Student debt is a growing problem, increasing from $250 billion in 2004 to over $1.5 trillion today. President Biden has asserted that he’s willing to forgive $10,000 in debt for each student, while more progressive Democrats (Senators Elizabeth Warren and Bernie Sanders, e.g.) want to forgive up to $50,000 in student debt. This is a complex issue that needs a solution because the debt not only affects the people who have it, but reduces their ability to spur economic growth, hurting the rest of us.

People against debt forgiveness argue that it is expensive, so it is fiscally irresponsible. People who won’t personally benefit don’t see why their tax dollars should support something they’ll never use. Some people who have paid off their student debt feel it is unfair that those that come after them don’t have that burden. These arguments are not particularly strong; recent years have proven that deficit spending is not the problem critics initially thought it would be; your taxes will often support things you’ll never use, and if we all wanted people to suffer because we did, society would never improve.

A stronger argument against debt relief is that it is regressive; those who benefit most are those who spent the most on education, and they will eventually be wealthier than many of the people whose tax dollars are paying off their loans. Why should the tax dollars of a cashier at Walmart help an Ivy League graduate reduce their debt? That’s a fair question, but also a misleading one. People who attend the most elite schools are often from families wealthy enough to pay their way, or the schools are wealthy enough to provide aid to the non-wealthy students, so most graduates of elite colleges do not have large debt burdens. The students who graduate with the most debt tend to be from the less elite schools: Drexel University, Maine Maritime Academy, Detroit Mercy and Alabama State students have the highest debt (the Ivy League students have some of the lowest). Black students have much higher debt burdens than white students, because white families have more wealth to devote to education, so reducing student debt would alleviate some of the wealth gap between races.

Of course, the people who struggle the most are those who took on debt to attend college, but failed to graduate (almost 40% of borrowers). They have the worst of both worlds; high debts without the degree to help them get higher-paying jobs. Students at many for-profit schools also struggle, as many of their promises of remunerative jobs after graduation fail to materialize.

Some critics of loan forgiveness argue students need to be held accountable; they should have known the promises of a for-profit college were too good to be true, or their failure to graduate was their fault, so they should learn from the consequences. But that’s a lot to ask of an 18-year-old. Anyone who has helped a high school senior navigate the college selection process knows that expecting them to make a rational college choice based on their job prospects four years later, and decide how much money they can borrow based on their ability to make payments after graduation when most live at home and never had to pay living expenses, knows that’s unrealistic. And most students who fail to complete college don’t do so because they partied too much and failed their exams, but rather because they could not keep up financially (often while working low-wage jobs full time during school), and simply could not continue.

Excessive student debt is not just a problem for individual students, it also causes larger economic problems. This generation of students has less wealth than their parents did at their age. Young people with excessive debt have trouble buying houses or other major purchases, and may be more reluctant to marry and start a family. Graduates with high monthly payments have to focus on earning money, which limits the number of graduates who can work in fields that are less remunerative, like social work, or who can live and work in areas that are economically struggling. Students from rural areas are less likely to return after graduation because they need the higher wages offered in metropolitan areas to be able to pay their debts.

Another problem faced by people with student debts is that due to interest and penalties, they can make payments for years and owe more than they started out with. Many students struggle economically when they graduate, and may get loan forbearance, which allows them to reduce or stop their payments for a period without going into default, but the interest charges accumulate, adding to their overall debt. And unlike most debt, student loans cannot be discharged in bankruptcy.

Student debt is really caused by another problem, the high price of a college education, so any long-term solution must address that. In the short term, paying off the first $10,000 of undergraduate student debt should be the minimum ($25,000 would be better), since that will help everyone with college debt, and it will be valued most by people with the fewest resources. The remaining debt, I think should be consolidated with reduced interest costs (say 1% above inflation), and payments limited to a percentage of income until the debt is paid off. College attendance should help students thrive, not be a debt trap.

Kent James has a doctorate in History and Policy from Carnegie Mellon University and is an adjunct in the History Department at Washington & Jefferson College.

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