U.S President Joe Biden announced on Wednesday that he is cancelling $10,000 of federal student debt for certain borrowers earning less than $125,000 a year and up to $20,000 for Pell Grant recipients. By keeping a pledge he made in the 2020 campaign for the White House.
The action he took could boost the support for his fellow Democrats in the November congressional elections. However, some economists said it may fuel inflation and some Republicans in the U.S. Congress questioned whether the president had the legal authority to cancel the debt.
The actions are “for families that need them the most, working and middle-class people hit especially hard during the pandemic,” Biden said during remarks at the White House. He pledged no high-income households would benefit, addressing a central criticism of the plan.
“That’s why nearly 90% of the relief provided through my Administration’s action on student loan debt relief will go to folks making less than $75,000 a year,” he added.
