By Rocco Golden
Debt in the United States has been an issue at the forefront for decades. It’s no secret that debt is a problem, but currently, the secret seems to be the solution. As is with the current political state of the U.S., many Americans are quite divided on how to solve the rising debt crisis. Student debt, in particular, has been a hot topic as of late.
President Biden announced August 24 that he would cancel at least $10,000 in student loan debt for borrowers. Biden tweeted: “In keeping with my campaign promise, my Administration is announcing a plan to give working and middle class families breathing room as they prepare to resume federal student loan payments in January 2023.”
According to an article by the Associated Press, individuals can qualify up $10,000 forgiven if their loan is held by the Department of Education and they make less than $125,000 individually or $250,000 for a family. Additionally, those with the most financial needs and who have received Pell grants may have up to $20,000 forgiven.
This recent announcement had sparked mass debate in the country. Perhaps the most prominent debate amongst people is whether debt forgiveness is fair. Is it really fair to someone who has already paid off their debt? Why should a person who paid off their student loan debt have to pay money in taxes to the government to pay for someone else’s debt.
To many Americans, the Biden administration’s new plan to cancel student debt is a bad solution to an even worse problem. A vast number of Americans are concerned with regards to the economy. Many believe that the extra spending by the government will not be good in the long run. A couple weeks ago, former Treasury Secretary Lawrence Summers stated that Biden’s plan will only make things worse.
“Every dollar spent on student loan relief is a dollar that could have gone to support those who don’t get the opportunity to go to college. Student loan debt relief is spending that raises demand and increases inflation. It consumes resources that could be better used,” Summers said.
There are undoubtedly a plethora of other problems in the country that this money could go to other than student debt such as homelessness, infrastructure or more sustainable energy programs such as nuclear.
On the topic of inflation, the Consumer News & Business Channel recently did a survey and concluded that 59% of Americans think that Biden’s plan will worsen inflation. If inflation does worsen, that will only mean increased costs for most things, college tuition included.
While the national opinion on this topic may always be severely divided, many students here on campus seem to be in agreement. Many students are optimistic about Biden’s plan and are glad the debt will be lifted off their shoulders.
“It’s going to cost the government a lot of money, but there are plenty of issues like militaristic spending that could be replaced with helping college students be more successful, and actually developing the country from the inside,” said Jerrique Ortiz, a biomedical sciences major.
Michael James, a political science major, agrees with most other students with regards to the plan’s fairness, “as long as it’s helping people go to school.”
Sean Requena, a double major in business administration and MIS noted: “I feel like it’s going to take a lot of funding, but I feel like a lot funding goes to the military and helping other countries, so, if we can do that for them, we should help people from our country too.” A lot of students here on campus are going to benefit from the plan.
For students of lower income or independent students, the student loan forgiveness is a Godsend in an otherwise worsening world. However, the question of this plan’s real worth will certainly be tested in the months to come.
If inflation, and tuition costs with it, continue to rise, it will only lead to a downward spiral of spending between the government and students. Only time will tell if Biden’s plan is really the best solution to the debt problem.