President Joe Biden on Thursday said an additional $4.5 billion in student debt is being canceled for about 60,000 teachers, nurses, firefighters and others, bringing the number of public service workers to get relief during his administration to more than 1 million.
More than $73 billion in loans have been forgiven under a 2007 initiative, according to an Education Department news release. Borrowers eligible for the latest round of relief should learn of their debt being cleared in coming weeks.Â
The borrowers getting relieved of debt are benefitting from reforms to the government’s Public Service Loan Forgiveness program. The PSLF program, signed into law by President George W. Bush in 2007, lets certain not-for-profit and government employees have their federal student loans canceled after 10 years of monthly payments. The Consumer Financial Protection Bureau in 2013 estimated that a quarter of American workers might be eligible.Â
Less than 10,000 people received the relief intended by the program, which has been plagued by poor management and low acceptance rates.
The program “was so riddled by dysfunction that just 7,000 Americans ever qualified and countless public servants were trapped making payments on debts that should have been forgiven,” U.S. Secretary of Education Miguel Cardona said in a statement. “I want to send a message to college students across America that pursuing a career in public service is not only a noble calling but a reliable pathway to becoming debt-free within a decade.”
Helping those saddled with student debt was a main promise made by President Joe Biden in his 2020 campaign. But his efforts have been stymied by opposition including legal challenges, with the Supreme Court in 2023 voting 6-3 against Biden’s plan to erase the student debt of more than 40 million people. An alternative proposal is currently being blocked by a recent federal court ruling and a separate initiative called the “SAVE plan” was also temporarily blocked by a federal appeals court.Â
The outcome of the November presidential election could determine whether such programs survive, as the next administration would have the option of defending or ending the efforts, with Vice President and Democratic nominee Kamala Harris vowing to do the former.Â
Critics of the moves to forgive student debt include Republican nominee and former President Donald Trump. While in the White House, Trump’s 2020 budget proposal called for eliminating the loan forgiveness program for public employees.
