WASHINGTON, D.C. – U.S. Senator Sherrod Brown (D-OH) joined Chuck Schumer (D-NY) and Elizabeth Warren (D-MA) in introducing a resolution outlining a bold plan for the next President of the United States to use existing authority under the Higher Education Act to cancel up to $50,000 in Federal student loan debt for Federal student loan borrowers. The resolution outlines how the President should 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. Donald Trump and Republicans in Congress refuse to provide any immediate student debt cancellation for tens of millions of Americans, but Democrats will be ready to act starting in 2021. Joining the resolution are Richard J. Durbin (D-IL), Bernard Sanders (I-VT), Tammy Duckworth (D-IL), Richard Blumenthal (D-CT), Chris Van Hollen (D-MD), Jeff Merkley (D-OR), Edward J. Markey (D-MA), and Cory Booker (D-NJ), Robert Menendez (D-NJ), and Ron Wyden (D-OR).
“Even before the pandemic, student loan debt in this country was already crushing for many, preventing people from starting families, purchasing homes, pursuing professions, and fully participating in the economy,” said Senator Brown. “The President has the ability to cancel student loan debt, and this resolution details how up to $50,000 can be cancelled under authority granted in the Higher Education Act. Student loan debt cancellation can provide immediate relief to families who are facing economic hardship, help close the racial wealth gap, and stimulate the American economy for millions of people. This is especially important as families – particularly Black and brown households, who are disproportionately affected by these issues – are navigating the public health and financial crisis of the pandemic. It is past time for us to act.”
Studies show that student debt cancellation can substantially increase Black and Latinx household wealth and help close the racial wealth gap, provide immediate relief to millions who are struggling during this pandemic and recession, and give a boost to our struggling economy through a consumer-driven economic stimulus that can result in greater home-buying rates and housing stability, higher college completion rates, and greater small business formation. Over 100 community, civil rights, consumer, and student advocacy organizations have already come out in support of using executive authority to cancel student loan debt.
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 grants 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 reportedly used this authority to implement modest relief for federal student loan borrowers during the COVID–19 pandemic.
“Before the COVID-19 pandemic, millions of Americans were already confronting burdensome student loans, with the national student loan debt at a record $1.5 trillion. Now, as the country confronts sky-high unemployment, and crippling state, school and local budget cuts have further depressed employment prospects, that debt burden is an economic death sentence. Student loan debt is hindering borrowers’ ability to buy homes, pursue certain professions, and participate in any type of future economic recovery. And it has a particularly pernicious impact on communities of color, which have disproportionately experienced its consequences. As the country grapples with unprecedented health, economic and racial crises, our government must do everything it can to ease that burden. Broadly cancelling student loan debt would be a game-changer for millions of people in this country and a lifeline when they desperately need it. Thank you, Sens. Schumer and Warren, for this initiative. It’s time the president steps up to help people and shows some leadership on an issue that truly matters,” said Randi Weingarten, President of American Federation of Teachers
“Communities and families across the nation are feeling firsthand the pain of the economic crisis brought forth by the pandemic. With high levels of unemployment and with working people struggling to make ends meet, we must do everything possible to help families survive. Even before the coronavirus, too many Americans, especially communities of color, faced crippling student loan debt that made it impossible to get ahead in life. The economic crisis has only exacerbated this devastating situation, leaving many choosing between paying their student loan payment or putting food on the table for their family. This is not right. Cancelling student debt will provide some much-needed relief to millions of people who desperately need this lifeline from this massive burden. Educators applaud Sens. Warren and Schumer for their leadership and for putting people first as we address this crisis and help people recover from the economic fallout,” said Becky Pringle, President of National Education Association
In March, Senators Brown, Schumer, Warren, Murray and their colleagues unveiled a proposal to cancel at least $10,000 in student loan debt during the COVID-19 pandemic. Senator Brown is also a cosponsor of the Student Loan Debt Relief Act, a bill Senator Warren introduced with House Majority Whip James E. Clyburn (D-S.C.) to eliminate up to $50,000 in student loan debt for 42 million Americans, including private borrowers.