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Takeaways from the Key Notes
- President Joe Biden's administration has scrapped a proposal to provide student debt relief to borrowers who experienced financial hardships.
- The Department of Education said that this withdrawal was caused by timing, and administration has the right to give relief.
- Before Donald Trump, a possible president-elect of the United States, enters into office in Washington D.C.
President Joe Biden's administration withdrew a proposal to provide student debt relief to borrowers nearly 8 million borrowers.
The original proposal announced in October would have forgiven student loan debts for borrowers with extensive medical expenses, high child-care costs, large family-care expenses, or financial hardship due to a natural catastrophe.
The Department of Education announced that it would withdraw the proposal as the Administration wants to concentrate on other priorities in the time remaining before Donald Trump becomes president. One of these priorities was to help borrowers who were still in the transition period after the end of the pandemic.
The department, however, insisted that it was authorized to provide student loan relief for borrowers who were unable to pay their debts due to hardships. Whether the president's administration can unilaterally forgive student debt without congressional approval has been a point of contention in a number of legal challenges to Biden's student loan relief programs.
This withdrawal was part of a larger initiative by the Biden administration to tie up its loose ends before a potential government shutdown and President-elect Donald Trump’s inauguration. The administration also forgave $4.28 billion in student loans for public service workers Friday.
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