Biden campaigned on cancelling and reforming student debt. Here’s where those promises stand.

Joe Biden
President Joe Biden.

  • Biden campaigned on cancelling $10,000 in student debt per person and reforming loan programs.
  • He has yet to deliver on those promises, but the government has begun work on reforming student debt.
  • Advocates and lawmakers say borrowers need more certainty from the Education Department.
  • See more stories on Insider’s business page.

President Joe Biden promised to lessen the $1.7 trillion student-debt crisis during his campaign, promising debt cancellation and reforms of key student-loan programs.

While it’s admittedly early, Biden hasn’t fulfilled any of those promises yet. The most that can be said is that his is starting to consider working on them, and it’s going to take a while to see progress.

One of the president’s first actions in office was an extension of the student-loan payment pause during the pandemic, providing relief to the 43 million borrowers. But the pause is lifting come October, and borrowers, experts, and lawmakers worry the Biden administration is not doing enough to protect borrowers when that happens.

On Thursday, the Student Borrower Protection Center (SBPC), which advocates for borrowers’ rights, led 128 organizations in calling for the pause to be extended until Biden follows through on reforming loan forgiveness programs and cancelling student debt.

“There is a very long way to go to deliver on the promises for student loan borrowers, between what was promised and where we are,” Seth Frotman, executive director of the SBPC, told Insider. “A lot of that is obviously because of how broken the system is and how many of the problems we’re facing are decades in the making.”

Here’s what Biden promised on student debt during his campaign, and where those promises currently stand:

Cancelling $10,000 in student debt per borrower

Biden promised to cancel $10,000 in student debt per person. In a speech on November 16, he said student loans are holding borrowers up, and forgiving $10,000 “should be done immediately.”

His campaign website said he’d work with Democrats to “authorize up to $10,000 in student debt relief per borrower” as part of COVID-19 relief, but the $1.9 trillion stimulus package he signed in March didn’t include that.

Once he took office, he said at a CNN town hall in February that he was “prepared to write off the $10,000 debt but not $50 [thousand], because I don’t think I have the authority to do it.”

The Justice and Education Departments are reviewing Biden’s executive authority to cancel $50,000 in debt, but he has yet to cancel even $10,000.

Cancelling debt for students at public colleges and HBCUs

Biden also campaigned on forgiving all undergraduate tuition-related federal student loan debt for borrowers from public colleges and universities earning up to $125,000 per year, and from private Historically Black Colleges and Universities (HBCUs) and minority-serving institutions.

Biden dedicated funding to HBCUs in both his stimulus and infrastructure proposals, but not the wider forgiveness.

Some HBCUs have used Biden’s stimulus money to cancel debt for their own students. But given student debt’s disproportionate burden on Black borrowers, organizations continue to call for the president to cancel their debt.

Reforming student-loan programs

The Public Service Loan Forgiveness (PSLF) program is supposed to forgive student debt for public service workers after 120 qualifying monthly payments, but it is notoriously flawed, continuing to reject 98% of applications. Biden promised to fix the program, and those fixes are currently in the works.

Biden’s regulatory agenda, released earlier this month, included plans to reform PSLF, along with amending the “borrower defense to repayment,” which forgives loans for students who were defrauded by for-profit schools.

The process for implementing these improvements could be lengthy, though, with the department planning to finalize the new rules by April 2022. It held public hearings this week to gather feedback on the loan system, and it will soon determine a path forward for rulemaking.

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Cisco is giving HBCUs $150 million to lessen student debt and modernize technology

howard university
  • The nonprofit Student Freedom Initiative announced a partnership with Cisco to help HBCU students.
  • Cisco’s $150 million investment would go toward modernizing technology and lessening student debt.
  • Student of color owe 100% more in student debt than white borrowers four years after graduating.
  • See more stories on Insider’s business page.

Students of color bear a significant burden of the country’s $1.7 trillion student debt crisis, and today, a major technology company announced an investment to help lift the burden off of those students.

