New Student Loan Pause Expected, But Critics Urge White House To Take More Concrete Action

A fifth extension on deferred student loan payments since the payment moratorium began at the onset of the cOVID-19 pandemic in March 2020 is expected to be announced by the White House on Wednesday, but critics are still calling for more permanent action to relieve borrowers of their burden as the debt crisis continues to soar.

Bloomberg reports that the White House is expected to extend the pause on student loans, which currently allows borrowers to avoid making payments and accrue no interest, until August 31, as the government continues struggling with figuring out how to deal with the crippling student loan crisis—something President Joe Biden promised to handle while campaigning.

With debt soaring into the trillions, critics have long called for the White House to cancel all student debt, something the President has maintained he does not have the authority to do.

However, others are calling for a more targeted approach that only cancels debt for certain people or aspects of the population, such as teachers, doctors, and/or those of lower socioeconomic status. A total cancellation would eliminate payments for all borrowers, even those who are likely to be able to pay off their debt within their lifetimes.

As the pause continues, Progressive Democrats are calling for either a cancellation of all student debt or cancel up to $50,000 of debt per person, while more moderates and Republicans favor either a more targeted approach or no forgiveness at all. The current administration and state leaders have canceled millions in debt, though it stands nowhere near the amount that would be considered a true easement of the debt crisis.

The last extension on the moratorium had payments scheduled to resume on May 1.

Given the current political climate, a bill to cancel debt would likely pass the House only to be stopped in the Senate. Biden could sign an executive order, but that would leave the administration open to more legal challenges.

So far, the administration has been unable to make a decision on how it wants to proceed given the political and economic climates.