Will Biden cancel student loan debt? As college costs spiral, here's what he's considering

[DonViejo]

President Joe Biden has directed his education secretary to explore his authority to cancel student debt by executive order.

Jeanine Santucci, USA TODAY
Published 5:00 AM EDT Apr. 4, 2021 Updated 5:00 AM EDT Apr. 4, 2021

WASHINGTON — The Biden administration entered the White House with an eye toward relieving the strain of student loan debt, particularly amid the added financial burden of the coronavirus pandemic.

On day one in office, President Joe Biden signed an executive order extending a pause student federal loan payments enacted by the previous administration as part of COVID relief. Progressive activists and lawmakers have urged the president to go further and cancel student loan debt, but he has said firmly that he does not believe he has the authority to do so by executive order.

That changed Thursday, when White House chief of staff Ron Klain said that Biden asked his education secretary to explore the president’s authority to cancel student loan debt, a sign he is open to moving left on the issue.

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Critics of student loan debt forgiveness, including conservatives and some liberals, argue that it would unfairly benefit higher-income earners with college educations, and that individuals who took out loans have a responsibility to pay them back, regardless of circumstance.

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https://www.usatoday.com/in-depth/news/politics/2021/04/04/president-joe-biden-considering-student-loan-forgiveness/7006659002

[DenaliDemocrat]

1. How about we lower the interest rate on them?

It used to be they were 2.0% or lower. Now I can get a better rate on a credit card.

[Piratedog]

2. How about zero interest as long as you are paying back in good faith?

If you default, you gather some interest.

[Voltaire2]

6. Oh fabulous idea. If you are unable to pay

you get hit with a huge additional bill.

[3Hotdogs]

3. --- just restore the ability to bankrupt yourself out of it.

[Politicub]

4. If he's publicly exploring the idea, then I would suspect this will happen.

And it will be up to a certain amount.

I think $50k is good because that’s about what it would cost for tuition, fees and books for a four-year degree from a state college.

It needs to come with policy that will keep tuition in check at public universities. Private schools are more troublesome for tuition control because they’re, well, private.

[WhiskeyGrinder]

12. Uh have you looked at state university costs lately?

[Politicub]

21. A little, but not enough. I like the state-college cost guideline, though. It

sounds like it will need to be revised up.

[Arazi]

16. $50k for 4 years was at least a decade ago. More like $80 - $90k now

That's for in-state tuition, fees and books for a state university

[Voltaire2]

5. Great idea. Another way government for the people

can make a huge difference for millions of people.

The more we do now to directly improve people’s lives, the better we will do in 2022.

Also the critics should take a step back and stop moralizing about debt forgiveness or the unfairness of programs that don’t impact everyone the same. Wtf.

[aocommunalpunch]

7. Let's play a game: Who Wants to be Popular?

Shoot for the sky. Demz4Life.

[OneGrassRoot]

8. Canceling at least some student loan debt will go a long way...

toward gender and racial equity. We know women have been hit the hardest, economically, as a result of COVID. And we also know this:


From Thoughtco.com 6/20:

"Times have certainly changed. In fact, since 1981, more women than men have been earning college degrees. Furthermore, these days, women outnumber men on many college campuses, making up 57% of college students. As a college professor at a large, land-grant university, I notice that I often have many more women than men in my courses. In many disciplines—though certainly not all—gone are the days when women were numbered few and far between. Women are unabashedly seeking educational opportunities and charting new territories.


Things have also changed for women of color, particularly those from historically underrepresented minorities. As legalized discrimination has given way to more opportunities, women of color have become more educated. While there is certainly room for improvement, Black, Latina, and Native American women are continuing to matriculate onto college campuses in increasingly larger numbers. Indeed, some studies show that Black women are the most educated group in the U.S. But what does this mean for their opportunities, wages, and quality of life?"


That's why I think canceling student loan debt is one significant way of achieving more equity, enabling traditionally marginalized groups to use those funds to buy houses, for example, which has been thought to be the best way to work toward more generational and community wealth.

It's not just "students" and their parents who took out loans as a monolith. It's WHO this forgiveness will likely most benefit. That matters a lot here.

[Johnny2X2X]

9. Change pay as you earn to 5% of adjusted income from 10%

This is what Biden promised in his campaign site and would half the payments of those most in trouble.

Also 0% interest on all loans.

[NCDem47]

10. This is a problem in need of a solution, but only up to a point.

I'm 50 and spent 15 years paying back student loans. I knew what I was getting in to. I'm not trying to be a punishing parent here, but recent college grads have to assume some of the responsibility. It's all a mess though and the system is way out of whack.

