Economy Robert P. Alvarez

Cancel Student Loan Debt. Bail Out Regular People.

Even writing off every penny of student debt would cost less than Trump’s tax giveaways for corporations and the rich.
[Jared Rodriguez / Truthout]

By Robert P. Alvarez | OtherWords

I borrowed money to pay for college. Like 45 million other Americans who did the same, I owe student loan debt.

My generation was sold a pipe dream about what a degree could mean for our future. I wanted so badly for this dream to come true that I leapt at the opportunity to take out loans.

What I didn’t know then was just how much the cost of higher education was soaring — and that colleges were hiking prices to take advantage of the federal government’s willingness to help poor and low-income students like me cover tuition.

I remember talking to my college counselor about how she paid $240 a year to attend one of the best universities in my home state. Since my counselor attended college, inflation has risen 645 percent. Meanwhile, tuition at the college she attended has risen 11,820 percent.

If you ask earlier generations how they paid for college, they say things like “I worked a part-time job after school.” Yeah, I did that, too. You know what that money went toward? Rent, gas, and bills. My McDonald’s job was barely enough to keep me afloat, let alone pay for my tuition and other expenses.

It was either take out student loans or drop out of college. I chose not to drop out.

I graduated and eventually got a job in my field. But with the rising cost of housing and everything else, that loan debt, which is already inflated by skyrocketing college costs, now feels suffocating. It prevents me from qualifying for a good mortgage loan and makes me second guess whether I can afford to have children.

My loan is just a tiny fraction of the national student loan debt. The $1.7 trillion student loan borrowers owe is a massive policy problem affecting everything from housing to the job market to retirement savings and so much more.

That’s why there’s a growing movement calling on the federal government to cancel some or all of this debt.

If the federal government canceled $50,000 worth of student loans, it would give 36 million borrowers a new lease on life. It could enable them to buy a house, start a family, or open a business.

I know it sounds like a radical idea to cancel up to $50,000 worth of student loan debt. It’s not.

If you’ll remember, former president Donald Trump and the Republican Party passed a $1.9 trillion, high-end tax cut in 2017 that’s been called “socialism for the rich.” It led to billionaires paying a lower average tax rate than the working class for the first time in U.S. history, and is directly responsible for corporate tax revenues plunging to near record lows.

That sounds a lot more radical to me than helping regular people. Even writing off every penny of student debt would cost less than Trump’s tax cuts for corporations and the rich.

President Biden has expressed interest in forgiving some student loan debt, although he’s indicated he may not cancel more than $10,000.

I’d welcome any amount being knocked off my loan. But I fear if Biden cancels only $10,000, he would fumble an enormous opportunity to improve millions of lives and give the economy a desperately needed shot in the arm.

The precedent is there. The U.S. has a long history of economic bailouts dating back to 1792.

The benefits are there. Studies show forgiving student loan debt would create jobsgrow the economy, and have the added benefits of helping to narrow the racial and gender wealth gaps.

And, importantly, student debt forgiveness has broad public support, including among people without a college degree and without student loan debt, as well as young people.

It’s time for the federal government to bail the people out. It’s time to cancel student loans.

Robert P. Alvarez

Robert P. Alvarez

Robert P. Alvarez is a media relations associate at the Institute for Policy Studies. This op-ed was distributed by OtherWords.org.

19 comments

  1. This looks like one more giant “fooled you again!” middle finger to people who believed his lies.

    They’re warming Clyburn up again for the midterms, even while the Democrats cave to the law and order, pro-police, corporate interests. Voting rights law? Massive help for the poor and needy?

    QUICK! Send out the Squad!

    Rep. Jayapal: We’re trusting President Biden will get 51 Senate votes
    https://news.yahoo.com/rep-jayapal-were-trusting-president-035036937.html

    Alexandria Ocasio-Cortez says she’s thinking of getting rid of her Tesla after her Twitter feud with Elon Musk
    https://www.yahoo.com/news/alexandria-ocasio-cortez-says-shes-131945450.html

  2. A well stated argument for forgiving student debt but…

    I am a bit skeptical of the polling cited to support the argument. Does the “no college” cohort really support loan forgiveness more than the “college” cohort, as this survey claims.

    And do people really support forgiving $50,000 in debt more than forgiving just $10,000, as this survey reports?

    Yes, Trump did get a $1.9 trillion giveaway to the rich passed but we did not like that at all so I don’t see how it can be used to justify a tax burden at the other end, unless tit for tat is a good argument.

    As for the benefits to be had from a loan forgiveness program, there is always another side to the balance which must be considered.

    So, the real question is whether student loan forgiveness produces more benefits than, say, a mortgage forgiveness program.

    Finally, some surveys now show some favorability for a student loan forgiveness program.

    But how will it look come election time when the right gets hold of it and markets it to voters in the rust belt as another gift to snot nosed liberal kids from NY and California who don’t honor their pledges and want the liberal state to bail them out.?

