President Biden’s plan to bail out student loan borrowers is once again stuck in limbo after a panel of higher education experts could not agree on a skinnier version of student debt relief.

Democrats now warn that recent proposals don’t go far enough to help millions of Americans in need.

The Biden administration initially proposed a $400 billion program to erase up to $20,000 in federal student loan debt for roughly 40 million borrowers. But that program was struck down by the Supreme Court in June, claiming that the president overstepped his authority.

Following the decision, the Education Department convened a panel of experts to negotiate a hollowed-out version of the program—one that’s much smaller in scope.

But even they failed to reach a consensus on who should be eligible for relief and how much they should receive.

As The Washington Post reported, the panel clashed over placing a cap on forgiveness, how to classify borrowers living below the poverty line, and what constitutes “financial hardship.”

According to progressive Democrats, though, the panel is negotiating over breadcrumbs when the real issue is a lack of funding.

Senate Majority Leader Chuck Schumer, Sen. Elizabeth Warren, Sen. Bernie Sanders, and other policymakers penned a letter to Education Secretary Miguel Cardona urging his agency to maximize debt relief.

They complained that the current draft proposal “would fall far short of providing the full scale of debt relief that low- and middle-income Americans urgently need.”

They recommended that the Education Department expand eligibility and increase the amount of forgiveness borrowers would receive. This includes eliminating all debt that exceeds the original principal balance and providing full cancellation for borrowers who’ve paid down their original principal loans.

“This rulemaking process presents a significant opportunity to address pervasive problems within the student loan system by fortifying the authority to waive debt, in order to ensure that postsecondary education becomes accessible to all students,” the lawmakers wrote.

An Education Department spokesperson said the agency welcomes the lawmakers’ inputs as it formalizes a new student debt relief proposal, which is expected to be introduced in May.

Introducing a proposal is one thing; getting it passed is another.

Bottlenecks remain

There’s no guarantee that a skinnier version of Biden’s $400 billion student debt relief program will be approved.

As Politico reports, Republicans and conservative groups have vowed to block Democrats’ attempts to erase large amounts of student debt.

In August, two conservative groups filed a lawsuit against the Biden administration for its plan to forgive $39 billion in student loans for more than 800,000 borrowers.

These groups even argued that Biden’s plan undermines Public Service Loan Forgiveness—a program that discharges student loan debt for borrowers in low-paying public-sector careers.

The conservative-leaning Supreme Court presents another bottleneck should the Biden administration try to sidestep Congress with any future proposal.

Student loan forgiveness is expected to be a politically charged topic during the 2024 election cycle. The problem for Biden is that Americans are largely split on the issue.

According to an Ipsos/USA Today poll earlier this year, 47% of Americans supported Biden’s initial debt forgiveness plan, whereas 41% opposed, and 12% were unsure.

Borrowers drown in debt—and in payments

Outstanding student loan debt increased by $30 billion in the third quarter, reaching a new record of $1.6 trillion, according to Fed data. The average borrower owes $37,338 in federal student loan debt—a figure that jumps to nearly $55,000 for private school attendees.

Borrowers received financial relief during the pandemic when student loan payments were paused temporarily. But payments resumed in October, affecting some 44 million Americans.

As Creditnews reported, average monthly payments on federal student loan debt range between $200 and $500.

The one silver lining for student loan borrowers is that the government has made it easier to file for bankruptcy and discharge their debts. According to NPR, nearly 7 million borrowers are in default, meaning they haven’t made a payment in at least 270 days.

The bad news is filing for bankruptcy has severe consequences that could live on borrowers’ records for up to ten years.