The Student Freedom Initiative – a nonprofit dedicated to helping students at minority serving institutions (MSIs) – announced a partnership with Cisco and AVC Technologies on Thursday, with Cisco investing $150 million to help strengthen Historically Black Colleges and Universities (HBCUs). Specifically, the multinational technology company is investing $100 million in modern technology for HBCUs, along with $50 million to help lessen student debt for HBCU students.

“Their expertise and generosity will ensure that HBCUs are secure and robust institutions that empower Black students,” Robert F. Smith, Chairman of SFI, said in a statement. “And Cisco’s added financial commitment to students, making them the first anchor corporate partner of SFI, will help liberate students from crushing debt and allow them to make their own life choices.”

SFI’s press release added that Cisco’s $50 million investment is the first step to helping SFI reach its goal of a $450 million endowment supporting 4,500 students in perpetuity.

To help students financially at HBCUs and MSIs, the Student Freedom Initiative offers an “income-contingent funding option” for education costs, meaning that in exchange for funding, students agree to make payments to SFI based on what they earn after leaving college.

According to its website, the program, called the Student Freedom Agreement, is available to cover a student’s remaining costs after federal aid is taken into account, and it could serve as an alternative to private student loans. Funding for each student is capped at $20,000 a year, and there is no obligation to pay back the full amount of funding received.

Cisco’s $50 million will go toward this program, ensuring students do not have to borrow more student debt than they can pay off.

Insider reported last month that Black borrowers typically owe 50% more student debt than white borrowers, and four years later, Black borrowers owe 100% more. That’s why 36 civil rights organizations called on President Joe Biden to cancel $50,000 in student debt per borrower to help close racial disparities that have put those borrowers “on the brink of financial devastation.”

“Student debt cancellation will help Black and brown borrowers build wealth and enable our economy to move forward as millions of Americans are able to start families, buy homes, and set up small businesses,” the organizations, including the National Association for the Advancement of Colored People (NAACP), said.

Biden has not yet committed to canceling $50,000 in student debt – he is having the Education and Justice Departments review his authority to do so – but in his $4 trillion infrastructure proposal, he did include a $39 billion program that provides two years of subsidized tuition for those earning less than $125,000 enrolled in a four-year HBCU or MSI.

SFI is planning to launch its programs in the fall, and Cisco’s investment is critical in furthering the initiative’s goal of ensuring success for students at HBCUs and MSIs.

“This partnership is an investment in our future workforce, empowering AA/Black STEM students and equipping them with the financial and technology tools to be resilient and successful long term,” Maria Martinez, Cisco’s chief operating officer, said in a statement. “We remain committed to this community – to be seen, heard, valued, and invested in.”

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Biden’s Education Secretary allows undocumented college students to access stimulus funds

GettyImages-dreamers-daca-supreme-court
Advocates for immigrants with Deferred Action for Childhood Arrivals, or DACA, rally in front of the Supreme Court June 15, 2020 in Washington, DC.

  • Education Sec. Miguel Cardona said undocumented and international students can now receive stimulus aid.
  • This lifts a Trump-era policy that banned those students from receiving emergency aid.
  • The top Republican on House Education called it an insult while Senate Education’s top Democrat is relieved.
  • See more stories on Insider’s business page.

President Joe Biden’s $1.9 trillion stimulus package included nearly $36 billion in emergency funding for struggling students, but international and undocumented students were ineligible to receive that aid – until now.

Secretary of Education Miguel Cardona just eliminated that rule.

“The pandemic didn’t discriminate on students,” Cardona said in a press call on Monday. “We know that the final rule will include all students, and we want to make sure that all students have an opportunity to have access to funds to help get them back on track.”

On Tuesday, the Biden administration issued a final rule that revised a Trump-era policy barring international and undocumented students from accessing emergency aid. In June, Trump’s Education Secretary Betsy DeVos had issued a rule stating only those who participate in federal student aid programs can receive stimulus money that shut out undocumented and international students, including those protected under the Deferred Action for Childhood Arrival program, also known as “Dreamers.”

