Personal Finance

Biden makes no mention of student loan forgiveness in State of the Union address

Key Points
  • In Biden's address to the nation, he made no mention of student loan forgiveness.
  • Advocates and borrowers worry the issue is being tabled.
President Joe Biden delivers the State of the Union address during a joint session of Congress in the U.S. Capitol’s House Chamber on March 1, 2022.
Getty Images

In President Joe Biden's more than hourlong State of the Union address Tuesday night, he made no mention of federal student loan forgiveness, worrying advocates and borrowers that he's walking back on one of his key campaign promises.

Biden instead focused on topics such as raising the minimum wage, extending the child tax credit and implementing paid family leave, after the first part of his speech was dedicated to denouncing President Vladimir Putin of Russia for the invasion of Ukraine.

Asked why Biden didn't mention student loans, the White House said it continues to explore its options for canceling student debt. However, the lack of movement or even mention of loan cancellation is a signal to many that it's becoming less of a priority for the administration, which says it plans to resume the payments in May after more than two years of pausing them because of the Covid pandemic's financial fallout.

At a recent news conference, a reporter asked the president if he still planned on canceling student debt. He didn't answer.

"On a night when President Biden took time to list his priorities for the coming year, to hear absolutely nothing about student loan debt is so discouraging and sad," said Scott Heins, a photojournalist in Brooklyn, New York, who still owes around $20,000 after more than a decade of payments.

"[He] boasted about the state of the economy and the jobs created under his watch, but what about the 43 million Americans who are burdened with debt simply because they went to college?" Heins, 33, said.

Scott Heins
Courtesy: Scott Heins

Even before the pandemic, the country's outstanding student loan debt balance exceeded $1.7 trillion and posed a larger burden to households than credit card or auto debt. Roughly a quarter of borrowers, or 10 million people, were estimated to be in delinquency or default. A recent report by the Government Accountability Office found that as many as half of people with federal student debt may now be at increased risk of falling behind.

Still, with the midterm elections looming, the president appeared to stay away from more contentious topics during his speech, which may explain the omission of debt cancellation, said higher education expert Mark Kantrowitz. Republicans mostly oppose canceling education debt.

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"It looks like he's going mostly for issues that have bipartisan support, with a few standard Democratic issues thrown in," Kantrowitz said.

Critics of a student debt jubilee say that it would be unfair to those who didn't borrow for their education and who've paid off their loans, and that it wouldn't significantly stimulate the economy because college graduates tend to be higher earners more likely to redirect their monthly bill to savings than additional spending.

Yet progressives and advocates say the student debt crisis has caused the most pain for women, people of color and those who didn't come from wealthy families who could foot the rising bills of a college education. And they warn that inaction will cost Democrats in November.

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"A lack of movement on student debt cancellation will result in the Democratic party's base — young people, Black voters — staying at home," said Thomas Gokey, co-founder of the Debt Collective, a national union of debtors.

A recent poll found that nearly two-thirds of likely voters are in support of Biden canceling some or all of student debt, with more than 70% of Latino and Black voters in favor.