If before the American dream was to own a house with a white palisade, now it is paying off its debts. For many, the humble pursuit of zero debt seems out of reach. Over the course of his long career, Mr. Biden has contributed to this crisis by working to strengthen the hands of lenders, including through the 2005 bankruptcy reform bill that abolished borrower protection.
It’s time to make amends. If the Biden administration is serious about Better Recovery, they need to take bold action. This country cannot afford to allow millions of needy families to drown when, after the suspension of payments and the end of the moratorium on evictions, a mountain of old bills and rent returns are suddenly due. The government can and should find ways to make the overwhelming debt disappear.
Student loans, medical debts, utility bills, fines and criminal justice fees, and municipal debt all need to be written off or canceled altogether. I written in the other place some of the various legal means by which this can be achieved, and there are many other potential strategies.
For starters, President Biden must deliver on his campaign promise to Congress to “immediately” write off student debt to borrowers. There is no reason to hold back. Erasing every penny of federal student debt would improve the lives of nearly 45 million people, help narrow the racial wealth gap, and probably win over large numbers of Republican voters ahead of the midterm elections. Debt Collective, the debtor affiliate I helped find, is already prepared a resolution the president can sign it tomorrow – no need to involve Congress or pass legislation.
Then he should deal with medical debts. Following Senator Bernie Sanders’ proposal, Democrats could write off all medical collection debts, including fees incurred due to Covid. (At the very least, legislators should protect borrowers by making sure that overdue hospital bills are not listed on credit ratings and make it more difficult for collectors to come to patients.)
Finally, elected officials must also relieve tenants of the huge burden they face by clearing accumulated rental arrears, preferably in a way that will not just bail out, but further enrich and empower landlords. Passing the Mortgage Lease and Cancellation Act, presented by Minnesota Representative Ilhan Omar, would be a good start.
These ideas do not go beyond the mainstream. More than 415 organizations, including America’s Minority Veterans, the National Coalition of Young Farmers and the NAACP, have signed letter urging the Biden administration to use executive powers to write off student debt. In the early days of the pandemic, the Poor People’s Campaign, a group for racial and economic justice, introduced Anniversary platformand he recently partnered with progressive legislators in Congress on “Third resolution on reconstruction, ”Debt relief is noticeable in both cases.