Pelosi says student loan forgiveness ‘should be an act of Congress’, contradicting Schumer

House Speaker Nancy Pelosi (D-CA) threw cold water on the idea pushed by other prominent Democrats that President Biden could execute student loan forgiveness by means of an implementing decree.

“People think the President of the United States has the power to cancel debt — he doesn’t,” Pelosi said during her speech. weekly press conference on Wednesday. “He can defer, he can defer, but he doesn’t have that power. That should be an act of Congress.”
Watch Free Movies and TV shows Apps

🎬📺 Free Movies and Free TV Shows! 🎭🎬

Other Democratic lawmakers, led by Senate Leader Chuck Schumer (D-NY) and Senator Elizabeth Warren (D-MA), have repeatedly urged President Biden Takes Action student loan forgiveness of $50,000 per borrower of a federal loan.

“President Biden can undo this” [student] debt – can cancel $50,000 in debt – the first day he becomes president,” Schumer (D-NY) said in Dec 2020. “You don’t need Congress. All you need is a tap with a pen.”

On Tuesday, warren said: that extending the payment pause from the student loan pandemic — which currently ends at the end of September — and canceling debt “is a matter of economic justice. It’s a matter of racial justice. The President of the United States can remove this sword. president can prevent this pain. The president can cancel $50,000 in student loans.”

One of Biden’s campaign promises involved in canceling $10,000 in federally-backed student loans for all borrowers, but the president has been skeptical on large-scale forgiveness of up to $50,000 in student loans through executive action (as opposed to legislation passed by Congress).

The basic argument for the president to be able to forgive student debt through executive measures, such as: detailed by the Legal Services Center of Harvard Law School in a letter to Senator Warren, is that the Secretary of Education has the power “to cancel existing student loan debts under a separate legal authority – the power to amend existing loans that are in 20 USC 1082(a)(4).”

US Speaker of the House, California Democrat Nancy Pelosi, holds her weekly press conference on Capitol Hill in Washington, DC, on July 28, 2021. (Photo by Nicholas Kamm/AFP) (Photo by NICHOLAS KAMM/AFP via Getty Images)

US Speaker of the House, California Democrat Nancy Pelosi, holds her weekly press conference on Capitol Hill in Washington, DC, on July 28, 2021. (Photo by Nicholas Kamm/AFP) (Photo by NICHOLAS KAMM/AFP via Getty Images)

In March 2020, White House Chief of Staff Ron Klain told Politico that President Biden had asked Education Secretary Miguel Cardona to draft a memo about whether the president has the legal authority to waive $50,000 in student loans through an executive order.

The Education Department (ED) did not respond to requests for comment on the memo, although ED recently hired Toby Merrill, who founded the Project on Predatory Student Lending at Harvard Law School and co-authored the legal analysis provided to Warren.

Asked about the discussion with the White House on Tuesday, Schumer said they are “making good progress” on both the payment pause and forgiveness.

“I think we’ve made progress — some of the arguments they used to make they don’t make anymore,” Schumer said. “One is that it’s going to be taxed – we’ve taken care of that … another is that they don’t have the legal authority – we don’t hear much about that because we think they do. So we’re making progress and we’re going for it.”

Pelosi, who spoke on Wednesday, went the opposite direction.

“Suppose… your child has just decided that, at this moment, she [do] don’t want to go to college, but you pay taxes to forgive someone else’s obligations — you may not be happy about that,” Pelosi said. “But you know what, we want all our children to achieve fulfillment to the extent that they want to go to university. We don’t want them banned for financial reasons.”

Aarthi is a reporter for Yahoo Finance. She can be reached at [email protected] Follow her on Twitter @aarthiswami.

Read more:

Follow Yahoo Finance on Twitter, Facebook, Instagram, flip board, SmartNews, LinkedIn, YouTube, and reddit.

Leave a Comment