Leave ’em a-loan!
Chuck asks Joe to extend student debt freeze
Senate Majority Leader Chuck Schumer (D-N.Y.) called for a fresh extension of the nation’s student loan payment moratorium on Monday, pointing to uncertainty around the omicron coronavirus strain and ongoing financial insecurity felt by millions of Americans.
The White House extended the pause in August at the urging of Schumer and other Democrats, but said at the time that the freeze would not be extended again. The moratorium is due to end Jan. 31.
Schumer was set to embark upon a pre-Christmas campaign in Washington to rally support for extending the moratorium for more than 40 million debtors, including an estimated 2.4 million New Yorkers.
He has so far unsuccessfully lobbied President Biden to forgive $50,000 in federal student loan debt per borrower, but led a triumphant charge for the previous payment pause extension.
“We want the country to ultimately cancel student debt, but in the meantime, extend the pause.” Schumer said in a Midtown news conference Monday morning. “The pause must prevail.”
The moratorium, which suspended payments and set interest rates at 0%, was first implemented in March 2020, as the coronavirus crisis first crushed the American economy. Twenty-one months later, the country remains hobbled in significant ways.
As he made his case for an extension on Monday, Schumer rattled off figures from the Student Debt Crisis Center. In surveys conducted last month, the nonprofit found that almost nine-in-10 fully employed student loan borrowers said they did not feel financially secure enough to resume making payments at the start of February.
“This debt is just overwhelming for people,” Schumer said. “If we don’t extend the pause, interest rates just pile up. Students owe a fortune. And with omicron here, we’re not getting out of this as quickly as we’d like.”
The survey results, which included 33,703 responses, came from polling between Nov. 1 and Nov. 14, according to the Student Debt Crisis Center. Omicron was not identified until Nov. 25, and was first discovered in New York State on Thursday.
The heavily mutated coronavirus strain, which spreads quickly and may partially evade vaccine protection, has now turned up in more than a dozen states and threatens to interrupt the nation’s pandemic recovery.
On Monday, Schumer was organizing a letter to send to Biden and reaching out to members of Congress for their support, said Angelo Roefaro, his spokesman.
Schumer banded in June with Sen. Elizabeth Warren (D-Mass.), Rep. Ayanna Pressley (D-Mass.) and Rep. Joe Courtney (D-Conn.) to call for the pause to last into the winter. The four led a letter signed by more than 60 lawmakers.
Biden said in an Aug. 6 statement that he was extending the pause “one final time” and that the U.S. had “tools that will allow us to beat COVID-19 and keep our economy recovering at a record rate.” In its own statement that day, the Education Department described Jan. 31 as a “definitive end date.”
The White House didn’t immediately respond to a request for comment on the latest push on Monday.
Coronavirus case counts were climbing nationwide even before the ominous omicron development. But it’s not clear how the changing course of the pandemic will impact the economy.
The national unemployment rate sank to 4.2% in November, approaching prepandemic lows. And the Dow Jones industrial average has surged after a post-Thanksgiving swoon unleashed by omicron.
Still, the specter of the strain could cut into holiday gains for the economy, and unleash broader havoc. Schumer highlighted the possible turbulence as he argued for the loan payment pause to be extended.
“Don’t make kids and young adults pay while we still have a pandemic going,” Schumer said. “It’s too much of a burden.”