Daily Political Briefing
Aug. 6, 2021, 4:35 p.m. ET
WASHINGTON — The Education Department announced Friday that it would continue a moratorium on federal student loan payments through Jan. 31, 2022, extending emergency relief for millions of borrowers that had been set to expire next month.
The department said that this would be the “final extension” of the pause, which the Trump administration instituted in March 2020 at the outset of the coronavirus pandemic, and that the additional time would allow the agency to transition borrowers back into repayment and reduce the risk of default and delinquency.
“The payment pause has been a lifeline that allowed millions of Americans to focus on their families, health and finances instead of student loans during the national emergency,” Education Secretary Miguel Cardona said in a statement. “As our nation’s economy continues to recover from a deep hole, this final extension will give students and borrowers the time they need” to plan to resume payments.
Several Democratic leaders in Congress had pressed the Biden administration over the summer to continue the student loan pause, saying that the fast-approaching expiration was ill-timed considering that millions were still suffering financial hardship from the pandemic.
“Since the beginning of the Covid-19 pandemic, millions of Americans have struggled to keep a roof over their heads, pay bills and put food on the table,” the heads of the Senate and House Education Committees, Senator Patty Murray of Washington and Representative Bobby Scott of Virginia, wrote in a June letter. “While the economy has begun to show promising signs of recovery, more than nine million Americans remain out of work, and the economic and health disparities created by the pandemic are severe.”
They also wrote that the pause had helped borrowers “cover essential expenses during the pandemic and during ongoing recovery efforts.”
The Federal Reserve Bank of New York estimated that the pause saved borrowers $7 billion per month in payments, according to the letter from Ms. Murray and Mr. Scott, and the Education Department estimated that borrowers saved about $5 billion per month on loan interest.
Notably, the Education Department emphasized that January 2022 was a “definitive end date,” as the Biden administration faces mounting pressure from Democrats to erase up to $50,000 in federal student loan debt.
In a joint statement, Democratic Senators Chuck Schumer of New York, the majority leader, and Elizabeth Warren of Massachusetts and Representative Ayanna Pressley, Democrat of Massachusetts, all of whom have pushed for President Biden to cancel student loan debt by executive order, said the pause “provided an enormous relief to millions of borrowers facing a disastrous financial cliff” but didn’t go far enough.
“Our broken student loan system continues to exacerbate racial wealth gaps and hold back our entire economy,” the statement said. “Student debt cancellation is one of the most significant actions that President Biden can take right now to build a more just economy and address racial inequity. We look forward to hearing the administration’s next steps to address the student debt crisis.”
Presidencies are governed by events and priorities, and President Biden — propelled into office by epochal events in 2020 — has staked his political fortunes on passage of a $1 trillion infrastructure bill intended to demonstrate his competence, can-do attitude and commitment to bipartisanship.
On Friday, the capital paused on the cusp of fulfilling one of Mr. Biden’s top first-year legislative priorities to mark the passing of former Senator Mike Enzi of Wyoming, a conservative who retired last year and who died from injuries sustained in a biking accident. He was 77.
Senator Mitch McConnell, Republican of Kentucky and the minority leader, and several other senators traveled out West on Friday for the funeral service in an auditorium located on Enzi Drive in Mr. Enzi’s hometown, Gillette. The group planned to return to Washington for a series of votes expected over the weekend.
After a round of wrangling on Thursday, Senator Chuck Schumer, Democrat of New York and the majority leader, announced plans to hold a critical procedural vote on Saturday on the infrastructure measure, which includes a huge infusion of federal funding for the country’s aging public works system.
About an hour after the Senate convenes at 11 a.m. Eastern on Saturday, the chamber is expected to take up the first of two expected test votes, in which the support of at least 60 senators is needed to end debate. A final vote on the bill could come as early as that afternoon, or senators could consider additional changes to the measure, pushing the debate into next week and delaying the Senate’s summer recess.
Aides from both parties said they believed the Senate measure would almost certainly pass at some point.
The question is whether Mr. McConnell or other Republicans will insist on allowing debate to drag on for the 60 hours permitted under Senate rules.
Over the past week, the Senate debated and voted on 22 amendments, some of them bipartisan measures that passed with 60 or more votes, a positive sign for overall passage of the bill.
Mr. McConnell has not fully endorsed the legislation, but he has not blocked it either and has suggested he might ultimately be in favor.
“There’s an excellent chance it will be a success story for the country,” he told reporters on Tuesday.
The bill cleared an important political hurdle on Thursday: There appeared to be no significant erosion of Republican support after an estimate from the nonpartisan Congressional Budget Office found that the legislation would increase the deficit. The office calculated that nearly half of the new spending — $256 billion — would be financed by adding to the nation’s debt from 2021 to 2031, contradicting the claims of Republican and Democratic proponents that the measure would fully pay for itself.
