Student loan debt currently stands at 1.73 trillion dollars and is the second-largest consumer debt in the United States. The problem of student debt forgiveness was at the forefront of the presidential election in 2020 and remains a controversial issue today. I believe the government should cancel all student debt to reconceptualize higher education as a public good, reverse the institutional failures of universities, and alleviate economic disparities.
Firstly, the value of higher education itself has to be reevaluated. The narrative around college as a “means to achieve economic mobility” has been proven patently false (Charron-Chenier et al., 2020). According to Cottom (2017), between 2000 and 2002, college tuition rates inflated by 59%, compared to median salaries for professionals with an undergraduate degree rose only 5%. As more people gain degrees, job requirements rise; the result is a “trap whereby more education is required to get the same jobs” (Cottom, 2017).
Although student loans have been presented as a necessary sacrifice to earn more money in the long term, higher education has now become a basic requirement for minimum-wage entry-level employment. In light of these facts, undergraduate degrees should be regarded as a human right and become part of the public sector, similar to secondary education.
Secondly, post-recession academia is defined by its financial greed rather than educational value. In 2017, state funding for universities is “still roughly $10 billion below pre-recession levels after inflation” (Mitchell et al., 2017). As universities grew more dependent on students for a source of income, the priorities of these institutions shifted from educational to financial. For-profit colleges with no accreditation manipulate students into borrowing thousands of dollars for a worthless degree.
The victims of these “predatory educators” are “pushed into sub-optimal financial decisions…when they seek, but cannot afford further education” (Goldrick-Rab & Steinbaum, 2020). This is a part of the larger trend of academic capitalism that treats education as a commodity rather than a public good. The government’s failure to regulate higher education institutions has led to the current debt crisis, and student loans must be forgiven to reverse that damage.
Furthermore, canceling student loans will advance racial and economic equality. Making higher education an expensive product means limiting its access only to the privileged classes. In the context of the United States, this becomes a racially charged issue. Black and Latinx people are “forced to borrow at higher rates and in larger amounts due to racial inequalities in incomes and wealth” (Remington, 2020). Black borrowers own “smaller family wealth and have a harder time leveraging their degrees into higher earnings” (Charron-Chenier et al., 2020). Twenty years after starting university, “the median white borrower had paid off 94% of their debt, while the median Black borrower still owed 95%” (Remington, 2020).
Student debt causes a “deferral of economic priorities”: student debt is the “most common expense preventing first-time homebuyers from saving for a down payment”, getting married, having children, or starting a business (Charron-Chenier et al., 2020). Forgiving student debt will help overcome racial economic disparities and give more purchasing power to starting households.
In contrast, Timpf (2020) states that student loan forgiveness is built on a “premise that is false” because it unfairly pushes the responsibility of debt onto taxpayers. However, the United States government bailed out multimillion-dollar corporations after almost every economic recession. One must ask why it refuses to do so for the sake of its youth population. Public transport and secondary education are all parts of the public sector subsidized by the government, regardless of whether the taxpaying individual takes the bus to work, or has children to school. Higher education should be regarded the same way.
In conclusion, the current federal college loan system fosters economic inequality and institutional exploitation. Canceling debt would economically empower marginalized minorities who bear the disproportionate burden of debt, as well as shift the priority of educational institutions back to knowledge rather than profit. According to Goldrick-Rab and Steinbaum, a highly educated population leads to a strong democracy, economy, and society. Thus, the universal right to free education should extend to higher degree institutions.
Cottom, T. M. (2017). Lower Ed: The Troubling Rise of For-Profit Colleges in the New Economy. New Press.
Charron-Chenier, R., Seamster, L., Shapiro, T., & Sullivan, L. (2020). Student debt forgiveness options: Implications for policy and racial equity. Roosevelt Institute. Web.
Goldrick-Rab, S., & Steinbaum, M. (2020). What is the problem with student debt. Journal of Policy Analysis and Management, 39(2), 534-540.
Remington, A. G. (2021). Canceling student debt would narrow racial wealth gap and stimulate economy. Inside Sources. Web.
Timpf, K. (2020). Talk of canceling or forgiving student loan debt is based on a false premise. Fox News. Web.