Last week, 1.5 million people filed for unemployment, leaving much of the country anxiously awaiting Congress to pass another coronavirus relief or revival plan. The increased unemployment benefits expire at the end of July, so time is of the essence. Something is likely to pass, but don’t count on it, including the student loan forgiveness.
The cancellation of student debt was seen by many as a partisan issue. It became a popular point of contention during the 2020 Democratic presidential primary, with candidates proposing various debt cancellation plans. As the coronavirus swept the country, this conversation was reignited.
Many Democrats pushed for student loan cancellations as part of coronavirus relief before the CARES Act. Senator Elizabeth Warren and other Senate Democrats requested a minimum of $ 10,000 in student debt cancellation. Democratic presidential candidate Joe Biden backed the plan. Some progressive members of Congress have even asked for $ 30,000 in debt cancellation.
A Republican Senate assistant for education told reporters in the spring, there was not much appetite to forgive student loans as part of coronavirus relief. Others expressed some confusion as to why debt forgiveness would be included when student loans are not linked to the coronavirus.
Ultimately, both sides compromised and suspended student loan payments until September, when they passed the CARES law. Since then, new calls for the cancellation of student debt have continued.
House Democrats proposed the HEROES law with $ 10,000 in student debt cancellation for phase four of coronavirus relief. However, they reduce forgiveness only borrowers in difficulty before adopting the bill.
But there was no movement in the Senate on the HEROES law. Senate Majority Leader Mitch McConnell has repeatedly said that whatever passed will be the last stimulus. Recently, he told a president of a Kentucky university that any new stimulus would have to be job-related because he wouldn’t want to keep adding billions of dollars in spending.
Trump recently said he would consider another stimulus check. He told a reporter that he was considering a “spectacularPhase 4. But his advisers indicated otherwise.
Instead, many Conservatives are pushing for lower payroll taxes, although this does nothing to help the unemployed. Trump originally seemed open to debt cancellation, but with Conservatives pushing for tax cut instead of direct relief, student debt cancellation also seems out of the question.
Ultimately, student borrowers could see an extension of the disruption of student loan repayments. Trump was one of the first to propose a suspension of payments at the start of the pandemic. However, it is highly unlikely that student borrowers will see the cancellation of student loans as part of a stimulus package.