This article is produced in collaboration between the Echo editorial board and our partners at the Clio History Journal. For more of their articles, click here.
On Wednesday August 24th 2022, the Biden Administration announced its new policy that gave millions of indebted students and graduates some form of hope and relief. Biden has forged a student loan forgiveness program that will forgive up to $20,000 in student loan debt.
Despite the fact that student loans have been in operation since the 1960’s, provided by the US government, for the first time, if you or the person you declare as a dependent makes less than $125,000 a year, $10,000 in debt will be forgiven. Furthermore, Biden’s administration stated they will forgive an additional $10,000 if you have ever received a Pell Grant.[1] This legislation seems like ice water on a summers day, giving millions of Americans the ability to breathe again. This will mainly help working class families gain traction against massive debts and middle class families who make too much to qualify for financial aid, but not enough to pay for school without having to take out loans.
The national average for student loan debt comes to a staggering $32,731, which, if students receive the basic part of the loan, which would give $10,000, would drop their debt by one third.[2] In particular, this measure might just be powerful enough to wipe out the remaining balance for 20 million borrowers, and will also cut down on the amount of money students have to pay each month, from 10 to 5 percent. Yet, one of the most underrated parts of this legislation is, they will be forgiving loan balances after 10 years of payments rather than 20 years.[3]
While this is seen as a genuinely good thing by many people, this comes to the dismay of many in the Republican Party, who have heavily criticized the student loan forgiveness program as an act of Socialism, a word seemingly that Republicans throw around to decry something as bad, untrustworthy, or corrupt. As former senior Kentucky senator, Mitch McConnell, stated
“President Biden’s student loan socialism is a slap in the face to every family who sacrificed to save for college, every graduate who paid their debt, and every American who chose a certain career path or volunteered to serve in our Armed Forces in order to avoid taking on debt, this policy is astonishingly unfair.”[4]
Senator Elizabeth Warren, along with Senator Sanders, have been two of the most vocal voices for student loan forgiveness and made a public statement against McConnell’s words of wisdom,
“Senator McConnell graduated from a school that cost $330 a year,” Warren wrote on Twitter on Thursday. “Today it costs over $12,000. McConnell has done nothing to fix it — and is irate that the President is stepping up to help millions of working Americans drowning in debt. He can spare us the lectures on fairness.”[5]
One interesting thing to note of course is how Republican lawmakers do not try to understand the economic principle of inflation, or the price hiking that many colleges have implemented over the years. Even accounting for modern day inflation, McConnell would have been going to college in the modern day for 3,153 dollars, excluding grants and scholarships.[6]
The more modern wing of the Republican Party have also made statements against student loan forgiveness, many of these statements come from political commentators such as internet personality Steven Crowder, conservative YouTube and webpage PragerU, and numerous Republican lawmakers.
Some of these people had also taken money; Majorie Taylor Greene had taken a large amount of PPP loans, which were never supposed to be repaid. They were issued with the express intention of being forgiven so long as the company didn’t lay off their employees. They were structured as a loan so companies would be on the hook for the full amount if they did take the loan and then laid people off anyway. However, at the same time, this is a type of loan from the government that many of these quite wealthy people, people that have multiple streams of income, do not need to take at all. Rather they took advantage of the Untied States government leading to many calling these political figures out on their hypocrisy.[7] Coincidentally, in this time Biden’s job approval rating has rose to 44% the highest it has been in a year.[8]
Overall, despite what sorts of petty objections certain members of the government spew, the fact of the matter is, this program is here and it is here to stay. This program will likely cause little to no harm to anyone and will only be benefitting generations of students crippled by debt. Anyone who is suffering from student loan debt should visit: https://studentaid.gov/manage-loans/forgiveness-cancellation to see if they qualify to have their loans forgiven.
[1] Ayelet Sheffey, “Elizabeth Warren Points out Mitch McConnell Graduated from a School That Cost $330 a Year amid His Criticisms of Biden’s Student-Loan Forgiveness: ‘He Can Spare Us the Lectures on Fairness’,” Business Insider (Business Insider, August 26, 2022), https://www.businessinsider.com/elizabeth-warren-slams-mitch-mcconnell-student-loan-forgiveness-college-tuition-2022-8.
[2] Justin Song, “Average Student Loan Debt in America: Facts & Figures,” ValuePenguin (ValuePenguin, August 8, 2022), https://www.valuepenguin.com/average-student-loan-debt.
[3] “Fact Sheet: President Biden Announces Student Loan Relief for Borrowers Who Need It Most,” The White House (The United States Government, August 24, 2022), https://www.whitehouse.gov/briefing-room/statements-releases/2022/08/24/fact-sheet-president-biden-announces-student-loan-relief-for-borrowers-who-need-it-most/.
[4] Ayelet Sheffey
[5] Ayelet Sheffey
[6] “Inflation Rate between 1964-2022: Inflation Calculator,” $330 in 1964 → 2022 | Inflation Calculator, accessed August 26, 2022, https://www.in2013dollars.com/us/inflation/1964?amount=330#:~:text=Value%20of%20%24330%20from%201964,of%20%242%2C823.91%20over%2058%20years.
[7] “White House Shines Light on Republicans Who Are Criticizing Student Debt Cancellation after Getting Their PPP Loans Forgiven,” Yahoo! (Yahoo!), accessed August 26, 2022, https://www.yahoo.com/now/white-house-shines-light-republicans-032304886.html.
[8] Megan Brenan, “Biden’s Job Rating Rises to 44%, Highest in a Year,” Gallup.com (Gallup, August 26, 2022), https://news.gallup.com/poll/398117/biden-job-rating-rises-highest-year.aspx.
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