Federal student loan forgiveness of up to $50,000 is possible, Schumer explains

Senator Chuck Schumer wants to give American car buyers thousands of dollars each to trade in gas-burning cars for U.S.-assembled electric, hybrid or hydrogen cell cars. (File photo)

Senator Charles Schumer and a number of soon-to-be Congress members have a plan to cancel up to $50,000 in student loan relief for Americans already burdened with debt before the pandemic, which has only magnified their hardships.

Congressmen-elect Jamaal Bowman, Mondaire Jones, and Ritchie Torres say they plan to make this proposal a priority upon taking office which will mean those who took out loans from the federal government could cancel a substantial amount of debt through the bill titled the Higher Education Act

“Millions of young Americans, including so many New Yorkers we represent—and their families—have been crushed by student loan debt, greatly impeding their ability to begin careers and build the financial resources needed to rent apartments, buy homes, start families or just simply build their futures,” Schumer said. “Even worse, the debt load average across New York is actually higher than it is across the country, and this holds down our entire local economy, which we cannot afford to suppress after dealing with the financial devastation of COVID.”

The legislation will hinge on President-elect Joe Biden using executive authority, essentially creating another avenue of COVID-19 relief apart from any stimulus bills that are presented over the course of the pandemic that lasts under Biden’s administration with vaccines on the way.

“It’s flat-out wrong that people in this country hold more than $1.6 trillion in student debt,” Bowman said. “But the Biden administration has the power to do something about that, and can act even if Republicans in the Senate choose to ignore the problem. Forgiving $50,000 in student debt will change young people’s lives, particularly for Black young people, who hold far more student loan debt than their White peers.”

According to Schumer, student debt relief was promised in the $2 trillion HEROES Act which was passed by Congress in May but did help up in the Republican-led senate under the thumb of Majority Leader Mitch McConnell. 

“For every generation before mine, education has offered young people a ticket to the American Dream,” Jones said. “Unfortunately, that dream has not materialized for the youth of today, especially in Black and brown communities. Wages have remained stagnant for decades as the costs of higher education, and of living generally, have skyrocketed. Forgiving student debt would liberate millions of Americans to participate meaningfully in our economy through homeownership and entrepreneurship, and it would be a critical step toward racial, generational, and economic justice.”

Would $50,000 be enough to level the playing for the 58% of Americans who walk away from school with student loans to justify?

New York City residents on average hold about $38,000 in student loan debt while the national average runs at around $32,700 leaving many with little choice but to postpone their dreams of buying homes, cars, or starting families.