[USALiberal]

19. I 100% agree! Many people worked 2 jobs to pay it back! Nt

[PoindexterOglethorpe]

11. Much of student debt should be forgiven.

Next step is to make public colleges and universities as affordable as they were when I first went off to college in 1965.

A few years ago I told my son that when I started college, it was possible to live at home, work at a minimum wage job full time over the summer, maybe part time during the school year, and make enough money (provided you saved most of your paycheck) to pay for tuition and fees at at least some public universities.

The true problem is that state legislatures have systematically been cutting funding for higher ed for the past 50 years. Along with that is the stupid idea that everyone needs a four year degree. The community colleges are still an excellent bargain and offer an amazing range of vocational degrees and certificates. Or, they're a wonderful inexpensive way to get your first two years of college out of the way.

But yeah, I'm good with cancelling a bunch of student debt.

[Blue_true]

15. We have to do something about the historical economic model that we have relied on.

Robotics and AI are taking jobs off a cliff. The final outcome will likely be dire if we don’t have smart intervention soon. A person who comes out of college with large debt, but who can only find middling pay jobs is not going to be happy long term.

We also need to look at having better adult education, vocational and college training. A young person who didn’t hit the book in K-12 school may see that as a mistake at 25 years of age and want to train for good jobs, we can’t leave that person finding opportunity to chance or connections (family members or family friends that own business which allows the young person to train for a higher skill and pay job).

[PoindexterOglethorpe]

17. Again, the community colleges are incredibly good at this.

Unfortunately the mantra of "Everyone needs a four year degree" is far too strong. There's a genuine shortage these days of things like plumbers and electricians. People in those jobs can often earn a lot more than someone in a lot of traditional 4 year college degree ones.

All too often young people simply major in what seems like a good idea without ever looking into what the eventual job prospects are. I'm beginning to think every school should have required classes in job prospects. In addition the community colleges should do regular outreach to high schools. Show the kids what the options really are.

[Blue_true]

29. Excellent points.

During my high school days, no one from the community college came to my high school. The school DID have an actual auto repair lab and a wood crafting lab, kids who were oriented toward those field went there - I remember one of my classmates would always have grease under his fingernails, he also clearly had no interest in the academic orientation of the vast majority of the kids in the class.

In addition to more teachers, we need more guidance counselors in schools. Kids entering the 10th grade should be required to have a conversation with a guidance counselor about what type of like work the kid envisions doing. Such a requirement would allow three years to orient the kid toward that kid’s expected field - but there ARE some risks involved with career locking kids that young, who is to say that a kid that expected to be an auto mechanic can’t change his or her mind and decide to study to become an auto design engineer?

[WhiskeyGrinder]

13. Forgive it all.

[PufPuf23]

14. There is another side of student loan debt that could be addressed

to make higher education more available and affordable.

Specifically cut the costs of the education by government subsidy or actually reducing the costs of facilities, administration, materials, etc. In the struggle to be "best", resources go to vain glory edifices and academic stars over the tasks of education, research, and technology transfer. The benefits of too much of the current system go to the already wealthy and powerful who are effectively subsidized by the masses of ordinary people who are hamstrung by student debt in obtaining education. Make education itself cheaper for the student consumers so they do not accumulate the debt burden.

Existing student debt from the broken system needs to be relieved. Back in the 1970s earned a BS from Cal (started age 21) and later in mid 80s an MBA also at Cal. Student fees were cheap. Living in Berkeley then was relatively cheap. As undergrad, had scholarships and several jobs and spent two years as a live in caretaker on a Piedmont estate. Graduated a an undergrad with zero debt. Took out a student loan for $5000 to buy first pc, printer, and a bunch of software when started MBA. Had as much income by 2nd semester of MBA doing consulting for what turned into Masters Applied Management Project as had from the GS-11 Fed job I had quit. Paid off loan soon after graduation and MAMP turned into a job. Best thing ever did in life was education at Cal. There is not the path I enjoyed as a young person available now, nothing even close as far as I can see.

[Merlot]

18. A good start, but does nothing to address the cost of education

[WarGamer]

20. the kind of issue that can sink 2022

It's FUEL for the fire.

Example.

David takes loans to go to school to become a social worker.

He owes $84,000.

If $50,000 is canceled, what will the people say who:

1) Never went to college because they couldn't afford it.
2) Paid off their own loans.
3) Went to CC and State Colleges instead of taking loans.
4) People who worked their way to College and paid as they went.
5) People who built careers through apprenticeship or hard work.

