On Wednesday, President Joe Biden sent out emails to over 150,000 borrowers, informing them that their “federal student loans will be forgiven.” However, it is important to note that this forgiveness is actually a transfer of the debt burden to the American taxpayer.
According to Politico, the Biden administration plans to transfer a total of $1.2 billion from these borrowers’ collective debts under the Saving on a Valuable Education (SAVE) plan. In the email, the president, who is politically vulnerable, takes credit for the forgiveness right from the start.
“Congratulations—all or a portion of your federal student loans will be forgiven because you qualify for early loan forgiveness under my Administration’s SAVE Plan,” the email, published by Politico, reads.
“From day one of my Administration, I vowed to fix student loan programs so higher education can be a ticket to the middle class—not a barrier to opportunity,” the letter states. Biden adds he hopes “this relief gives you a little more breathing room.”
“The borrowers receiving relief are the first to benefit from a SAVE plan policy that provides debt forgiveness to borrowers who have been in repayment after as little as 10 years and took out $12,000 or less in student loans,” the White House stated in a press release.
Per Biden’s correspondence, the Department of Education will notify loan servicers about borrowers’ eligibility, and once the servicer processes the “forgiveness,” they will communicate it to the borrowers.
Biden’s decision to make this move is influenced by his trailing position behind former President Donald Trump by almost two percentage points in the national RealClearPolling average. Additionally, his approval rating in late January was reported to be at a historic low, according to Gallup, adding to the urgency of this decision. Furthermore, Biden has been under close examination regarding his age and mental sharpness, especially after the release of Special Counsel Robert Hur’s critical report on the president’s classified document investigation, where Hur highlighted Biden’s memory as being “significantly limited.”
