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Student loan forgiveness

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President Biden is proposing $10,000 in student loan forgiveness and many Democrats are pushing for at least $50,000, which would completely eliminate the burden of three in four borrowers. I’m conflicted regarding student loan forgiveness, mainly because I’m unclear on whether student loan forgiveness is the best way to address the consequences of the exorbitant costs of higher education. Will student loan forgiveness stimulate the economy? Help the younger generations have the same lifestyle as the older generations? Help correct for racial disparities? Make voters happy?

Clearly, there is a problem with the cost of education in the US and how it has been funded. Millennials are on track to be the first generation in modern history to end up poorer than their parents. Student loans are delaying retirements. They are suppressing the housing market and suffocating new business creation. They are leading young people to delay getting married and having children. They are also widening the country’s racial wealth gap because a higher share of Black college students take out loans and those loans tend to be bigger because Black students have access to less familial wealth.

So why not forgive student all loan debt? One concern is student loan forgiveness helps the wealthy rather than the poor. A majority of student-loan debt is held by Americans toward the top of the income scale, with 56 percent held by those with graduate degrees. Should the government be giving more money to the people who have access to the most lucrative jobs?

There is also the concern that student loan forgiveness is not fair. It is unfair to people who paid off their student loans; unfair to people who will take them out five or 10 years from now; unfair to people who declined to take them out and worked their way through school; unfair to people who chose community college instead of a private institution; unfair to people with private student-loan debt that the federal government could not disappear without an act of Congress.

Another concern with across-the-board student loan forgiveness is that, in the absence of other reforms, forgiving debt sets a precedent. Student borrowers (and the colleges they attend) may rightly expect another cancelation to happen at some point in the future when outstanding debt again climbs too high. This creates an incentive to borrow more in order to take advantage of that future jubilee and it gives colleges another reason to hike tuition.

I would like to see some kind of student loan forgiveness even if it is a Band-Aid fix. My preference would be targeted student loan forgiveness that is passed by Congress rather than executive action. There need to be eligibility requirements that target the lower-income borrowers. I would also prefer forgiveness for more undergraduate loans rather than graduate loans. I would like to see student loan forgiveness for all students who attended historically black colleges and universities, which have been underfunded for decades.

What are your thoughts?

I haven't been able to come up with a good set of thoughts for this question. I have about 10k in student loan debt myself, but I can afford to pay it back and plan to do so. Not everyone is in that situation. I understand how easy it is to rack up crazy debt, and so many of my coworkers (with medical doctorates) pay half their salaries back to loan companies and will continue to do so for at least 15-20 more years.
It's a weird conundrum because people cant get jobs without college degrees or trade certs, so college/trade school is almost a necessity. Loan forgiveness seems like a solution at the wrong end of the problem for me, but I support it. I think.

Gawdzilla Sama:
I had over $100,000 U$D written off when I graduated with my MA. All I had to do was work for the government for free, which I had already been doing.

Regarding 'fairness' in your fourth paragraph...

I'll respond in kind as I do to those in my team. Namely: is that a reason not to do it? If you can either help person a or neither person a nor b, is the fact that you can't help person b really a reason not to help a? Really?
My social workers have to work in a - personcentric fashion. They have to struggle to get exceptions through, to help those people. They Caan never get everyone out of the margin of society. But it is their job to get as many of those that they can. Sorry to those that we inevitably fail. And I will always try to support new and better ways to reach more people in significant matters.
But for Pete's sake. Imagine you had a doctor who said: I could cure your cancer, but it's not fair to those with incurable cancer or those who had it before  our medicine got more advanced. Madness, innit?


--- Quote from: Gawdzilla Sama on March 02, 2021, 01:32:18 PM ---I had over $100,000 U$D written off when I graduated with my MA. All I had to do was work for the government for free, which I had already been doing.

--- End quote ---

That's great!

I didn't take any loans for my undergrad degree but from 1992-94 I borrowed $28K to go to graduate school. It took 10 years to pay it off.

--- Quote from: Mr.Obvious on March 02, 2021, 01:49:17 PM ---Regarding 'fairness' in your fourth paragraph...

I'll respond in kind as I do to those in my team. Namely: is that a reason not to do it?

--- End quote ---

Clearly I agree because I do think there should be some form of loan forgiveness. However, I don't see this as helping person A or person B. As Mermaid said, student loan forgiveness is a solution at the wrong end of the problem. It's like the roof is leaking and rather than repairing the roof we're buying bigger buckets. Instead of forgiving loans we could make tuition at state universities free.


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