COLUMBUS, Ohio – President Joe Biden’s administration has picked Richard Cordray to oversee federal student loans.
Cordray, who previously led the Consumer Financial Protection Bureau, will serve as the chief operating officer of Federal Student Aid, a key role managing a $1.5 trillion portfolio as progressives push Biden to cancel student loan debt.
Massachusetts Sen. Elizabeth Warren, an ally of Cordray’s, praised the pick, saying on Twitter: “I’m very glad he’ll be protecting student borrowers and bringing much-needed accountability to the federal student loan program.”
More:Will Biden cancel student loan debt? As college costs spiral, here’s what he’s considering
U.S Secretary of Education Miguel Cardona said Cordray had a strong track record as a public servant: “I am confident that under his leadership, Federal Student Aid will provide the kind of service that our students, families and schools deserve.”
Cordray is known in Ohio for serving as the state’s attorney general and treasurer. In 2018, he ran against then-Ohio Attorney General Mike DeWine, ultimately losing the governor’s race.
More:The student debt crisis is crushing Black Americans. Here’s how loan forgiveness could help
Cordray recently released a book titled “Watchdog: How Protecting Consumers Can Save Our Families, Our Economy, and Our Democracy” about his time at the CFPB.
Biden’s plan for student loan debt
Though Biden has been hesitant to bypass Congress on canceling student loan debt, he has said since the days of his campaign that the government needs to help those with “debilitating” student debt.
“I understand the impact of debt,” he said at a CNN town hall in February.
Under Biden, the Department of Education has canceled student debt for borrowers who have disabilities. And the federal government suspended federal student loan payments during the COVID-19 economic crisis through Sept. 30.
Economists, social justice activists and Democratic leaders in Congress pushing Biden to forgive federal student loan debt have argued that doing so would help address centuries of racist economic policies, including labor and housing discrimination, that continue to make it difficult for Black Americans to acquire wealth at the same rate as white Americans.
While about 44 million Americans owe a total of $1.7 trillion in student debt, Black Americans on average owe nearly twice as much debt as white Americans, and more than Asians and Latinos. Black borrowers, who earn less, are also less likely to pay off their debt and most likely to be behind on payments, according to the Federal Reserve.
Biden officials also have backed forgiveness up to $10,000 in federal student loan debt per person, which falls short of the $50,000 that progressive lawmakers have sought.
Contributing: Cristina Silva, Jeanine Santucci