On Wednesday, President Joe Biden’s administration announced it will extend the moratorium on student loan payments. From a previous January 31, 2022 deadline, Biden will now further extend the suspension of payments to May 1.
Biden Cites Pandemic As Reason For Student Loan Moratorium
The White House pointed to the continued surge of COVID cases as the reason to continue holding off student loan payments.
In a statement, the President said that millions of student loan borrowers continue to cope with the pandemic’s effects. As a result, they will need more time before resuming student loan payments.
Previously, the White House insisted that they have no plans to extend the moratorium for student loan payments beyond January 31.
The federal government told students to brace themselves and get ready to resume payments by February next year.
However, the recent resurgence of coronavirus, especially the Omicron strain, is shifting the narrative. Last Tuesday, White House press secretary Jen Psaki told reporters that Biden has yet to make a decision on issuing another extension.
Democrats Pushed Biden To Extend Student Loan Moratorium
Democrat lawmakers and debt relief advocates rallied around Biden to take action. They intensified efforts to hold off payment resumption when Senator Joe Manchin (D-WV) said he will not support Biden’s Build Back Better act. The prospect of losing potential benefits and expanded tax credits sent Democrats scrambling.
Natalia Abrams, president of the Student Debt Crisis Center, issued a statement. “The Omicron variant is a scary reminder that the pandemic is still a serious concern,” she said. “Americans cannot be crushed by student debt as they shoulder this health and economic crisis,” she added.
Political Suicide To Resume Payments Ahead of Election Year
Political strategists also pointed out that the Democrats stand to lose out if Biden resumes student loan payments this year.
With the midterms looming close, Democrats might commit political suicide by withdrawing relief efforts for Americans hit hard by pandemic.
Meanwhile, Representative Alexandria Ocasio-Cortez, (D-NY) reinforced the idea that Democrats needed to do something.
She tweeted last week that Democrats are “delusional” if they think they can get re-elected without acting on student debt relief.
Continued Extension of Student Loan Moratorium
The student debt moratorium began during the time of then-President Donald Trump. The then-President issued a hold order against student loan payments in March 2020 as part of the CARES Act. Trump also suspended interest rates for roughly 42 million student borrowers.
The initial hold order was effective until September 2020. Since then, Trump extended the provision through January 2021. Upon assuming office, Biden extended the hold until September 30, then extended it again until January 31.
Remove All Student Debt
Apart from student loan relief, advocates also asked for loan forgiveness. They wanted Biden to not just suspend payments, but rather not make them pay anymore.
The advocates initially pushed the President to issue an order wiping away $50,000 from all American students.
Advocates and some Democratic lawmakers have pressured Biden to take executive action to wipe out up to $50,000 in federal student loan debt for all borrowers.
Biden has said that he does not believe he has the authority to cancel student debt unilaterally but that he would support Congress’ passing a bill to cancel $10,000 in debt for each borrower.
Watch the ABC News video reporting that US President Joe Biden extends student loan payment pause until May:
What do you think of Biden’s decision to extend the moratorium on student loan payment? Do you agree that this is a good move?
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