The pros and cons of student loan forgiveness

As President Biden approaches the end of his time in office, the fate of his long-promised student loan forgiveness plan remains uncertain. Biden's plan, if permitted to proceed, would absolve borrowers of up to $20,000 in federal student loan debt if they earn less than $125,000 a year.

But once again in early October, Biden's efforts met a roadblock after what seemed briefly like a win. "In less than 24 hours the Biden administration won, then lost the ability to proceed with its new student debt relief plan that would deliver forgiveness to more than 25 million Americans," said The Washington Post. This latest attempt to thwart Biden's rule "stems from a lawsuit filed in September by seven Republican-led states," which "claim that the administration is exceeding its authority and illegally preparing to forgive loans before the rule is even in effect." Additionally, the states assert "the regulation would hurt state tax revenue and the earnings of state entities such as the Missouri Higher Education Loan Authority (Mohela)."

Even with this defeat, it seems the fight is still not over. "This lawsuit was brought by Republican elected officials who made clear they will stop at nothing to prevent millions of their own constituents from getting breathing room on their student loans," a Department of Education spokesperson said in a statement after the latest ruling, per The Hill. "We will continue to vigorously defend these proposals in court."

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Con: Forgiving debt is not fair to people who have already made their payments

Forgiving student debt would be a "great gift" to graduates, said the Boston Herald editorial board — but so would having your "mortgages, car loans, and … credit card debt" forgiven. "That's not on the table" though, because "adults who assume debt are supposed to be responsible and pay for the things they purchase." For that reason, others have called debt forgiveness a "slap in the face to all who sacrificed and worked extra jobs to pay off their student loans," said NBC News.

Pro: Debt forgiveness is the empathetic solution

But "the argument that 'this is how it was for me, so why should it be any easier for you' is a lazy interpretation of — and solution for — a crisis decades in the making," said Christina Wyman at NBC News. In fact, said Scientific American, harboring such resentment is just "another sinister layer in our country's long-standing problem with empathy."

"If a monster lives at the edge of town and makes a regular practice of eating bits and pieces of passersby, and after this goes on for years before the town finally brings in a monster hunter to put an end to it, do the people walking around with missing fingers because of past monster attacks have a legitimate complaint?" said Ben Burgis in Jacobin. "It's not unfair that they're finally taking care of the problem."

Con: Student loan forgiveness does not address the root problem and could even exacerbate it

Even though student loan forgiveness would offer a temporary solution for some currently burdened by debt, it would not actually "address the larger problem of soaring college tuition costs," said Marc Goldwein, the senior policy director at the Committee for a Responsible Federal Budget, to NPR. Instead, "it might make that problem worse — like a Band-Aid that masks a more serious infection underneath." If borrowers feel assuaged by this round of loan forgiveness, others might feel less hesitant to take on debt in the future. "People are going to assume there's a likelihood that debt is canceled again and again," said Goldwein. "And if you assume there's a likelihood it's canceled, you're going to be more likely to take out more debt up front. That's going to give colleges more pricing power to raise tuition without pressure and to offer more low-value degrees."

Pro: An imperfect solution is better than nothing

Unburdening student loan borrowers with the sweep of his pen "might not be the best form of stimulus available" to Biden, said Annie Lowrey at The Atlantic. "Nor would it fix the country's crushing student-loan crisis, or rationalize its higher-education financing structure." But even if debt forgiveness won't instantly solve America's problems with access to higher education, financial equality, or stimulating the economy, "this is a yes-and situation, not an either/or one." While student loan debt would benefit the wealthy too, "giving money to rich people does not erode the benefits of giving money to poor people." People shouldn't get too hung up on the policy being "ideally progressive," either, Lowrey said, because "the principle matters here too. The fact that higher education should be a public good matters."

Con: Many with student loan debt do not actually need help paying it off

Proponents of canceling student debt say it would help relieve the financial burden on lower-income students who sought higher education. Yet "in 2019, the average graduate of a four-year, non-profit college who took on loans left school with only about $29,000 in debt" while "the average four-year degree holder makes six to seven figures more during their life than someone" who only went to high school, said Neal McClusky, the director of Cato's Center for Educational Freedom, in Divided We Fall. "Student debt is not only often manageable, for many, it is quite profitable." Indeed, "students from families earning more than $114,000 a year borrow at the same rate as the lowest-income students — and they take out loans nearly twice as large," said Emma Ayers at USA Today, adding that "those who decided to sign 10 years of their future paychecks away on the dotted line at the loan office shouldn't get the most reprieve simply because they spent the most."

Pro: This is not your father's student loan crisis

People who attended college in the 1968-69 school year paid $1,545 a year, adjusted for inflation, for tuition, fees, room, and board at a public four-year college, said CNN. "If education costs remained in line with inflation, that number would be around $12,000 per year" today — instead of the $29,033 it actually cost in 2020-21. There are students today who cover those costs with loans and manage to pay them after leaving college, "even without starting salaries so high that they invite nosebleed," said Erik Sherman at Forbes. "Then again, there are people who can run a four-minute mile" and "memorize the first hundred digits of pi." For all the "finger-wagging" about student debt, it's worth remembering that "what was once possible — 'Oh, I put myself through college working for $100 a week during the summer when gas-powered streetlights lit the sidewalks, so why can't kids today?' — no longer is for many, if not most. To pretend that it is becomes a different form of gaslighting."