(Bloomberg). — President Joe Biden is contemplating cancelling all student loans, despite the pressure of Democrats including Vice President Kamala Harriman, who want to get a win in midterm elections.

While he said last month that he’s considering “some debt reduction,” Biden has not made up his mind about many details of the plan, including how much debt to forgive per borrower, the people said. The White House has been debating the details of the forgiveness program for nearly a full year internally, but there’s no clear consensus.

White House Chief-of-Staff Ron Klain, and Bharat Ramamurti (Deputy Director of the National Economic Council), are just a few of the people urging Biden’s to declare some type of forgiveness for student loans.

The White House’s hesitance on the issue represents the latest fracture within the Democratic party, which Biden has failed to unite around his ambitious economic agenda. But this time it’s the Democratic rank-and-file who haven’t yet persuaded the president to use his power for broad loan relief.  

It is being viewed by supporters as having no political down sides. Numerous progressive legislators have called for the White House’s cancellation of at least $50,000 per borrower.

According to sources familiar with the internal discussions, Ramamurti is a former aide of Senator Elizabeth Warren and one of the most vocal advocates for a forgiveness program. According to Ramamurti, cancelling student debt is not only politically appealing but it also helps reduce US racial- and class inequities.

Biden’s reservations center on both the legality of canceling debt through executive action and whether broad forgiveness would be good policy, the people said. According to one White House official, he supports Congress passing legislation that would allow each borrower to forgo $10,000 of debt.

They asked not to identify the people discussing internal deliberations.

“The consideration of what you can do with executive authority and action, it always takes a long time,” White House Press Secretary Jen Psaki told reporters Thursday at a breakfast hosted by the Christian Science Monitor. “And there are significant policy questions here — good policy questions.”

Laying the foundation

While some in the education community are skeptical of Biden’s commitment to forgiving student loans, regarding him as having been pushed to support the idea by Warren and other liberal opponents in the 2020 Democratic primary, the government has been laying groundwork for the move since he took office.

Administration policy experts have spent many months studying the options available for forgiveness programs, such as income requirements, graduate school loans and only undergraduate debt. They also consider how this would affect people who borrowed money for school, but did not receive a degree.

Biden issued a directive to the Justice and Education departments more than one year ago to assess the extent to which he could forgive student debt. The Education Department recently released a year-old “pre-decisional & deliberative” legal memo on the issue, but fully redacted its text. 

Those six blank pages are only fueling speculation about the administration’s plans as midterm elections approach in November.

According to an Education Department spokesperson, the government wants long-term reforms that make college more affordable. Officials are also considering other executive options. 

Officials from the National Economic Council and Council of Economic Advisers have been working on plans within the White House. Susan Rice, the DPC director, isn’t among officials pushing Biden for any sweeping move, two of the people said. 

Biden has sought to aggressively expand higher education options for lower- and middle-income people, proposing as part of his “Build Back Better” economic plan to make community college free and expand Pell Grants, which help pay for college for the lowest-income Americans.

But he didn’t include loan forgiveness in the plan, preferring that Congress devise a program on its own.

Democrats favoring loan forgiveness are pressing Biden more to ease some of the debt by taking executive action, despite lawmakers being in impasse on nearly all matters.

White House officials have said Biden is considering forgiving at least $10,000 in federal loans per borrower, and have signaled that people making more than $125,000 a year likely wouldn’t be eligible. An income limit, according to legal experts, would make it more difficult for an executive order in court.

‘Jubilee for Elites’

Republicans have assailed loan forgiveness as a potential fresh driver of inflation and unfair to people who’ve paid off their student debts. Senate Republican Leader Mitch McConnell has labeled student loan cancellation “a jubilee for elites” and Republicans in the House and Senate have introduced symbolic legislation that would block Biden from forgiving loans through executive action.

The Democrats are supportive of loan forgiveness. Even Joe Manchin, the West Virginia senator who has stalled Biden’s economic agenda in the evenly divided Senate, has said he supports at least some relief.

There are approximately 43 million Americans with outstanding federal student loans. Their average balance is greater than $37,000. According to Education Data Initiative, the majority of debt is owed to households with higher incomes. 

Black college graduates have an average student loan balance of $25,000 higher than White graduates. 

A poll by Politico/Morning Consult found that 64% of voters supported at least partial student loan forgiveness. Only 5% of respondents said that education, including student loans, was their top concern for the midterms. 

Many legal experts, even those once skeptical of Biden’s authority, have concluded that he can order at least some loan forgiveness. It is unclear how broad his power is and what source it comes from.

A provision of the Higher Education Act gives the secretary of Education authority to “compromise, waive or release the department’s claims against student borrowers.” 

Biden could also be empowered by a 2003 law to allow the Education secretary forgiveness of federal student loan debt in emergencies such as the Covid-19 pandemic. Luke Herrine (incoming assistant professor of Law at the University of Alabama) and Jonathan Glater (an incoming law professor at California’s University of California, Berkeley) said that.

Mark Kantrowitz, an expert in financial aid, stated that either one of these laws could be used to create a wide-ranging forgiveness program. However, it would likely face a legal challenge in court. Kantrowitz suggested that Biden could instead modify the existing repayment plans, reducing the forgiveness period (now usually 20-25 years) and changing income caps. This would likely avoid a legal challenge.

It’s unclear who would have standing to sue over a forgiveness program, though plaintiffs might include members of Congress or loan servicing companies that hold federal contracts and risk a financial loss.

Progressives say there’s precedent for a forgiveness program, as both the Trump and Biden administrations paused repayments on student loans and interest accrual during the pandemic. Biden has not allowed payments to be resumed and has cancelled $18.5 million in student loans. This includes more than $5.8B for students with severe disabilities.

“It’s clear they have the power; they’ve been using it,” Warren said last week.

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