  3. Corporate
    Capitalism
    Creates
    EMPIRE

    Corporate Capitalism Creates Empire

    “Guns don’t kill people — Empire does”

  4. You are ABSOLUTELY RIGHT! The dems are fools not to push for not only a student debt forgiveness, but a general debt jubilee of some proportion. China, who has a much more pragmatic attitude toward debt than we do is going to “eat our lunch” until we confront the problem of the private banks’ monopolistic paradigm for the creation and distribution of money of Debt Only with the new paradigm of Monetary Gifting. You want to beat China? Deal with our sufocating indebtedness. And here’s how with 3 policies that will change and possibly save the world from debt, social and political disintegration and the problem of climate change to boot.

    Policy #1: A $100k debt jubilee for everyone, and if you don’t have any debt (almost no one) you get a gift of $25k.

    Policy #2: A $1000/mo. universal dividend paid to everyone 18 and older…for life.

    Policy #3: The most important and effective policy that has ever been advocated in economics because it is the very expression of the new paradigm concept in money and economics, a 50% discount/rebate policy at retail sale. Think about it. The consumer now pays $50 for $100 worth of goods and services, with the discount the merchant gives to the consumer rebated back to them by the monetary authority they get their entire price so they can be whole on their overheads and profit margins. This single policy usheres in the new monetary paradigm. It macro-economically ends inflation by doing what? By integrating BENEFICIAL price and asset DEFLATION. What a mind blower! By the way, total inversion of mental and temporal universe reality is the cardinal signature of historical paradigm changes. For instance the Copernican cosmological paradigm change was the inversion of the positions of the earth and the sun. The monetary paradigm has not changed for the entire course of human civilization. The continual and inevitable build up of debt and the powerful lobby weilding the paradigm of Debt Only (whether it was the palace/government or the private banking system) has historically been the most important factor in the destructive actions and disintegrative collapse of empires. Recognize that? That’s right, that characterizes the USA. Read the entire program of policies of the new monetary paradigm here: https://www.amazon.com/dp/B07PLNJLRN/ref=sr_1_1?keywords=wisdomics-Gracenomics&qid=1552358772&s=books&sr=1-1-catcorr

  5. It’s time for separation of school and state similar to separation of church and state.
    People should have learned in free government schooling that there is no free lunch.

    1. No free lunch unless you are a millionaire or billionaire who have rewritten the tax laws because we have the best Congress that money can buy! The wealthy have unfair advantage to pay little or no income tax. Not my opinion only, wake up & smell the income gap. It’s not because the poor are lazy!

      1. The middleclass majority have an unfair advantage in writing the tax laws since the rich and the poor are still minorities in this democracy.
        Income taxes are partial payments for welfare and war. Income taxes are an immoral seizure of earnings.

    2. Without public schools most people in this country would never have an education.
      The expansion of private and charter schools, especially those benefiting from taxpayer money is an effort by profiteers to destroy public schools. Unfortunately, many parents in needy communities who are currently sending their children to taxpayer supported private and religious schools do not see that once the public schools in their cities are all closed that private school tuition will be raised to the level where they can no longer afford it and their children will have no where left to go for their education. That is the ultimate plan by private education profiteers, and it is pure evil.
      What we really need to keep separate is school and profit!

      1. Without government schools, there would be less bipartisan support for government spending. The national debt stands at $30 trillion and unfunded liabilities at $169 trillion.

  6. Glaring contrast between the US capitalist clusterfck and a state that actually understands the value of educating its citizens.

    China’s Schoolkids Are Now Officially the Smartest in the World
    … from Bloomberg, not People’s’ Daily

    Chinese students far out-stripped peers in every other country in a survey of reading, math and science ability, underscoring a reserve of future economic strength and the struggle of advanced economies to keep up.

    The OECD’s triennial study of 15 year-old students across the world found that the four Chinese provinces tested — Beijing, Shanghai, Jiangsu and Zhejiang — outperformed in science and mathematics, even if household income is well below members’ average. In reading, the 10% most disadvantaged Chinese students tested had better skills than the OECD average.

    “The quality of their schools today will feed into the strength of their economies tomorrow,” OECD Secretary General Angel Gurria said.

    The PISA study of 600,000 students in 79 countries shines a light on the difficultly of improving education, sometimes irrespective of the resources that are dedicated to it. That appears to be particularly problematic for OECD countries that have increased spending on primary and secondary students by more than 15% in the past decade.

    “It is disappointing that most OECD countries saw virtually no improvement in the performance of their students since PISA was first conducted in 2000,” Gurria said.

    The report also highlights disparities in educational achievement depending on socio-economic background. In some countries, even where government spending on education is high, the background of a student still plays a significant role in their educational outcomes.

    On average, 12% of the variation in student reading performance within each country was associated with socio-economic status. In several European countries, including France and Germany, that measure rises above 17%.

    *********************

    Count of the US to thrash around continuously with brainless “ideas” like homeschooling and charter schools.

