money AOC to struggling student loan borrower: 'Don't lose hope!'
House Representative Alexandria Ocasio-Cortez (D-NY) urged Instagram users to be optimistic as millions of Americans worry about student loan debt amid the coronavirus pandemic.
“Do you think student loan forgiveness [is] ever happening,” one person asked Ocasio-Cortez, known as AOC, through an Instagram question-and-answer feature. “I have started to [lose] hope.”
The post came days after Democrats re-introduced a resolution to call on President Joe Biden to cancel $50,000 in student loan debt through an executive order.
“Don’t lose hope!” Ocasio-Cortez stated in a story in response. After reminding them that payments have been suspended until the end of September 2021, AOC added: “Long term we must forgive” and “the Biden admin NEEDS to be pushed.”
Ocasio-Cortez said that the Biden administration has indicated that it’s “comfortable” with cancelling $10,000 in student debt — though whether any forgiveness would be done through executive action as opposed to legislation is unclear.
AOC added that “we NEED at least $50k minimum and there is support for 50k. We cannot take no for an answer. This will all come down to public pressure. We have a window to ORGANIZE and rally for your public officials to demand forgiveness.”
The prominent representative also stated that many “powerful people” exist who “WANT you to lose hope so you give up trying and they don’t have to deal with people organizing for change.”
Lobby groups and conservative voices generally oppose cancellation. Former Education Secretary Betsy DeVos characterized debt forgiveness as a “truly insidious notion of government gift giving.”
‘We can win’
Activists lauded her efforts to keep the pressure on the Biden administration to get cancellation.
“Rep. Ocasio Cortez is right,” Melissa Byrne, an activist who has been campaigning for student debt cancellation, told Yahoo Finance. “We need to fight for full student loan cancellation. And we can win.”
Nearly $1.7 trillion in student loan debt is held by roughly 43 million Americans. Payments and interest on federal loans have been paused since March 2020, when the pandemic first started spreading in the U.S.
While Ocasio-Cortez noted the payment suspension on federal student loans, there are many who haven’t been able to take advantage of that benefit, Alexis Goldstein, a senior policy analyst at Americans for Financial Reform, told Yahoo Finance. These include borrowers with federally-held but commercially-backed loans, as well as private student loans.
Goldstein stressed that the country is “still experiencing massive economic shocks from the pandemic.”
According to one study from 2019, the benefits of debt cancellation are cascading: When a group of borrowers had been relieved of their student debt, they started deleveraging by reducing their reliance on credit other bank accounts, and were also more likely to move, change jobs and also experience a significant increase int heir income.
Goldstein added that cancelling student debt via executive action “is a pragmatic tool the admin could use immediately to stimulate the economy while they continue to push for the American Rescue Plan.”
Aarthi is a reporter for Yahoo Finance. She can be reached at aarthi@yahoofinance.com. Follow her on Twitter @aarthiswami.
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