Rep. Alexandria Ocasio-Cortez (D-NY) speaks during a news conference to discuss legislation that would strengthen Social Security benefits, on Capitol Hill October 26, 2021 in Washington, DC.
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- AOC told Yahoo Finance the student-loan payment resumption is a major risk to borrowers and the US.
- She added the argument Biden cannot cancel student debt “is not a legitimate argument.”
- Progressives continue to call on Biden to cancel student debt as he remains silent on the issue.
Student-loan payments are set to resume on May 1, and New York Rep. Alexandria Ocasio-Cortez is not on board with that plan.
President Joe Biden just extended the student-loan payment pause for a third time, and while Ocasio-Cortez was one of the lawmakers to laud that additional relief, she told Yahoo Finance’s Andy Serwer, in an interview to be released this week, that resuming those payments in a few months is a bad idea for not only borrowers, but the US economy.
“I cannot understate the danger and the risk — economically, politically, and just where we are right now as a country — of allowing the moratorium on student loan payments to lapse in May,” Ocasio-Cortez said.
“We are at such a delicate point in the financial and just general economic recovery post-COVID that to then re-start payments that are essentially the size of a mortgage payment, sometimes even larger, on a generation that was already so devastated … It could throw out of balance already what is a very fragile recovery,” she added.
Student-loan payments have been on pause for the duration of the pandemic to give 43 million borrowers with federal student debt a temporary reprieve. But the $1.7 trillion student debt crisis in the country continues to grow, and Ocasio-Cortez is one of the Democratic lawmakers who have been consistently pushing Biden to fulfill his campaign promise and cancel student debt for every borrower.
Ocasio-Cortez added that the idea Biden may not have the authority to cancel student debt broadly “is not a legitimate argument” — something Biden himself has questioned, prompting him to ask the Education Department to prepare a memo on his legal ability to cancel student debt broadly.
However, documents released in November indicated the Education Department completed the memo in April 2021 and has chosen not to make public whether it concluded that Biden can legally cancel student debt. Some lawmakers and advocates are growing frustrated.
Most recently, 85 Democratic lawmakers, including Ocasio-Cortez and Massachusetts Sen. Elizabeth Warren — who championed a $50,000 loan forgiveness proposal — called on Biden to not only release the memo, but to cancel up to $50,000 in student debt before payments resume on May 1.
But for now, Biden has not commented on when, or if, he plans to cancel student debt broadly and said in December that borrowers should “do their part” to prepare for the loan payment resumption.