By Charlotte Sandler '21
One point seven trillion dollars. This is what staticians have evaluated America’s student loan debt to be in 2021. With many of us seniors contemplating and weighing the advantages and disadvantages of taking out student loans, this estimation, while deeply unsettling, represents the necessity and reliance that many college students place on loans. For some, this is the only option.
In the midst of a global pandemic and with a new administration in office, the pressure is now on President Biden to take action in order to help heal the soaring debt, especially since it has been exacerbated by the COVID-19 crisis. As one of his first orders, President Biden directed the Department of Education to pause federal student loan payments for eight months through September 30th, 2021. This executive order is one step of action towards pandemic relief, following suit of the CARES Act passed in March 2020, giving 42 million student loan borrowers a temporary forbearance from their monthly payments and accruing interest.
However, this temporary break will not fully relieve borrowers of the heavy burden that looms over them. That is why members of Congress, most notably Democratic senators Elizabeth Warren and Chuck Schumer, have been urging Biden to wipe out up to $50,000 in student loans per borrower. On Tuesday, February 16th, Biden dismissed the Democratic plan. "I will not make that happen," he said. "I'm prepared to write off $10,000 in debt, but not 50. I don't think I have the authority to do it."," he said during a CNN town-hall. He also stated that he believes loan forgiveness "depends on whether or not you go to a private university or a public university." Despite his rejection, Progressive lawmakers have kept up the pressure on Biden. Representative Ayanna Pressley (D-Mass.) and Representative Alexandria Ocasio-Cortez (D-N.Y.) both continued to advocate for the Democratic plan, as they believe it would benefit low-income families.
Despite the clash over what amount, most would agree $10,000 is better than nothing at all. For over 30% of loan recipients, the $10,000 write-off will completely relive them. Borrowers with under $10,000 of debt each collectively owe about $74 billion. Meanwhile, there are around 30 million borrowers with higher balances. Multiply that out by $10,000 each, and you get another $300 billion in forgiven debt (Source 1). While promising, and definitely a step in the right direction, the real concern lies in in these monstrous numbers. With tuition, room, board, books, and fees steadily increasing, the rising cost of attending college has been exceeding the rate of inflation for decades. How has college tuition become so expensive that we are in a $1.7 trillion crisis?
The roots of rising college costs are not difficult to identify. For the nation’s 1,600-plus public institutions, one of the main reasons can be identified as major reductions in state support. In fact, public funding of higher education has been in decline since 1980, according to the American Council on Education. State funding and subsidies were cut by more than $7 billion between 2008 and 2018. In addition, the privatization of public higher education has forced states to shift their share of instructional costs to students and their families.
This extremely complex issue may seem as if room for reform is long-gone. However, our nation often underplays the power of change that students themselves can launch. With so much to lose, universities themselves are not going to fix the problem. However, students who are willing to take a stand can. By delaying enrollment, protesting, and putting pressure on these institutions, students will advocate for not only their current and future financial standings, but their freedom.
Source 1:
Department of Education. Includes direct, government-held FFEL, and Perkins Loans
Editor: Cecilia Fiorindo
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