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Student Loan Forgiveness and America’s Failing College System

The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.

By Andrew R. Vaz
December 8, 2023

In May of 2017, I had the privilege of writing a column for the PA Times on how every community must do more to invest in their children’s futures. Well, over six years have passed, and we, as Americans, have a crisis on our hands when it comes to our education system. The Student Loan enterprise is pushing more students into insurmountable debt loads. Lawmakers, citizens and even the Supreme Court are weighing in on the issue of loan forgiveness for each borrower.

This year, the Supreme Court ruled against President Biden’s student loan forgiveness plan that he campaigned on. Biden’s forgiveness plan called for canceling $10,000 in federal student loan debt for those making less than $125,000 or households with less than $250,000 annually. Americans owed a collective $1.71 trillion in student loan debt as of Dec. 2020, according to the Federal Reserve. By comparison, in Dec. 2010, Americans owed about $845 billion in student loan debt, which means student loan debt has increased by about 10 percent.

Some have proposed that the U.S. federal government forgive some, or all, existing student loan debt to relieve the financial pressure on individuals and the country. However, there have been arguments against student loan forgiveness, which is viewed as abusing the loan system. Those against loan forgiveness believe people must be responsible for their economic choices. A 2020 survey found that 46 percent of Americans believe student loan forgiveness is unfair to those who have paid off their loans, and 39 percent think it is unfair to those without loans. The main takeaway from this debate is that America’s college system needs to provide adequate value for the students who pursue a degree. Parents in America today are now questioning whether college is worth the investment for their children.

Going as far back as the 1970’s, attending college was relatively cheap compared to today. Between 1980 and 2020, the average tuition, fees and room and board for an undergraduate degree increased 169 percent, according to a recent report from the Georgetown University Center on Education and the Workforce. Specifically, according to the National Center for Education Statistics, the price to attend a four-year college full-time was $10,231 annually in 1980—including tuition, fees, room and board and adjusted for inflation. By 2019-20, the total price increased to $28,775. 

As a measure of good faith, there should be widespread student loan forgiveness for all college students that wipes out the entire debt. America’s future should not be burdened with a ‘mortgage’ when these students don’t own a house. This whole system has yet to help citizens; colleges are also to blame. In a 1987 New York Times op-ed, then Secretary of Education William Bennett accused universities of driving the student-loan gravy train. Bennett also suggested that the increases in financial aid in recent years have enabled colleges and universities to raise their tuition fees blithely, confident that federal loan subsidies would help cushion the increase.

Let’s also not forget Al Lord, former CEO of Sallie Mae—the predatory loan servicer. Lord admitted that he knew colleges were raising tuition because students had ready access to loans. Not only were universities conspirators in this scheme, but many also directly profited from Sallie Mae’s soaring stock prices. Those universities included Harvard, Yale, Princeton, MIT, Notre Dame, Stanford and Wellesley College, among others.

This system has already put taxpayers on the bill whenever the federal government does partial forgiveness of loans; the federal government should pursue discharging the entire $1.71 trillion off the backs of students. Student loan forgiveness would benefit low-income Americans the most, as it gives the most significant percentage of their income to paying off their debt. As such, canceling student debt will give these citizens more financial freedom.

Suppose America’s political leaders are willing to monetarily forgive the auto industry, Wall Street and the airlines. In that case, it should stand to reason that our government can ease the burden of student loans. What lesson are we giving our youth who see a college education as a public good that advances the common good, saddling them with loans that ultimately will not be forgiven in its entirety?

It is time for our federal government to act on the student loan crisis. Going to college for a post-secondary education should not be seen as penance—college students did nothing wrong. The future of our country rests on the shoulders of our children; we can’t entrust that responsibility if they are saddled with mounting piles of debt dragging right behind them.

AuthorAndrew R Vaz, M.Sc., M.P.A., MPhil is a doctoral candidate in the public policy and administration program at Walden University, already awarded a Master of Philosophy degree in the program. He is a graduate of the Master of Science in Criminal Justice and Master of Public Administration double master’s program at Florida International University. He can be reached at [email protected]

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