The new date is August 24, 2022.
Out of 45 million Americans with student loan debt, here are the people who will benefit the most from the plan announced by President Joe Biden.
There is a protest near the White House.
The initiative could wipe out all outstanding federal student loans for up to 14 million borrowers who held less than $10,000 in debt as of the end of June, accounting for 32% of all borrowers.
At least half of the student loan debt held by the 20.5% of borrowers who owe between $10,000 and $20,000 will be erased by the policy.
Only a small amount of relief for the most indebted Americans: Some 38% of the total outstanding federal student loan debt is held by borrowers with balances of more than $100,000, even though they account for just 2.5% of all borrowers.
Despite the $125,000 income cap, research shows the White House plan still favors higher income Americans.
The top 10% of Americans hold more student loan debt than the bottom 20%, according to the Federal Reserve.
Since Biden took office, progressives have pushed him to take action on student loan relief, though he has been hesitant to do so due to concerns about fairness, legality and how it may impact inflation. More than two-thirds of bachelor's degree recipients take out federal student loans. The federal government says that students who went to public colleges hold more student loan debt than those who went to private colleges. According to an analysis of Department of Education data by the Texas Public Policy Foundation, students with more advanced degrees take on more debt than students with less advanced degrees.
According to the Penn Wharton Budget Model, a blanket $10,000 forgiveness plan would have cost the federal government $311 billion, but the $125,000 income limit would only save the government a small amount. The research shows that the policy benefits poorer Americans more than it hurts.
It was over 60 percent. The White House says that 20% of borrowers are eligible for $20,000 in relief.
The relief measure was criticized for its high cost and potential impact on inflation, which hit a 40 year high earlier this year. McConnell points out that it fails to help blue-collar workers who never go to college. McConnell said the initiative was "astonishingly unfair and a slap in the face to every family who sacrificed to save for college, every graduate who paid their debt and every American who chose a certain career path."
Here are all the other details of Biden's student loan forgiveness plan.
Budgetary costs and distributional impact are consequences of giving student loans.
Who are the federal student loan borrowers and who benefit from forgiveness? The economics of Liberty Street.
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