It's precisely the kind of issue that the Trumpists want to rile up the base pointing to the folks that "Got that there 50 grand leavin' y'all hard working folks with empty pockets... and btw, David thanks you for paying off his loan to be a sociologist."

Maybe wait until AFTER we pick up 3-4 Senate seats and hold the House?

[SYFROYH]

22. I paid off my loans this year and I'm cool with hypothetical David's debt reduced by $50k

We need social workers with good educations.

[WarGamer]

23. But that's just it...

You're not the Trumpist base that will head to the polls in 22.

If Repubs swamp the polls it could be 2010 v2.0

[meadowlander]

28. None of those people are ever going to vote for Democrats anyway.

So fuck em. Time to fire up our base.

We win 2022 by stopping voter suppression and getting Democrats to the polls. And you do that by acting like Democrats, keeping promises, and giving people a reason to vote for you.

[SYFROYH]

30. I'm not sure going for the Trumpist base is profitable.

I do think there are some in the middle who might come along.

I do think that helping 20-40 year olds pay off their student loan debt could help us with net votes.

[WarGamer]

31. I'm not advocating going for the Trump base.

I said paying off 50k of student loan debt will drive up the turnout in 22 from the Trumpist crowd.

For the reasons I stated above.

[meadowlander]

27. I'd say good on him for becoming a social worker.

That's a shit job with miserable pay that most people quit within a few years because they can't cover their expenses and get burnt out. The world needs good social workers who are paid what they are actually worth and aren't worked to death.

The point is that college costs have risen in the past thirty years in a way that's vastly disproportionate to the value of the degrees and overall salaries. That's not the fault of the kids who were told to go to college to have any hope of ever getting any job. I think a one-off course correction for people whose student loans costs were inflated is entirely appropriate.

I'm never getting married or having kids but I don't begrudge child tax credits or tax benefits for married couples. Just because every conceivable eligible person doesn't qualify for a tax break doesn't mean there isn't a justification for doing it.

I went to state college and transferred the maximum number of credits from community college and worked my way through school and grad school (two full time jobs every summer) and still had $65K of student loans of which I've paid off $55K over the past 20 years. It's not two neat categories of people who did everything they could to reduce college costs and people who graduated with a lot of student loan debt with no overlap between them. The $7 an hour jobs I worked as a student didn't come close to covering my tuition and housing and food and book costs even at a state school. It's not my fault there was a global economic crisis and I was unemployed for four years.

People who went to college over the last thirty years got screwed over but good. I'm sorry that not everyone stands to benefit from the proposed student debt jubilee but that's not a good enough reason not to do it. And I would be saying that same thing even if the proposal was $50K instead of $10K and I was missing out on $40K I've already paid back.

[Xolodno]

24. Looking at the arguments here....

...we can easily identify the real issue, tuition has gone up, wages haven't in most cases. But good luck on solving that issue in four years.

However, student loans are a dampener on our economy, people can't by goods and services if they are dropping bank to pay the loan, have their wages garnished, income tax returns confiscated, etc. And have no to little choices in rehabilitating or paying them off.

Some of things they can do is make federal backed student loans ineligible for profit schools.

Have some of the "wealthy" colleges subsidize the tuition (that will make paper origami classes and other novelty courses disappear real fast).

Make all the loans at the fed bank prime rate.

Do a gradual over time forgiveness.

Currently, if you go into teaching, etc. trying to get your loan waived requires you to do several back flips through flaming hoops while on a wire that crosses the Grand Canyon. Make it easier.

Waive some of the balance for volunteer work. Instead of a second job, doing things for Operation Gratitude, Boys and Girls Club, National Parks, etc. could be your "second" job and it helps out the community and reduces needed extra federal and state funding.

But good luck getting that past Moscow Mitch. He's not just the grim reaper for bills, he's a grim reaper for people. And I doubt he even knows how to sponsor or pass a bill into law anymore.

[blm]

25. Housing market would take off like a Bat out of Hell

That would have a helluva lot more positive impact than any GOP tax cut ..... ever.

[Xolodno]

26. In some areas, such as SF, I think property values will drop.

And red states would actually see property values rise. Why? The need for a higher income will drop like a bad habit and people can be more mobile. The two hour commute could vanish.

One thing about student loans, they are the same if your in Los Angeles or Jackson, Mississippi. But the pay is shit load higher in Los Angeles and even giving cost of living allowances, Jackson is still unaffordable. I refused a job in Las Vegas, simply because the income was way too low and I have a few So Cal sized payments.