The flurry of activity came after three days of plodding work on the package, which would provide $550 billion in new money to rebuild the nation’s crumbling roads, bridges and rail systems and fund new climate resiliency and broadband access initiatives.
The Democrats’ goal is to vote on the infrastructure bill quickly, then proceed to a $3.5 trillion budget resolution that will contain many of the progressive policy priorities that were omitted from the bipartisan plan, including major expansions of education, health care, child care and paid leave programs, as well as measures to confront climate change.
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As Taliban fighters make startlingly swift advances across Afghanistan, Biden administration officials continue to pin their hopes on a peace deal that would halt the country’s relentless violence with a power-sharing agreement.
They have said, at least in their public statements, that the peace process could succeed, even as the U.S. military withdraws from the country and as critics say the talks should be declared a charade and scrapped.
But now even the most encouraging U.S. officials increasingly concede in public what they have previously said in private: that the prospects of a negotiated outcome, which could partially salvage the 20-year American project in Afghanistan, appear to be fading fast.
President Biden’s special envoy for Afghanistan, Zalmay Khalilzad, offered a downbeat assessment of what he called the “difficult situation” in the country and the wide gaps between Taliban and Afghan government negotiators.
“They are far apart,” Mr. Khalilzad said during an appearance at the annual Aspen Security Forum on Tuesday. Privately, U.S. officials are even more pessimistic.
The prospect of a peace deal gives Biden administration officials something hopeful to point to amid charges that, by withdrawing troops from the country, they have abandoned America’s Afghan allies to Taliban conquest and severe theocratic rule.
But officials have struggled in recent weeks to deflect fears that the Taliban have cynically exploited the peace talks to buy time and provide political cover for a U.S. exit.
“Taliban leaders continue to say one thing — namely, that they support a negotiated solution with conflict,” Ned Price, the State Department spokesman, said on Wednesday, adding that “those words ring hollow” amid the continuing attacks.
The Taliban have captured the capital of one of Afghanistan’s western provinces, Afghan officials said on Friday, a symbolic milestone in the insurgents’ relentless march to retake power in the country.
Zaranj, the provincial capital of Nimruz on the Afghanistan-Iran border, has collapsed and is now in the hands of the insurgents, according to Rohgul Khairzad, the deputy governor of Nimruz, and Haji Baz Mohammad Naser, the head of the provincial council.
It is the first provincial capital to be captured by the Taliban since the Biden administration said it would completely withdraw American troops from Afghanistan by next month. The Taliban have besieged a host of such cities for weeks, and the likely fall of Zaranj, a city of 160,000 people, is their first major breakthrough.
The city fell on the same day that a senior government official was assassinated in Kabul, the capital, and the insurgents pressed hard into other provincial cities.
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The Biden administration is still struggling to provide consistently good care for migrant children.
At an emergency shelter in the Texas desert, migrant teenagers are housed in long, wide trailers, with little space for recreation and not much to do during the hot summer days, according to lawyers and other advocates for the children who have visited them there.
Some of the children say they wait more than a month before meeting with someone who can help connect them with a family member or other sponsor in the United States. Some report episodes of food poisoning and say they have to wash their clothes in a bathroom sink.
The living conditions for migrant children who arrive unaccompanied in the United States and are taken into custody appear to have improved since the early spring, when images of them crammed into Customs and Border Protection facilities drew criticism from around the world. But accounts from people who are able to visit the emergency shelters — where the children are sent while waiting to be released to family, friends or better-equipped, state-run facilities — suggest that the Biden administration and the private contractors hired to run the facilities are still struggling to provide consistently good care.
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Hiring accelerated last month.
Cumulative change in jobs since before the pandemic
The American economy roared into midsummer with a strong gain in hiring, but there are questions about its ability to maintain that momentum as the Delta variant of the coronavirus causes growing concern.
Employers added 943,000 jobs in July, the Labor Department reported Friday, but the data was collected in the first half of the month, before variant-related cases exploded in many parts of the country.
While the economy and job growth overall have been strong in recent months, experts fear that the variant’s spread could undermine those gains if new restrictions become necessary. Already, some events have been canceled, and many companies have pulled back from plans for employees to return to the office in September.
Still, with schools planning to reopen, at least for now, and Americans continuing to dine out and travel, the economy’s expansion remained on track last month. Some experts foresee a slight cooling on the horizon, but most think unemployment will keep falling as the labor market recovers the ground lost in the pandemic.
