President Joe Biden was denied the ability to erase debt in July 2021 by House Speaker Nancy Pelosi, who said that doing so would be against the law and that Congress must pass legislation to do so.
The executive branch does not have the legal authority to cancel, compromise, discharge, or forgive student loan principal balances on a general or mass scale, or to materially alter the repayment amounts or terms, according to the Department of Education, which supported Pelosi’s position in a memo from 2021.
Despite Pelosi’s comments, Biden signed an order on Wednesday waiving up to $10,000 in federal student loans for those making under $125,000 a year and under $250,000 for households, as well as waiving $20,000 for people receiving Pell grants. His choice, which comes months before the midterm elections, is the largest loan cancellation program in history.
When Pelosi was questioned on Tuesday regarding rumors that the announcement would soon be made, she seemed to be pleased with the information even if she noted that it was not obvious from whence Biden had the approval for it.
“Well, we’re happy for the president because we weren’t sure what — or what power he had to do this. And as of right now, it is obvious that he has the power to provide $10,000 to anyone with annual incomes under $125,000.
A question from National Review asking if Pelosi still stood by those remarks was not quickly answered by her staff.
Republican senators attacked Biden in a flurry of speeches on Wednesday, claiming that the plan only rewards the wealthy and shifts the burden to the general population.
