Thursday, May 13, 2021

Something Must Be Done

Navient, a company that services 25% of student loans in the United States for the U.S. Department of Education, handles my student loans. They are a pain in the ass to deal with, especially when their website is constantly down. Every year, I have to submit proof of my income for the student loan income-driven repayment plan, which bases my student loan payments on my current income. Back before I was eligible to take advantage of this program, and I was still working at the private school in Alabama, my gross monthly salary was $2,000, and I was paying over $900 in student loan payments each month. If it had not been for my aunt’s help, I would not have been able to survive. Luckily, the laws concerning student loans under the Obama administration changed to make it easier to repay loans based on income, get loan forgiveness for public service, and stop predatory lenders. Much of the benefits put in place by the Obama administration were either ignored or undone by the administration of the former twice-impeached president’s administration, who appointed an Education Secretary with no education experience.

While I am a huge supporter of President Biden, he has to get off the fence about student loans and the skyrocketing cost of college tuition. Biden campaigned on a platform that included ambitious changes for higher education and relief for student loan borrowers. On his first day in office, he extended the student loan payment pause through September 30, 2021. Since then, he has laid the groundwork for student debt cancellation, but he has offered no specific proposal or amount yet. Depending upon pending legal interpretation, Biden could use executive authority to cancel student loan debt or ask that Congress pass a bill doing so. On April 28, the White House unveiled its American Families Plan, which, among other things, proposes to increase Pell Grants, provides for free community college, and steps up aid for schools that serve minorities. It must pass both houses of Congress before it becomes law.

Even before Biden’s inauguration, his staff reiterated the president's support for Congress to "immediately" cancel $10,000 of federal student loan debt per person as part of COVID-19 relief. While this plan would wipe out debt entirely for nearly 15 million borrowers who owe $10,000 or less, the majority of student loan borrowers (roughly 67%) have significantly more than $10,000 in debt. Everyone I know (all of whom went to graduate school) who has student debt owes between $150,000 and $200,000 in student loans. On the campaign trail, Biden recommended canceling federal student debt in the following instances:

  • If you attended a public college or university. Attendees of private historically Black colleges and universities and additional minority-serving institutions would also be eligible.
  • If you used the loans for undergraduate tuition. Biden’s proposal would not cancel graduate student debt under his current plan.
  • If you earn less than $125,000. Biden’s platform referenced a phase-out of this benefit but did not offer further details.

 This plan does a great disservice for people who went to graduate school. While I was able to work during my undergraduate degree to supplement my scholarships, I was forbidden by Mississippi state law from working outside the university while on a graduate assistantship, which paid my tuition plus a minuscule stipend ($5,000 a year for my M.A., $9,000 a year for Ph.D., the rest of my money to live on had to come from student loans). None of President Biden’s plans offer any significant assistance for graduate student loans — for which the average student debt is $71,000. Most of us who received graduate degrees, especially in the liberal arts and education, did not do so because we expected high-paying jobs. Many of us did so to go into public service.

President Biden has offered the beginnings of great plans for many Americans suffering from student debt, but it doesn’t go near far enough. The cost of tuition in the United States is rising faster than at any time in history. In 1996 when I started my undergraduate degree, the average cost of public, four-year colleges and universities was $7,140 (inflation-adjusted: $11,460). The cost of tuition at my undergraduate university was significantly lower at $2,355 for tuition and fees, and I paid roughly another $900 for room and board (inflation-adjusted: $5,495). Luckily, I had scholarships that paid for most of that, so I didn’t have to take out student loans while getting my undergraduate degree. At my undergraduate institution, the cost is now $25,180. If you consider inflation, the current cost is nearly a 460 percent increase from 25 years ago.

In contrast, in 1977 (the year I was born), the average cost of tuition for public, four-year colleges and universities was $2,040 (inflation-adjusted: $8,430). From 1977 to 1996, the average cost of tuition only increased by about 135 percent if you adjust for inflation. If this trend continues, the average American will be priced out of getting a college education. If a person took out student loans to pay for their undergraduate education and decided to go beyond their four-year degree, they would go into a graduate or professional school already owing more than $100,000 in student debt.

The United States lags behind the world's major countries in the availability of affordable education and healthcare. The cost for both is astronomical and rising all the time. I realize Biden is more moderate and less progressive, which is one of the reasons I like him, but if something is not done to take control of the cost of education and healthcare in this country, it will come to a breaking point, and there will be a financial meltdown. Americans should not be punished for wanting to better themselves through education or keeping themselves healthy. If you are not wealthy enough to pay for your education outright and are forced to take out student loans, then you basically mortgage your life for twenty-five to thirty years. If you develop a chronic medical condition or a major illness, you will probably face medical bills beyond your control. The average American is punished for attempting to have a better life, and that punishment has to come to an end. Democrats want to help, but most don’t really understand the struggle the average American faces, even if they claim they do. Republicans only seem to care about the wealthiest of Americans and pursue policies to make sure that the average American never gets ahead. Republicans seem to be scared to death that their major contributors might have to pay higher taxes and pay their fair share. 

I don’t know what the answer is. I do know that we need greater regulation in healthcare and education costs. The government can and should help with both of these issues. It is not something that Democrats can afford to compromise over. The Senate needs to return the filibuster to requiring a person to actually stand up and talk to filibuster so that Congress can pass legislation. Congress has to increase taxes on the wealthiest Americans so that they pay their fair share. They have to get a handle on the American healthcare crisis. Education must be made affordable, and student loan debt must be dealt with in a meaningful way for everyone. Equality laws must be put in place, and voting rights must be defended. There is too much at stake to allow Republicans to block or slow down legislation to keep themselves in power. The majority of Americans favor significant reforms, but you’d never know that if you listen to Republicans or the conservative news media like Fox News.


BosGuy said...

I don't know what the answer is to this problem, but it does need to be addressed.

As you pointed out, the Trump administration's Secretary of Education, Mrs. DeVos, is a twat (my summation not yours). Hopefully the Biden and Secretary Cardona will be able to legislate or via executive actions address this issue more forcefully.

Cody said...

Well said, Joe. I owe nearly $60,000 in student loan debt. It feels like I’m drowning sometimes. We need fast action!

naturgesetz said...

It certainly seems that something has to be done tocontrol the costs of higher education and healthcare.

JiEL said...

Your education system is so much different than ours here in Province of Québec that your super high student loans are never seen here.

Education is a provincial administrative power and our university are well subsidized that a student pays only 13% of his tuition. The rest, 87% is paid by the education ministery of both provincial and federal governement.

We have student loans but the interests are very low and the way to pay back is according to the level of work and income he has after finishing his education time.

A year at a Canadian university is around $5000 to $10 000 per year.