The extended student loan freeze might help President Biden and Democrats keep young people engaged in November’s midterm elections.
Biden has been happy to keep the moratorium going, saying it is a way to protect people from economic problems.
White House officials say this is the only time no one has been asked to pay back student loans.
The deadline is Aug. 31; although, it may be extended until the November midterms. Nearly 100 Democratic legislators signed a petition calling for the loan freeze to remain until the end of 2022.
This will “financially destabilize” creditors and cause difficulty for those who cannot pay it, the letter claims. In addition, it may help Democrats retain a slim majority in Congress.
Although student loan debt impacts both parties, it affects younger voters more than older ones.
Republicans have mostly opposed the extension, with Arkansas Sen. Tom Cotton calling it “an insult” to debt-payers.
So if Democrats are going to forgive student loans… Does that mean they're going to cut fat checks for people who were responsible enough to pay their loans off?
— Tim Young (@TimRunsHisMouth) April 6, 2022
A Data for Progress poll revealed over half of respondents said student loan cancellation would encourage them to vote.
In contrast, a Morning Consult poll suggested delaying payments was popular among younger voters.
The halt has switched from the epidemic to the shock of needing payments, especially with rising inflation.
A petition signed by 100 Democrats says inflation has left most people unable to pay back their debts.
To Marc Goldwein of the Council for a Responsible Federal Budget, the halt itself leads to inflation.
He claims full student debt forgiveness will increase inflation by 0.5% in the first year, owing to increased spending and supply restrictions.
Goldwein is worried about students taking out more loans because he thinks they will be able to get their debts forgiven, with colleges charging more tuition for the same reason.
Student loans are really simple… You borrow money, you pay it back. All of it.
— Gunther Eagleman (@GuntherEagleman) April 6, 2022
The halt affects 41 million borrowers with a combined debt of $1.3 trillion and has reportedly cost taxpayers over $100 billion.
The halt was instituted two years ago, but unemployment for college graduates dropped below 2%, raising questions about the necessity of a prolonged delay that affects the highly educated.
Officials like White House chief of staff Ron Klain and spokeswoman Jen Psaki are now hailing the halt as a benefit for the current administration.
Psaki said Tuesday when she makes evaluations, she considers the needs of those touched by student loan debt.
With the extensions lasting for at least five months, the question of where they stop arises. Biden campaigned on absorbing at least $10,000 per individual in student loan debt.
Psaki underlined he would support the measure if Congress first approved it.
Even if mass cancellation doesn’t happen this year, extending the suspension beyond Election Day will leave young voters with only one choice.
“I believe there’s a real risk that young people won’t vote,” Green remarked. A dismal election map might become much bleaker.