“Several members on the other side of the aisle called on the Biden administration to write off $ 10,000 to $ 50,000 student loan debt — a dubious idea.” Chuck Grassley (R-IA) said during a Senate meeting Judicial Committee Hearing on student loan debt and bankruptcy on Tuesday.
Grassley, a senior committee member and 40-year veteran of the Senate, added that the Biden administration “also lacks the authority to do so, not even the Speaker of the House of Representatives. [Nancy] Pelosi herself recently said, and I want to quote, “The President cannot do this.” So it’s not even a discussion. ”
Pelosi’s comments, made during last week’s weekly press conference, are at odds with what other prominent Democrats have pushed President Joe Biden into through the decree.
“People think the President of the United States has the right to forgive debts, but he does not,” Pelosi said during her weekly press conference. “He can procrastinate, he can postpone, but he has no such power. It must be an act of Congress. “
Senate Majority Leader Chuck Schumer (New York State) and Senator Elizabeth Warren (Massachusetts) repeatedly called on Biden uses executive power to make student loan forgiveness for approximately 45 million public debt borrowers.
“President Biden May Cancel This [student] debt – can forgive $ 50,000 of debt – on the very first day he becomes president. “- Schumer, NY said in December 2020… “You don’t need Congress. All you need is a slight movement of the handle. “
“Moral Hazard” of Student Loan Forgiveness: Grassley
One of the Biden campaign promises involved cancellation of outstanding student loans in the amount of US $ 10,000 for all borrowers.
However, the president skeptical enacting large-scale cancellation of student loan debt of up to $ 50,000 through enforcement action (as opposed to legislation passed by Congress).
The main argument of the president for the possibility of writing off student debt through executive measures, since detailed The Harvard Law School Legal Services Center, in a letter to Senator Warren, states that the Secretary of Education has the power to “cancel existing student loan debt in accordance with certain statutory powers – the power to modify existing loans specified in 20 USC § 1082 (a) (4)… “
At a hearing on Tuesday, Grassley explained his general opposition to canceling student debt.
“We have to consider the moral hazard and the cost of taxpayers,” Grassley said, adding later: “I don’t think we should ask those who did not go to college to pay for those who did. Therefore, I urge colleagues to examine all the factors causing high levels of debt in higher education and carefully examine the costs associated with any reform. ”
Aarti is a correspondent for Yahoo Finance. She can be contacted at firstname.lastname@example.org. Follow her on Twitter @aarthiswami…