WASHINGTON — President Joe Biden is taking another shot at student loan cancellation, hoping to deliver on a key campaign promise that he has so far failed to fulfill. In a visit to Wisconsin on Monday, Biden detailed a proposal that would cancel at least some debt for more than 30 million Americans. It’s been in the works for months after the Supreme Court rejected Biden’s first try at mass cancellation.
Biden called the court’s decision a 'mistake' but ordered the Education Department to craft a new plan using a different legal authority. The latest proposal is more targeted than his original plan, focusing on those for whom student debt is a major obstacle.
The Biden administration says some debt could be canceled as soon as this fall, including interest that has snowballed on top of borrowers' loans. That timeline would require some maneuvering. The Education Department said it plans to release a formal proposal in the 'coming months.' That would usually be followed by a public comment period of 60 days. Then if the rule is finalized by Nov. 1, it would usually take effect the following July — in this case, July 2025.
Technically, there are ways that canceled student debt can be reinstated. But doing it on such a large scale could be difficult and costly, requiring heavy work from loan servicers contracted to work for the Education Department. It could also be politically fraught to reinstate debt after it’s been forgiven. Ultimately it could be up to the courts to decide how to handle debt that’s already been canceled.