The White House announced on Thursday that 60,000 more public service workers had been recently approved for the Public Service Loan Forgiveness program.
Credit...Sophie Park for The New York Times

Biden’s Student Loan Forgiveness Program Has Canceled Debt for Over One Million People

An effort to revive and maximize use of the Public Service Loan Forgiveness program has resulted in student loan forgiveness for over one million people.

by · NY Times

The Biden administration has reached a major milestone in its pursuit of expansive student debt relief, announcing on Thursday that over one million people have had their federal student debt canceled through a program that offers forgiveness to public service workers.

For President Biden, whose student debt agenda has been repeatedly handicapped by Republican legal challenges, the announcement marked a modest but undeniable achievement. With just weeks until the election, the administration has reported approving around $175 billion in total student debt relief for nearly five million borrowers through all the actions taken during Mr. Biden’s presidency.

Those numbers reinforce the central conundrum Mr. Biden faces on student debt. He has fallen far short of the sweeping $400 billion in loan cancellation for as many as 45 million borrowers he originally sought. But even as that has left some supporters disillusioned, he has provided far more debt forgiveness through a variety of smaller measures than any previous president.

Public Service Loan Forgiveness, a program established by Congress in 2007 that allows a variety of workers in the public and nonprofit sectors to have their student loans canceled after 10 years of employment, is a bright spot. White House officials said the recent approval of 60,000 more public service workers for debt relief under the program had brought the tally under the administration to over one million people, who collectively had $74 billion forgiven.

“It represents a promise by President Biden and Vice President Harris to fix broken student loan programs that will have an impact, not only on these one million people and their families, but on millions more who are considering going into careers in teaching, nursing or other public service fields in the years to come,” Natalie Quillian, a deputy chief of staff in the White House, told reporters during a call on Wednesday.

Several studies have suggested a relationship between large student loan burdens and an unwillingness among borrowers to work in lower-paying public interest fields such as education, government and the nonprofit sector.

To help subsidize education for students considering those fields, Congress established the program to allow people working in public service to have their student loans forgiven after 10 years of payments.

But the program fell victim to woefully poor implementation. In the first year after forgiveness eligibility began in 2017, only 96 borrowers were able to claim benefits, and more than 99 percent of those who applied were rejected.

A report by the Consumer Financial Protection Bureau in 2017 found that federal loan servicers routinely failed to inform borrowers working in qualifying jobs about their eligibility for the program, and systematically miscounted payments that could count toward forgiveness. According to the White House, when Mr. Biden took office in 2021, only 7,000 people had been able to take advantage of the program.

“By then, people lost faith — they called P.S.L.F. a cruel joke, a broken promise, a nightmare,” Miguel A. Cardona, the secretary of education, told reporters during a call on Wednesday. “This is how folks described the program to me when I became secretary.”

The Biden administration has repeatedly been thwarted in court as federal judges and the Supreme Court have found that the Education Department stretched its legal authority to improperly wipe out federal student loan balances using several other avenues. But Public Service Loan Forgiveness has proved resilient and well suited to the president’s goals.

The law, as written by Congress, is clear about the path students can take to qualify. And its purpose — reducing the burden on workers who chose modest salaries and careers in public service — has been more difficult for the president’s critics to demonize than other programs, which they have framed as an attempt to force taxpayers to shoulder borrowers’ expensive education costs.

During Mr. Biden’s tenure, the Education Department has significantly streamlined and scaled up the use of the program, and its announcement on Thursday underscored that the new and more efficient version could be one of the few student debt cancellation programs to survive past Mr. Biden’s presidency.

“This is something that we’re extremely proud of, not only the number, but also that the process is fixed so that it can continue providing forgiveness for public servants for years to come,” Mr. Cardona said.

The White House also heralded the final tallies of other groups who received forgiveness on Thursday, in what is likely to be the Biden administration’s final appraisal of its progress before the presidential election in November.

The Education Department canceled some debt for around 1.6 million borrowers who it found had been cheated or misled by their schools, and an additional 1.4 million who qualified through repayment plans such as the SAVE program before it was tied up by legal challenges this summer.

The department has also approved around $16.2 billion in debt cancellation for nearly 572,000 borrowers with a total and permanent disability, a group that includes many veterans.

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