In just under six weeks, the nearly 46 million people who have not had to make payment on their federal student loans since the coronavirus pandemic broke out in March 2020 will have to pull out their checkbooks and start paying back debt.
Unless the White House extends the moratorium again. Or just decide to pay off a large chunk of the $1.75 trillion in student loan debt that’s currently on the books.
The pause in student loan payments and interest accrual began when President Donald Trump signed the CARES Act into law in late March 2020. Later in his tenure, Trump extended the payments moratorium two more times, and since Joe Biden took over the presidency, he has done the same three times. However, the current pause will expire soon, and payments will resume on May 1st.
Lately Ron Klain, Biden’s chief of staff, has suggested that Biden could either delay the hiatus until the end of this year or even consider forgiving some of the student loan debt. How much that could be remains unknown, although Biden has previously said he would like to erase $10,000 per borrower. However, some Democrats, including Senate Majority Leader Chuck Schumer of New York and Senator Elizabeth Warren of Massachusetts, have continued to urge Biden to eliminate $50,000 per borrower.
While it’s possible to make a case for eliminating the lesser amount, the thought of simply magically waving away up to $50,000 per borrower is unfair on many levels. It’s unfair to those who have dutifully worked to pay off their student loans. It’s unfair to those who never went to college but are now being asked as taxpayers to foot the bill for those who did. Imagine a contractor who had to buy an expensive truck—and a truckload of equipment and tools—and went into deep debt to do so. I’m sure he would also like to see the FBI take care of his debts.
The payment pause was initially introduced as an emergency measure because of the pandemic. That was only reasonable. Shops were closed. People have been instructed to stay at home. But no one can rationally argue that we still need to be in emergency mode.
The loan disbursement pause is scheduled to end on May 1st as planned.