Biden will talk about student debt relief in Wisconsin after primary voting delivered warning signs

Posted at 9:37 AM, Apr 08, 2024

WASHINGTON (AP) — President Joe Biden is traveling to Wisconsin to announce details of a new plan to ease student loan debt for more than 30 million borrowers, a trip that follows primary voting in the Midwest battleground that highlighted weaknesses for the Democratic president and Donald Trump, his Republican challenger.

Biden was making the announcement Monday in Madison, the state's liberal capital and home of the University of Wisconsin's flagship campus. He was speaking at a nearby technical college.

A new federal rule paving the way for student debt relief is unlikely to be issued by the time the president speaks, but he will highlight a plan the Department of Education has been working on since the U.S. Supreme Court last year foiled his first attempt to forgive hundreds of billions of dollars in student loan debt.

Immediately after the court said Biden needed Congress to approve his original plan, the president called the decision a "mistake" announced that Education Secretary Miguel Cardona would undertake a new process using his authority under the Higher Education Act to waive or compromise student loan debt in specific cases.

A fresh announcement on student loan relief, an important issue for younger voters, could help energize parts of Biden's political coalition that have become disillusioned by his job performance. These are people whose support the president will need to defeat Trump in November.

In Wisconsin's primary elections last week, nearly 119,000 Republicans voted for a GOP candidate other than Trump, the party's presumptive nominee. And more than 48,000 Democratic voters chose "uninstructed" instead of Biden, more than double Biden's narrow margin of victory in Wisconsin in 2020.

Nearly 15% of Democrats in Dane County, home to Madison, voted "uninstructed." That is nearly double the statewide total of 8%.

Democratic U.S. Rep. Mark Pocan, who represents Madison, said he was struck that concerns about Israel's war against Hamas in Gaza were top of mind among voters at five town halls over the past two weeks in more rural parts of his district.

"I was surprised to see the intensity on the issue of Gaza coming not from a student voice out of Madison, but older voters in more rural parts of the district," Pocan said.

Pocan said the number of "uninstructed" votes shows the concern in Wisconsin and that Biden needs to address it. He said he planned to talk directly with Biden about it on Monday.

"I just want to make sure he knows that if we're going to have a problem, that could be the problem in Wisconsin," Pocan said.

Biden's new plan would expand federal student loan relief to new categories of borrowers through the Higher Education Act, which administration officials believe puts it on a stronger legal footing than the sweeping proposal that was killed by a 6-3 court majority last year.

The plan is expected to be smaller and more targeted than Biden's original plan, which would have canceled up to $20,000 in loans for more than 40 million borrowers.

The new plan would cancel some or all federal student loans for more than 30 million Americans, the White House said. The Education Department plans to issue a formal proposal in the coming months, with plans to start implementing parts of the plan as early as this fall.

"President Biden will use every tool available to cancel student loan debt for as many borrowers as possible, no matter how many times Republican elected officials try to stand in his way," White House press secretary Karine Jean-Pierre said in a call with reporters.

Details the White House released on Monday largely mirror a plan drafted by the Education Department. It lays out five categories of borrowers who would be eligible to get at least some of their federal student loans canceled if the rule is approved.

The plan's widest-reaching benefit would cancel up to $20,000 in interest for borrowers who have seen their balance grow beyond its original amount because of unpaid interest. Borrowers could get the entirety of their interest erased, with no limit, if they are enrolled in an income-driven repayment plan and have annual incomes of less than $120,000 or couples making less than $240,000.

That part of the plan would forgive at least some unpaid interest for an estimated 25 million borrowers, with 23 million getting all their interest erased, according to the White House.

An additional 2 million borrowers would automatically have their loans canceled because they're eligible but have not applied for other forgiveness programs, such as Public Service Loan Forgiveness.

Borrowers who have been repaying their undergraduate student loans for at least 20 years would be eligible to have any remaining debt canceled, along with those repaying their graduate school loans for 25 years or more.

The plan would forgive debt for those who were in college programs deemed to have "low financial value." It's meant to help those who were in programs that ended up losing eligibility to receive federal student aid or programs found to have cheated students.

A final category would cancel debt for borrowers facing hardships that prevent them from repaying their student loans, either because they're at high risk of defaulting or are burdened with medical debt or child care expenses, among other criteria.

Cardon said in a call with reporters that the relief that would be provided under the new plan would be "on top of the $146 billion in student loan debt relief for 4 million Americans that we've already approved, more than any other administration in our country's history."

Hearings to craft the rule wrapped up in February, and the draft is under review. The Education Department will issue a formal proposal and open it to public comment before it can be finalized.

The latest attempt at cancellation joins other targeted initiatives, including those for public service workers and low-income borrowers. Through those efforts, the Biden administration says it has canceled $144 billion in student loans for almost 4 million Americans.

Advocates of student loan debt relief welcomed the news, while those who track federal spending expressed concern about the cost.

Biden was to attend a campaign event in Chicago before returning to the White House late Monday.