Biden bails out 74K student loan borrowers with $5B in canceled debt

 The Biden administration has approved an additional $5 billion in debt cancellation for about 74,000 student loan borrowers, the White House said in a statement Friday.

President Biden said many of the borrowers affected by his latest student loan distribution are public sector workers, such as teachers and firefighters, whose loans will be eliminated after 10 years of public service. About 30,000 borrowers affected have been making repayments for at least 20 years, Biden said, “but they never received the relief they earned through income-driven repayment plans.”

The latest round of student loan cancellation brings the total amount canceled under Biden for more than 3.7 million Americans to $136.6 billion, according to the Education Department. This comes after the US Supreme Court last year blocked Biden's initial student loan distribution, which would have cost more than $400 billion.

Biden said, "From day one of my administration, I vowed to reform the student loan system so that higher education provides Americans with opportunity and prosperity – not an unbearable burden of student loan debt." “I will not hesitate to use every tool at our disposal to get student loan borrowers the relief they need to reach their dreams.”

The additional loan cancellations are the result of adjustments made by the Biden administration to the income-driven repayment forgiveness and public service loan forgiveness programs.

U.S. Secretary of Education Miguel Cardona said, "The Biden-Harris Administration has worked tirelessly to fix our nation's broken student loan system and remove unnecessary barriers and administrative inaccuracies that have prevented borrowers from receiving student loan forgiveness in the past. Used to stop us from getting it." in a statement.

“The approximately $5 billion in additional loan relief announced today will be provided to teachers, social workers and other public servants whose service to our communities has earned them public service loan forgiveness, as well as income-driven repayment to borrowers due on their "This is the first time that those who will qualify for forgiveness are being accurately accounted for."

Friday's announcement follows action taken by Biden last week for student loan borrowers enrolled in the Savings on Valuable Education (SAVE) plan. Borrowers enrolled in SAVE who have borrowed less than $12,000 and have been making repayments for 10 years will have their loan balances reduced to zero next month.

According to the Penn Wharton budget model, SAVE would have a net cost of $475 billion over a 10-year budget window.

In December, Biden approved $4.8 billion in student loan cancellation for more than 80,000 borrowers.

Republicans have condemned Biden's student loan distribution, arguing that taxpayers will ultimately have to foot the bill for the president's contribution to the $34 trillion national debt.

House Education Committee Chairwoman Virginia Foxx, R-N.C. Said, "President Biden is completely desperate to buy votes before the election – to the extent that he has given the Department of Education the green light to pour more kerosene on the already raging student debt fire." In a statement released after the Biden administration announced the SAVE plan last week.

“It wouldn't surprise anyone if the department relied on babies playing with an abacus to balance its books – it's a complete and utter disaster. It's clear that the Biden administration needs a good old-fashioned dose of fiscal common sense. All that's required – he knows how Foxx said, "To do that means to spend like a drunken sailor."