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President Biden’s College Loan Forgiveness Plan: Good, But Not Great.

Last updated on September 11, 2022

Late last month, the Biden Administration announced that come October 2022, a new plan to forgive student loan debt would be put into action. According to The White House, individuals making less than $125,000 a year (or families making less than $250,000 a year) will be able to apply for $10,000 in financial aid; applicants will receive up to $20,000 if they are Pell Grant Recipients. This is a one-time occurrence, and was legalized because it is classified as aiding those who were impacted by disaster. 

The White House affirms that the plan will aid low and middle income, marginalized, and diverse communities. This is reasonable considering low-income individuals and people of color are generally more likely to default on loans (Talk Poverty, Insight into Diversity). Hence, by aiding low to middle income groups, higher education becomes more accessible, creating social mobility. At face value, the plan helps those who need it most.

On the opposing end of the spectrum, some wrongly assume that those with student debt should be able to pay it off because their degree would secure them a sizable salary. Sadly, this is not the case. According to the WRAL, 44% of those with student debt were unable to secure a degree in the first place. The problems start to arise when we take expensive tuition costs, family issues, and other variables out of their control into account. On top of that, events such as Covid-19 and recent hyperinflation have paved an even more challenging road to paying off debts. By paying off the student debts of low and middle income individuals, many can be saved from debt they would have otherwise not been able to pay off. 

But is this really the best solution? Firstly, the average salary of people with bachelor’s degrees in the United States is just around $60,000 (NCES). If the government truly wants to aid only those who need it, it ought to set the cutoff for assistance at least somewhere near the mean salary of those with a degree. And this doesn’t even take into account that, again, 44% of those with student debt don’t even have degrees, meaning that many of those who need it most actually fall under the median salary of those with degrees. 

Another question to be raised is if we, as taxpayers, have the obligation to pay for the education of others. Although it is true that we have the obligation to care for each other to some degree, this does not necessarily include paying for the education of others. For instance: we pay taxes to fund the military as insurance because we don’t know if or when we will be attacked. We don’t have a choice as to whether or not we will be affected. The same can be said about other services we pay taxes for such as the police or the fire department.

However, the relationship between a university and a student is purely consensual- the individual consents to paying a fee in return for a degree. Because it is a choice to enter college, others are not obligated to assist you when that decision results in financial strain. On the other hand, when it comes to military or fire service taxes, we have the obligation to pay because those affected did not choose to be harmed and similarly, and the same may happen to us. 

Here’s the takeaway: Biden’s plan isn’t optimal because it helps more people than it needs to. Additionally, even if the plan creates good by helping those who need it, it doesn’t mean that using taxpayer dollars is the fairest way to do so.

But what will happen in the future with this plan? The answer is, most likely, not much. The Biden Administration stated that the plan would combat the rising price of tuition across the nation. Although it may solve the problems of millions in the status quo, in the long term it does very little to stop the trend of rising college tuition for my generation and the ones to come. For that, stronger action must be taken.

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