The Education Department just made a historic statement, announcing that it will automatically erase student loans for over 800,000 students.  This move comes from what the department terms a "fix" to income-driven repayment plans and is expected to provide $39 billion in federal student loan forgiveness.

The decision aims to address administrative issues that have plagued the income-driven repayment system. According to the existing plans, federal student loan borrowers become eligible for forgiveness after making payments for 20 or 25 years, depending on their specific repayment plan.

However, as per the Education Department's news release, some qualifying payments meant to bring borrowers closer to forgiveness were not properly accounted for.

It's worth noting that the announcement comes after a recent Supreme Court ruling. Last month, the court struck down President Joe Biden's plan to forgive up to $20,000 in debt for 43 million federal student loan borrowers, dealing a significant blow to one of his key campaign promises.

President Biden remained determined to pursue student debt loan relief through other avenues despite the setback. He expressed his administration's commitment to finding alternative solutions: "Today's decision has closed one path. "We're going to pursue another now," he said.

To do this, Biden authorized the Education Department to create a new loan forgiveness scheme based on the Higher Education Act. He emphasized that the proposal would be "legally sound" while acknowledging that it might take time before a comprehensive plan could be introduced. However, specific details of the new plan have yet to be unveiled.

The recent announcement represents a smaller step the Biden administration is taking to address federal student loan relief using its existing authority.

Education Secretary Miguel Cardona expressed his views on the matter: "For far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness. By correcting prior administrative errors, we guarantee that everyone receives the forgiveness they deserve."

Nevertheless, not everyone was pleased with the decision. GOP Sen. Eric Schmitt of Missouri voiced his concerns, accusing the administration of trying to circumvent Congress and implement widespread changes unilaterally.

Schmitt claimed that the administration intended to enact a new debt cancellation plan under Section 432(a) of the Higher Education Act, which he deemed unlawful. He further emphasized that this plan would impose an undue financial burden on hardworking American taxpayers.

In response to criticism from congressional Republicans, President Biden defended the move, highlighting the hypocrisy he perceived. "Republican legislators — who had no problem with the government erasing millions of dollars of their business loans — have tried everything they can to prevent me from providing relief to hardworking Americans," Obama said. Biden expressed his dismay at the opposition to the actions that aimed to deliver the promised relief to borrowers who had been making payments for decades yet were denied forgiveness.

The Education Department's decision to automatically forgive student loans for more than 800,000 borrowers represents a significant step toward addressing the student debt crisis.

The $39 billion in federal student loan forgiveness is poised to make a substantial difference in the lives of those burdened with educational loans. While some criticize the move, claiming it bypasses Congress, the Biden administration remains steadfast in helping borrowers struggling with student loan debt.

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