying loans after graduation is a serious financial burden for students who study with loans.
Supreme Court overturns Biden’s pardon
On August 24, 2022, US President Biden announced that they were postponing student loan repayments for the last time until December 31 and that they would forgive up to $ 20,000 in debts of people with an annual income of less than $ 125,000.
However, Biden’s student loan forgiveness program was blocked by the Texas Federal District Court on November 11, 2022.
Texas Federal District Judge Mark Pittman ruled that Biden’s $20,000 per person forgiveness of student loan debtors was an “unconstitutional exercise of Congress’ legislative power.”
The Biden administration argued that it had such a right under the Higher Education Amnesty Act approved by Congress in 2003, and the case was brought to the Supreme Court by Republican states.
In June, the Supreme Court overturned Biden’s decision by 6 votes to 3, ruling that last year’s $430 billion student debt cancellation or reduction amnesty was unconstitutional.
Amnesty statement from Biden
Biden said in a statement after the ruling that the amnesty plan could be a lifesaver for millions of Americans affected by the Covid-19 pandemic and that he believed the court’s decision was “wrong”.
“This will give Americans the opportunity to get rid of the burden of their debt and plan for their future,” Biden said in a statement today, stating that the cancellation of student loans will bring “justice and opportunity.”
Who is covered by the amnesty?
In a statement made by the White House, it was noted that the people included in the scope of amnesty are those who were received after 2007 and have an annual income of less than 125 thousand dollars.
The statement said that those covered by the amnesty may have paid off all or part of their loans, but those who are still in arrears can also benefit from the amnesty.
Effects of amnesty
For millions of Americans, student loan forgiveness means relief from a significant financial burden.
The amnesty offers an important opportunity, especially for people from low-income families who receive student loans for higher education.
Amnesty could also contribute positively to the economy. Writing off student loans could help people spend more and stimulate the economy. (AA)