DeVos’ rule also initially barred students who defaulted on student loans and those convicted of minor drug crimes from receiving aid, but that was lifted in January.

Cardona said during the call that the final rule will apply to all three rounds of stimulus funding and will ensure every student who needs it can access aid.

“What this does is really simplify the definition of a student,” Cardona said. “It makes it easier for colleges to administer the program and get the money in the hands of students sooner.”

DeVos’ policy met a number of legal challenges, including an ongoing lawsuit initiated by California Community Colleges that said they have kept millions of dollars received for grants because of DeVos’ limits on who is eligible to receive them.

Rep. Virginia Foxx – the top Republican on the House Education Committee – called it “an insult to every American.”

“President Biden is fueling an immigration crisis, and this final rule exacerbates the emergency at the southern border,” Foxx said in a statement. “I call on elected Democrats to stop swindling law-abiding citizens, put Americans first, and respect the sacrifice of hardworking taxpayers.”

But Chair of the Senate Education Committee Patty Murray said in a statement she was “relieved” Cardona took this step to give every struggling student needed aid.

Separately, the Education Department said in a Tuesday press release that it is now making available $36 billion in grants that will help over 5,000 institutions, including Historically Black Colleges and Universities (HBCUs), Tribally Controlled College or University, and Hispanic Serving Institutions.

“These funds are critical to ensuring that all of our nation’s students – particularly those disproportionately impacted by the COVID-19 pandemic – have the opportunity to enroll, continue their education, graduate, and pursue their careers,” Cardona said in a statement. “With this action, thousands of institutions will be able to provide direct relief to students who need it most, so we can make sure that we not only recover from the pandemic, but also build back even stronger than before.”

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Most voters support Biden’s American Families Plan, poll finds

U.S. President Joe Biden addresses a joint session of Congress as Vice President Kamala Harris (L) and Speaker of the House U.S. Rep. Nancy Pelosi (D-CA) (R) look on in the House chamber of the U.S. Capitol.
President Joe Biden addresses a joint session of Congress as Vice President Kamala Harris (L) and Speaker of the House U.S. Rep. Nancy Pelosi (D-CA) (R) look on in the House chamber of the Capitol.

  • A Morning Consult/Politico poll found 58% of voters support Biden’s American Families Plan.
  • Individual provisions within the plan, such as universal pre-K, are even more popular.
  • Republican lawmakers oppose the scope and price of the plan, calling it a “$4.1 trillion grab bag.”
  • See more stories on Insider’s business page.

While Republican lawmakers have strongly opposed President Joe Biden’s American Families Plan, citing concerns with its $1.8 trillion price tag and corporate tax hikes, a new poll found the majority of voters, including Republicans, support it.

A Morning Consult/Politico poll released on Wednesday found that 58% of all voters support the president’s plan, with 86% of Democrats, 54% of Independents, and 25% of Republicans backing it. Meanwhile, individual provisions within the plan were found to have more support than the overall package, with 64% of voters supporting ensuring low- and middle-class families pay no more than 7% of their income on childcare.

“The poll, conducted in the days after Biden’s address to Congress unveiling the plan, shows that most of the individual provisions in the package are more popular among voters than the plan overall – something to keep in mind as Biden reportedly considers splitting his proposal into multiple parts to reach a bipartisan compromise,” the poll said.

Here are other main findings from the poll:

  • 63% of voters support universal pre-K for 3- and 4-year-olds;
  • 59% of voters support two years of free community college;
  • 59% of voters support a $15-per-hour minimum wage for childcare workers;
  • 57% of voters support extending the expanded child tax credit;
  • And 56% of voters support two years of subsidized tuition for Historically Black Colleges and Universities and minority serving institutions.