“Sectors tied to the reopening of the labor market are leading the way, giving some hope that these gains can continue in the months ahead,” said Nick Bunker, economic research director at Indeed Hiring Lab. “However, the Delta variant does pose a risk to the pace of progress.”
It was the best monthly performance since August 2020, and underscored how far the recovery has come, at least until the Delta variant appeared on the scene.
In remarks delivered from the White House, President Biden hailed the report as a sign that the economy could weather the pandemic, crediting in part his administration’s efforts to encourage workers to get coronavirus vaccinations.
“We will doubtless have ups and downs along the way as we continue to battle the Delta surge of Covid,” Mr. Biden said. “What is indisputable now is the Biden plan is working, the Biden plan produces results, and the Biden plan is moving the country forward.”
The unemployment rate fell to 5.4 percent, compared with 5.9 percent in June. Before the report, the consensus of economists polled by Bloomberg forecast a gain of 858,000 jobs, with the unemployment rate dipping to 5.7 percent.
“This is a great report, very solid in terms of job growth, wage growth and the decline in the unemployment rate,” said Gus Faucher, chief economist at PNC Financial Services in Pittsburgh. “I don’t see the Delta variant derailing the recovery.”
The unemployment rate notched down in July.
The share of people who have looked for work in the past four weeks or are temporarily laid off, which does not capture everyone who is out of work because of the pandemic
The education arena, often a laggard in July as schools close and teachers go off the payroll, was a leader last month. Instead of letting teachers go as they have in the past, schools kept more workers on the payroll, creating a larger seasonal adjustment upward in the number of teaching jobs.
Local government added 221,000 education jobs, after a jump in June, and 40,000 jobs were added in private education. Leisure and hospitality businesses, which were hit hard by lockdowns last year, recovered further, adding 380,000 jobs. That included 253,000 in food and drinking establishments, along with hiring gains in lodging and in arts, entertainment and recreation.
Manufacturing and construction showed more modest increases, hampered by higher goods prices and a shortage of components like semiconductors. Employment in professional and business services jumped by 60,000, a sign that the white-collar sector is on the upswing.
What’s more, upward revisions for May and June rounded out the positive picture, with the Bureau of Labor Statistics lifting the gain for May by 31,000 and the increase in June by 88,000.
Jobs grew across industries, except in retail.
Cumulative change in jobs since before the pandemic, by industry
“Business is unbelievable,” said Tom Gimbel, chief executive of LaSalle Network, a recruiting and staffing firm in Chicago. “Companies are continuing to hire salespeople in numbers that I’ve never seen. It shows me that companies are very optimistic about the future.”
“We’re seeing demand for senior people, but it’s not crazy,” he added. “The huge demand is entry to midlevel, with salaries ranging from $45,000 to $90,000. It’s the rebirth of the middle manager.”
Despite the hiring gains, many managers report difficulty in finding applicants for open positions. Jeanine Lisa Klotzkin manages an outpatient addiction treatment center in White Plains, N.Y., and has had only limited success in her search for addiction counselors.
“Normally, we’d have dozens of candidates,” she said. But six weeks after posting an online job ad, her clinic has received four applications. The positions pay $50,000 to $63,000 a year, said Ms. Klotzkin, who added: “These aren’t low-wage jobs. I don’t know where the people went.”
Katie Rogers contributed reporting.
After a lengthy delay, the Census Bureau will release the data used to redraw congressional and state legislative boundaries on Thursday, the agency said in a statement, setting up what is certain to be a highly contentious nationwide fight over redistricting before the midterm elections next year.
The census data had been delayed largely because of difficulties in collecting and processing the enormous amount of information amid the coronavirus pandemic, but also because of efforts by President Donald J. Trump to meddle with the census by adjusting its timing.
The pandemic and Mr. Trump’s actions — he also sought to add a citizenship question — have left some people questioning the count’s accuracy. The debate over the citizenship question, in particular, has raised worries about possible suppression of the participation of Latino communities.
The delay forced many states to delay their redistricting plans, which will most likely lead to a compressed, scrambled process with elevated stakes. There is growing belief in Washington that the balance of power in the House of Representatives after the 2022 midterm elections will depend largely on the results of the redistricting process.
Multiple battleground states, including Florida, Texas and North Carolina, are set to gain at least one new congressional seat, as are Colorado, Montana and Oregon. Seven states will lose a seat: New York, California, Ohio, Michigan, Pennsylvania, West Virginia and Illinois.
Potential House and Senate candidates have also been forced to keep their political ambitions frozen in amber as they wait to see whether redistricting will affect their ability to hold on to a current seat, open up an opportunity to run for a newly drawn seat, or otherwise change their calculus for seeking a particular office.
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