Staff Reports
The Biden administration made an announcement on Wednesday about canceling $6.1 billion in student debt for 317,000 borrowers who attended the Art Institutes. The Art Institutes is a for-profit art school that closed its campuses last year. The borrowers enrolled at any Art Institute campus between Jan. 1, 2004, and Oct. 6, 2017, will have their debt forgiven under this plan.
The Art Institutes, founded in 1969, provided degrees and certificates in graphic design and other programs. However, the school faced legal challenges, including fraud allegations and a loss of accreditation, which led to the closure of its campuses.
The Biden administration announced Wednesday it's canceling $6.1 billion in student debt for 317,000 borrowers who attended the Art Institutes, a defunct, for-profit art school that shuttered its campuses last year. https://t.co/qvHCZODyV1
— The Washington Times (@WashTimes) May 1, 2024
President Biden criticized the institution for misleading students and leading them into taking on significant debt without promising career prospects. Borrowers at the Art Institutes were supposed to have their federal loans canceled if a school was deemed predatory, as per a rule established by President Obama in 2016. Although this rule was set to take effect in 2017, it faced legal challenges and was later postponed, thus never taking effect during the Trump administration.
Following a U.S. Supreme Court ruling that deemed his initial attempt to wipe away college loans unconstitutional, Mr. Biden is now canceling the loan for Art Institute students through a new plan. This latest effort aims to attract young voters, especially amid polling data showing Biden trailing behind former President Donald Trump among young voters. This has raised concerns about Mr. Biden’s presidency being viewed as a failure, particularly among younger voters.
As part of his latest proposal, Mr. Biden is aiming to eliminate student debt by utilizing different legal authorities. Despite facing legal challenges, the administration is moving forward with its efforts to provide debt relief for borrowers at institutions such as the Art Institutes.
The Art Institutes were marketed as a more affordable option compared to traditional art schools, offering full degrees at a lower cost. However, the parent company of the Art Institutes faced legal action and settlement claims for predatory tactics and misleading practices.
In conclusion, the Biden administration’s decision to cancel student debt for Art Institute borrowers is part of the ongoing efforts to address student loan challenges. However, the move has sparked legal challenges and concerns among conservative lawmakers.
