Loan Forgiveness for Students: Prospects and Implications
As President Joe Biden's re-election bid in November 2024 approaches, the issue of student loan debt relief remains a significant concern. Biden, along with Senator Bernie Sanders and other Democrats, has advocated for measures to alleviate the burden of student debt, with proposals such as increasing the student loan cancellation cap and implementing tuition-free public colleges.
The average cost of tuition and fees at a public four-year institution for in-state students is $11,260 for the 2023-2024 school year. However, for many students, the cost of college is a determining factor in their college application process, and for some, it is a source of anxiety and financial strain.
One such proposal aimed at addressing the student loan debt crisis is the SAVE plan, which aims to relieve borrowers of up to $20,000 on their loans and is targeted to low and middle-income families. The plan, however, has faced opposition, with the Supreme Court blocking it in July 2023. The Biden-Harris administration has encountered staunch opposition from the GOP, especially in the Senate, regarding the SAVE plan. Moderate Democrats, such as Senator Joe Manchin, favor targeted relief measures over widespread debt cancellation.
The student loan debt currently stands at $1.77 trillion, a figure that has been exacerbated by economic downturns, such as the 2008 recession and the COVID-19 pandemic. The number of Americans pursuing post-baccalaureate programs is projected to increase from 3.2 million to 3.4 million, potentially adding to the growing student loan debt.
The Biden-Harris administration has made some progress in addressing the issue, having forgiven 7,000 public-service workers of their loans, a total sum of $9 billion, as of October 4th, 2023. However, the internal division within the Democratic Party complicates the legislative process regarding student loan debt relief.
Dasha Smirnova '24, a student, emphasized the importance of finance in her college search process, expressing concern about graduating with substantial debt, especially for future graduate studies. Sarah Cheng '24 stated that out-of-state colleges are often out of reach due to limited aid for non-residents.
Representative Alexandria Ocasio-Cortez supports more ambitious debt cancellation measures than the SAVE plan, including tuition-free public universities. House Representative Tim Ryan has joined the Republican criticism of student loan forgiveness.
The cost of college continues to be a pressing issue for many students and families. As the election approaches, the debate on student loan debt relief and the proposed solutions will likely remain a hot topic.
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