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Members of our Community Editorial Board, a group of community residents who are engaged with and passionate about local issues, respond to the following question: With the pause on student loan repayments set to expire at the end of August, many Colorado student loan debtors are asking for relief. Your take?
Opponents to student loan debt relief love to lament the “entitlement” and “laziness” of current and former students who are heavily burdened by their higher education debt. They ask (rhetorically, I suspect): why did you take out loans if you didn’t intend to pay them back; why did you go to an expensive university if you couldn’t afford it; I had to work my way through college and pay my debts — why shouldn’t you?
These reactions oversimplify a complicated scenario. They also fail to account for the fact that for decades students have been encouraged to borrow tens of thousands of dollars each year for college educations that promised a path to the middle class. In that same time, state governments have slashed public education budgets, tuition has skyrocketed and wages have remained stagnant. Consequently, that old saw — college is a sure-fire way to a healthy middle class and borrowing to pay for higher education is a good investment in one’s future — falls way, way short.
In fact, the middle class is shrinking. Income inequality is seeing the net worth of wealthy Americans grow exponentially while the poorest among us — many of whom attended college and have student loan debt — struggle significantly. According to the U.S. Census Bureau, in 2020, the top 20% of the population earned 52.2% of all U.S. income. The bottom 20% earned only 3% of the nation’s income.
But it’s not just the poorest among us. Professionals in relatively low-paid careers struggle to live in Boulder and raise their families in part because of their student loan debt. Before you suggest that these people aren’t entitled to live in Boulder, consider that they are our teachers, first responders, journalists and other professionals who make a real impact on the local economy and community. We (or at least I) want these folks as our neighbors. Relieving student loan debt could make the difference between their choosing to stay in our community or leave for a less expensive place.
I grew up in a wealthy part of Colorado Springs in a relatively poor family. I graduated from college with tens of thousands of dollars of student loan debt that is all paid off today. Even though I won’t benefit from student loan relief directly, I still support it. Investing in an educated population is one of the smartest moves a country can make. So, while I, like many, await some announcement from President Biden about student loans, I also believe that our leaders must take steps to make college more affordable.
Rachel Walker, email@example.com
The current student loan issue is just one of the many current societal “illnesses” that cannot be addressed individually, at least not effectively. It is too deeply tied to the body politic at too many levels. Indeed, to further use a medical analogy, it is more of a symptom than the actual disease.
Similar to symptoms like chest pain for heart disease, thirstiness for diabetes, or unexpected weight loss for various cancers, student loan problems emerge as a later stage symptom of something more seriously wrong under the surface. Medicine progresses ultimately by being able to look beyond the symptoms into the deeper causes of disease states. From unbalanced “humors,” to the development of dissection and microscopy, through to biochemistry and the various -omics, we have begun to uncover the root causes of many conditions and diseases, and thus finally increasing our chances to fix them at a fundamental level. Can we do the same for the student loan mess?
Student loans per se are neither good nor bad, maybe even necessary. Ideally, they should be no different than any other loan. But their actual availability and policies have become pathological. It is increasingly necessary (in general) to have some kind of college degree that serves as the key to open future employment opportunities and income security. But the crazy inflationary cost of such education has put it far beyond the means of most people.
Scholarships cannot fill that gap for everyone. Student loans can at least partially fill that gap, but as the gap grows so does ridiculous levels of debt (and even desperation), especially as more and more stakeholders grab their share of the money involved. It is an accelerating spiral downwards, much like the processes that underlie diabetes or heart disease.
But again, student loan debt itself is not the real sickness. No, the real disease is much more insidious. And it has many more symptoms than just crushing student loan debt, including things like the lack of affordable housing, health care disparities, increased crime and mistreatment of some individuals. The real disease is the accelerating concentration of wealth in the hands of fewer and fewer.
Student debt forgiveness may be a good temporary fix for some people. But it is hardly a panacea and will likely lead to other problems. Instead, we need to directly attack the decades of wealth inequality that is a metastatic cancer eating at the health of our society.
Fintan Steele, firstname.lastname@example.org
Relief from student loan debt won’t come from the Biden administration.
Rep. Alexandria Ocasio-Cortez tweeted last December that “It is actually delusional to believe Dems can get re-elected without acting on filibuster or student debt.” Democrats are open to using a quid pro quo with loan forgiveness and votes. However, for every vote Mr. Biden’s debt forgiveness may buy for the Democrats, he risks losing multiple votes. The proposed debt forgiveness is opposed by conservatives, moderates and even some liberals. That is because it is ultimately the taxpayer, not the Democratic National Committee, who foots the bill. I think Biden and the Dems will skip on the relief program and instead focus on their climate bill and the backlash to the overturning of Roe v. Wade for their midterms campaign.
That’s an unfortunate situation for students all around. I think we can all agree that rising levels of student loan debt are a problem. Student loan debt has increased by roughly two-thirds over the past 10 years to a total of $1.7 trillion. As state-level support for higher education has receded, the federal government’s role has grown. In turn, colleges and universities have become more reliant on tuition payments from students, and they have increased their costs to match the vast federal resources made available to students, including student loans. A 2021 report based on data from the College Board suggests that the cost of a college education has risen at about 4.6 times the rate of inflation over the past 50 years. Indiscriminate loan forgiveness would exacerbate these factors and remove any incentive for institutions and their administrators to manage their costs. And what about the repercussions? Will all future federal support come in the form of grants and not loans? Or will there be an expectation that new loans will be canceled every few years, turning higher education effectively free? Before we analyze the budgetary and inflationary impacts of such a policy, we must rein in the ridiculous cost inflation of higher education.
Rather than pushing for yet another inflationary, budget-busting policy initiative, the Biden administration would be better off: First, proposing that the student-loan provisions of the Bankruptcy Code be amended. Second, reforming student lending to reduce the outsize role of the federal government in financing higher education.
Hernan Villanueva, email@example.com
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