There are enough reasons to decry Joe Biden’s somewhat belated decision to cancel some student-loan debt. Biden took until August of his second year as president and didn’t come close to delivering on his original campaign promise. There are plenty of non-wealthy Americans who hold far more than the debt Biden would relieve, who are desperate to escape burdens that will trail them for the rest of their lives. In limiting the scope of the cancellation, Biden may end up inflaming conservatives and moderates without getting the added benefit of firing up his base. The politics of the move are intriguing, if also perilous. The right-wing Supreme Court could shoot it all down.
The critics, on the left and right, are correct to argue that a limited debt cancellation will not reform the most galling practices of higher education. It will not force individual states or the federal government to subsidize public colleges and universities at the levels seen in the 20th century, when attending a state school in California or New York was effectively free. It will not pressure college administrators to curtail wasteful overhead or exorbitant tuition and fees. It certainly will not force rich colleges to start paying taxes on their endowments.
Yet it is important, amid all the hand-wringing, to pause and reflect on what Biden is actually trying to do. No other American president attempted to cancel student debt. No president attempted to unilaterally erase such significant amounts of money owed to lenders. Not since the Affordable Care Act, perhaps, has a president tried to deliver benefits so tangible. Voters often feel disconnected from government because even the big decisions or far-reaching policies take years to trickle down to them, to impact their lives directly, including Obamacare. Debt cancellation is very different. For individuals earning under $125,000, $10,000 will be wiped away. The $20,000 cancellation for those who had received Pell Grants for low-income families is even more significant. A generation of working-class Americans who did attend college — almost 40 percent of the nation has a college degree, and many more attempt to get one — will now find relief, a chance to start anew. Some may be able to afford down payments on homes. Others might pay off other bills or finally be able to build up a nest egg for retirement. This cannot be waved away, and shouldn’t be.
It also marks a great victory for both Bernie Sanders and Elizabeth Warren, despite the lamentations from their supporters. Biden would not have erased any student debt if Sanders hadn’t run for president in 2016 or 2020. He would not be doing it if Warren hadn’t made the passionate case for years in the Senate or run for president herself. Chuck Schumer, the Senate majority leader, became such an advocate for canceling student debt because he feared, in part, progressives could doom him in New York with a primary challenge for his seat. Before the emergence of Sanders, he was a consummate moderate; he responded to public pressure, and it’s worth reflecting on how much of a triumph this will be for the activist left, assuming the policy holds in court.
Like Richard Nixon going to China, it may have taken a creature of the calcified Establishment like Biden to take such a remarkable step to the left. Biden spent most of his career in the Senate clinging to the ideological middle, defending the credit-card industry, voting to deregulate Wall Street, and championing the carceral policies that fed America’s prison boom. A failed two-time presidential contender before finally capturing the nomination in 2020, Biden was part of a generation of Democrats who cemented America’s neoliberal turn, rejecting New Deal economics for a far more unfettered capitalism. He was, like Bill Clinton, a believer in triangulation, of the Democratic Party absorbing as much Republican policy as possible to stave off electoral defeat. The Biden of the 1980s or 1990s would have scoffed at the idea of bailing out anyone, let alone the holders of student debt. But it’s also a Nixonian turn in a domestic sense — it was Nixon who, after all, created the Environmental Protection Agency and oversaw the implementation of Lyndon Johnson’s Great Society programs. American politics has a way of surprising.
Could a President Sanders or Warren have found the political room to make such a maneuver? Probably, if they acted fast, before pressure built on them to migrate from the left to placate middle-of-the-road voters, and before the media portrayed them as too radical to govern. Biden, though, felt the need to attempt to shore up his left flank and meet the demands of voters who were skeptical of him in 2020 or chose him reflexively as merely the best option to defeat Trump. With his popularity at low tide, he needs to placate any voter base he can find. Targeting younger voters is one way to do it.
This move does reward, in part, an educated class that is increasingly voting Democratic. But it is also highly disingenuous of critics to argue student debt is like all other debt. It is almost impossible to discharge student loans in bankruptcy court. All other borrowers can hope that one day, through declaring bankruptcy, their debts are restructured or wiped out, with the punishment of a ruined credit rating. No such plausible option exists for the student borrower. The only other way to discharge a student loan, other than paying it off along with the dizzying interest, is to die. There are college graduates and dropouts who have resigned themselves to that fate.
For years, progressives had made this point repeatedly. Sanders began his campaign talking about tuition-free higher education, promoting an idea that was broadly accepted for long stretches of the last century but had become, due to the skyrocketing costs of higher education, far-fetched by the 2010s. The debt-cancellation movement took off after 2016, and it was never a given that Biden, a career centrist, would take up the cause at all. The leftward tilt of the 2020 primary forced him there. It made him make a public promise. Now, even in a watered-down version, he is delivering.