As the Loquitur editorial staff, we have a cumulative student debt totaling $116,000. Two out of the seven editors are fortunate enough to not have student loan debt but unlike many who complain that student debt relief is unfair, they still advocate for debt relief.
Perspectives editor Isaiah Disckson said, “People don’t make enough money to pay off these loans because they can’t get a high enough paying job and that ultimately affects future generations.” Dickson has no student loan debt.
On Aug. 24, 2022, the Biden administration announced a three-part government student loan forgiveness plan. In the announcement, President Biden claimed that individuals who made under $125,000 or families who made under $250,000 would qualify for up to $20,000 in student loan forgiveness. It also aims to fix the system for current and future borrowers, reducing tuition and holding universities accountable for rising tuition costs, and making community college free.
Thousands of U.S. residents hoping for life-changing loan forgiveness are now left wondering if Pres. Biden’s campaign promise will come true. The debt cancellation program is now being blocked by the Supreme Court, which on Feb. 28 heard arguments from six Republican-led states and two individuals who do not qualify for relief.
Due to the COVID-19 pandemic, student loan repayment has been deferred since March 2020, and 69% of graduates are worried about repayment starting again this summer. Forty-eight percent of college graduates reported living paycheck to paycheck on top of their 20-year student loan payments, which can start at $200 a month.
Student debt forgiveness is vital for everyone
There are many reasons why the student debt forgiveness plan is vital for us as future members of the workforce. For most Americans, some debt will carry over after college. According to Vox, Biden’s proposal would entirely wipe out student debt for 20 million people — nearly half of the total number of Americans who borrowed to pay for college and are still paying the loans back.
Some of these debtors were unable to finish their education. Others graduated and, saddled with a 4.9% interest rate, are still paying back their loans after decades in the workforce.
Students who wish to attend universities in countries outside of the U.S., namely Switzerland, Finland, the Netherlands, Norway, and Israel have the luxury of not paying tuition, this creates a less stressful environment post-college. According to the World Happiness Report done by the world happiness report, all of the countries listed above apart from the U.S. scored higher on their overall happiness rating. As it is proven, the amount of financial struggles of former and current college students is detrimental to our overall well-being.
Student loans have been on the minds of struggling college students for decades, and are the reason many either drop out or are uninterested in attending college. Forty-five million Americans carry student loan debt. About 43 million of these students federal loan borrowers. Whose debt totals about $1.63 trillion.
Many people may argue that student loans are a personal commitment and borrowers must be held accountable for the action, however, the trillions of dollars of debt are a detriment to the U.S. economy and has a direct effect on business growth and consumer spending.
The weight of student loans on borrowers’ backs has prevented entire generations from being able to buy a house, save for retirement, or plan for their children’s financial future. .These are milestones previous generations have hit with ease.
According to the Education Data Initiative high debt to income ratio can severely reduce the chances of mortgage eligibility. For every $1000 owned in student loans homeownership declines by 1.8 %. The student loan system also disproportionately affects Black students, whose wages consistently lag behind those of their white peers. Debt relief would help close some financial inequalities in the U.S.
Cost of living vs. inflation
Living as a college student is not cheap, which adds to the lack of affordability of higher education. Between housing, food, clothing, and other bills, the average annual cost of living for U.S. college students is $14,435, yet Pennsylvania’s minimum wage of $7.25 per hour has not risen since 2008.
A positive step forward
After hearing the weight of student debt might be lifted off of everyone’s shoulders, we now must wait for individuals who benefitted from lower tuition costs and a lower cost of living to determine the outcome. Not only will the student debt relief plan help build a stronger economy, but it will also allow people to plan for and invest in their futures.
This bill is a positive step in helping the working class, which at times seems forgotten by our government. The rich get richer, and the poor get poorer.
