Donald Trump started it. In March 2020 the former president froze federal student loan repayments as an emergency pandemic measure. Since then the payment pause has been extended eight times by two administrations. More than 40 million Americans haven’t had to pay a penny on their federal student loans for three years, and there was hope that the extensions would keep coming. Those hopes were dashed last week, however, when the White House confirmed that the pandemic emergency was over and payments will resume later this year.
So when is D-day? Bear with me here, because the US government doesn’t like making things simple. Payments are to resume 60 days after 30 June or, if it comes first, 60 days after the supreme court issues its ruling on whether or not president Joe Biden is allowed to follow through on his campaign promise of forgiving up to $20,000 of student loans for millions of borrowers.
There are a lot of things going on here, but the bottom line? Millions of Americans are about to be screwed. Nobody should have expected student loan payments to be deferred for ever, but when you extend something for more than three years, it is only natural for people to get used to that new normal. The cost of living has also ballooned in that time, and money that once went to repay student loans is now being spent on food and utility bills. Repayments are going to be very painful.
If Biden’s loan forgiveness plan is allowed to proceed, some of that pain will be mitigated. About 20 million borrowers will have their federal student loan debt wiped out; everyone else will see their monthly payments reduced. But Republicans are waging a multipronged attack on student loan forgiveness, so I wouldn’t bank on it happening. As well as bringing legal challenges, which are now being heard in the supreme court, Republicans have put forward legislation that would block forgiveness. A vote will be held on the legislation on Wednesday, and Biden has already said he will veto the measure if Congress passes it. Of course, if Biden does successfully veto it, something else will pop up. The one thing you can guarantee with Republicans is that they will fight like hell to advance their agenda.
While Republicans always seem to find a way to get what they want, Democrats have a reputation for squandering their power and getting nothing done. If Biden’s loan forgiveness plan falls through, a lot of young people (who support the policy more than the general population) may not forgive him, which may well be reflected in turnout at the 2024 election. Republicans might be the ones sabotaging forgiveness, but Biden campaigned on the issue; a lot of younger voters turned up at the midterms to support the Democrats, in part, because he promised student debt cancellation. Student loan forgiveness wouldn’t just provide direct financial relief, it would also, to quote Elizabeth Warren, “persuade a lot of young people that this president is in the fight for them”. Alas, as they demonstrate time and time again, Democrats don’t seem to like fighting.
It is a similar situation with Labour in the UK. Earlier this month Keir Starmer, abandoned his pledge to get rid of university tuition fees. Politicians obviously can’t be expected to make good on every promise, and must react to changing economic circumstances, but a U-turn on tuition fees looks a lot like a bait-and-switch for younger voters.
How we fix the fact that a university education has become a luxury item is complex. But what is very clear is that Democrats and Labour need to stop taking young people’s votes for granted and start earning them. One of Biden’s favourite sayings is: “Don’t compare me to the Almighty; compare me to the alternative.” Which is a slightly more eloquent way of saying: “We’re not great, but we’re better than the opposition.” A phrase that could pretty much be Starmer’s Labour’s official slogan. It is time for both parties to stand on more than being slightly better than the other guys.
• Arwa Mahdawi is a Guardian columnist