  7. So your loan gets forgiven, and then what?
    The problem with the left is that the focus is always on the symptoms and rarely the cause. Do you realize that ALL money is created through the debt process? Not a secret except to the general public. Private banks create the money we use when then create a loan. Your mortgage money filters throughout the economy to feed the money supply. Unless this is stopped, and instead all money is be created by the government to fund spending (and free college education), this debt jubilee idea is just kicking the can down to the next generation.

    Look up the 2011 bill that Dennis Kucinich introduced, HR2990 or the National Emergency Employment Act, to see what money reformers are trying to get progressives to pay attention to. But if the drama and struggle against the symptoms floats you boat, there’s lots to keep you busy – forever.

  8. Though certainly a huge benefit to students with loans, but this unreasonable and a blame piece when students knew what they were getting into when borrowing and need to take responsibility.
    An alternative is: setting up a in “service to America” program with different choices that one can make.
    2 years service part time would be some tradeoff for loan forgiveness. And yet more debt to the average American with another 1 Trillion on the books. And why not go after the scam college fees and tuition rampant in large and independent schools. I have personal knowledge of one such corporation with many schools across the company training in blue color skills and making job and placement claims and ripping off the govt loan programs for students who are left standing after graduation due to poor training, tight job market or not being qualified to begin with as a student in that field.

  9. “Ordinary people.” Less than half of American adults have gone to college. Those who sought and signed for college loans were adults who understood the terms of repayment. While so many “fellow Americans” are denied the most basic human rights (UN’s UDHR) to food and shelter, , the middle class call on government to pay off their debts and give them free health care. The thing is, the it’s the ruling rich who are in power.

  10. Let’s review again the multi billions our govt is spending on immigrants, migrants, refugees and illegals. Priorities.

    1. Fake News!
      These groups pay more in taxes than they receive in benefits.
      Unless you are including the costs of caging, shooting and harassing immigrants.
      Bad hombres!

  11. Time again to trot out time-tested issues for getting out the vote for the next election fraud – abortion, gun control, and now student loans. Let the regular people cry out for the regular ruses of relief from the very corporate state fronts who’ve been driving generations into this leading means of debt bondage/indentured servitude.

  12. NOT JUST 4 YEAR MIDDLE CLASS ELITE YOUNG

    I’m one of the few who can speak from experience about all sides of this issue.

    When young, I went to a community college for the college transfer basics and for two trades programs. The trades allowed me to earn a good living for more than 2 decades. At the time, a person could work a part time job, afford somewhere to live, and pay the low comm college tuition.

    No more. Even the local community colleges cost enough that loans are required. These places are where the poor and working classes go. Often they are older; they have kids and low paying jobs. They don’t have parents who can help out. If anything happens–a child is ill, they lose a job because their old car breaks down–they drop out. So not only don’t they get their credentials, their loans become due since they’re no longer in school.

    I also went back to school in my late 40’s, and grad school in my 50’s. Something many Baby Boomers had to do because of job loss. (And BTW, then pension gone, too.) No way to get through a university for the last 30 years without student loans, especially if you’re trying to maintain a good grade point.

    There are a bunch of us on Social Security who “owe” huge chunks of $$$ for the privilege of having become overqualified for entry level jobs. Of course being over age didn’t help, either.

    $10k?! What a joke. The interest rates make it nearly impossible to make any headway on repayment for anyone with a job. Sure, some of us loanees are in forbearance. But every time one of these loan consolidation outfits merges with another, the time lag means they can add lots more interest.

    In the words of Tennessee Ernie Ford: “You load 16 tons and whatta ya get. Another day older and deeper in debt…”

  13. Date: June 24, 2022

    Since most white-collar jobs in the US have been outsourced to China, it is fair to cancel all US student debt. That is until all anti-American globalist policies are outlawed, and US employers are forced to manufacture products here in the US.

    While this seems like prices will rise, at the same time the US GDP will increase causing the buying-power of the US Dollar to increase. Thus, canceling out increased costs of products manufactured in the US.

    Until all anti-American globalist policies are outlawed, university tuition is to be waived, as a matter of US economic stabilization. Free university tuition is justified until US employers manufacture (and export) products made in the US. This will bring forth a hiring-boom in the US, then it is justified to require university graduates to pay for university tuition and associated costs.

    1. Eliminate all student debt is unfair and not the solution though from a certain political perspectives may seem so. as most loans are given to students for technically oriented job training or nursing, et. al overseas competition is not really a issue. The real problem are loans are to indisciminate often and too large due to corruption of schools issuing Fed loans by proxy. My niece worked for a esthetics program in admin and had to quit for ethical reasons. the school was promising work and training students even though there were not enough jobs locally or the students would never quality because of poor skills even after school (learning issues). Nevertheless, the school was factory processing students and getting a boatload of fed $$ as a result and very profitable with multiple schools nationwide Yes we have seen it before, using the system, and no govt oversight on spending. Loans should be balanced with volunteer work during or after graduation. I had loans and had to pay them off over time and never thought of the privilege of asking for eliminating debt. I worked part time too.

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