Biden has cited this kind of bipartisan voter support from polling in arguing for a new definition of bipartisanship that doesn’t necessarily include any Republican votes.

Before unveiling his plan, for instance, Biden said there’s no reason why infrastructure cannot be bipartisan, and The Washington Post reported in April that Biden’s definition of “bipartisanship” means support from Republican and Democratic voters – not necessarily Republican lawmaker. Indeed, while not a single Republican in Congress voted for Biden’s stimulus, several have touted elements of it. Even House Minority Leader Kevin McCarthy promoted a restaurant aid program from the stimulus.

Democratic lawmakers have advocated for the individual provisions, such as extending the expanded child tax credit from Biden’s $1.9 trillion stimulus. Many members of the party want it to be permanent, instead of the four-year extension Biden proposed.

When it comes to the price of the plan, although the majority of voters support the spending, Democrats and Republicans disagree the topic. On Monday, Senate Minority Leader Mitch McConnell drew a red line at $600 billion for infrastructure and jobs, which is less than a fifth of the $4 trillion in spending Biden proposed.

“I don’t think there will be any Republican support – none, zero – for the $4.1 trillion grab bag, which has infrastructure in it, but a whole lot of other stuff,” McConnell said.

McConnell’s remarks followed a group of GOP senators unveiling a $568 billion counter-proposal, largely focused on physical infrastructure, which Democrats called “a slap in the face” and “a joke.”

Separately, Penn Wharton Budget Model released an analysis on Wednesday that found Biden’s American Families Plan will actually cost $700 billion more than the White House’s initial $1.8 trillion estimate, while also noting that strengthened Internal Revenue Service enforcement will help raise $1.3 trillion in tax revenue over 10 years.

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‘Thank you, Jill’: The First Lady is a key voice on Joe Biden’s educational reforms

jill biden
First Lady Jill Biden.

  • Joe Biden credited First Lady Jill Biden for the boost to Pell Grants in his new spending plan.
  • Nearly 60% of Black students rely on Pell Grants to pay for college.
  • Jill Biden continues to teach at a community college and included education reforms in her First Lady agenda.
  • See more stories on Insider’s business page.

President Joe Biden’s first joint address on Wednesday night, during which he officially unveiled his $1.8 trillion American Families Plan, included a shoutout to a key influence on its educational reforms: First Lady Jill Biden.

Of the $1.8 trillion package, $318 billion of it is going to reforming the country’s education system, and Biden revealed that Jill Biden, who teaches at a community college while serving as First Lady, led the effort to include aid to Historically Black Colleges and Universities (HBCUs) and minority serving institutions (MSIs) and has been instrumental in advocating for education accessibility and certain education policies.

“She’s long said – if I’ve heard it once, I’ve heard it a thousand times: ‘Joe, any country that out educates us is going to outcompete us,'” Biden said during his speech.

Biden said in his speech that the reason for investing in Pell Grants is because HBCUs and MSIs “don’t have the endowments, but their students are just as capable of learning about cyber security, just as capable of learning about metallurgy, all the things that are going on that provide those jobs of the future,” and Jill Biden is to thank.

As part of the postsecondary education investments in the infrastructure plan, the president included investments in the Pell Grant program, which gives government subsidies to students who need it to pay for college. His plan proposed increasing the maximum Pell Grant award to $4,000, which would assist the nearly 7 million students who rely on Pell Grants.

This comes on top of a $39 billion program in the plan that provides two years of subsidized tuition for students from families earning less than $125,000 enrolled in a four-year HBCU or MSI.

A White House fact sheet said that among students of color, nearly 60% of Black, half of American Indian or Alaska Native, almost half of Latino, and over one-third of Native Hawaiian or Pacific Islander students rely on Pell Grants to pay for college.

Jill Biden continues to teach classes at Northern Virginia Community College and has laid out an agenda of her own, which includes educational reforms.

“She’ll be deeply involved in leading this effort,” Biden said. “Thank you, Jill.”

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