b a t t l e g r o u n d . . . . . . . . . . . . . . . . . Danyal and K atie debate whether the United States should forgive student loan debt on a federal level, an idea which has gained trac tion as student loan burdens increase and payment continues to be difficult. student loan debt, it is reasonable to expect hile campaigning back in March of an increase in the cost of attendance at 2020, President Biden announced colleges and universities. Additionally, the his intention to relieve a minimum of temporary relief provided by the bandage $10,000 in student loan debt per borrower. that is student loan forgiveness would And recently, lawmakers have been pushing quickly fade, with the CRFB projecting Biden to take his generosity one step further student debt returning to its current level and forgive $50,000 per person for the over by 2025. 43 million borrowers. But the idea of this What may last though are the negative “forgiveness” sounds much better in theory economic repercussions. Debt cancellation than in practice. would lead to a substantial increase in the According to an analysis done by the spending ability of former debt-bearers. A Federal Reserve Bank of New York, Biden’s total debt cancellation, the CRFB reports, original $10,000 plan would cost the would lead to a 10-50 point increase in government $321 billion. And according our 40 year high inflation rate. So while to the CRFB, a full debt cancellation the idea of relieving the burden borne by would cost $1.6 trillion. With the Biden our nation’s students may seem beneficial, administration’s extensive pandemic relief we must also consider the implications of spending as well as the $30 trillion dollars government intervention at such a scale. in federal debt reported by the Treasury, With forgiveness not having any loan forgiveness would only exacerbate the elements of sustainability and giving rise to country’s own debt crisis. And in doing so, more issues for the United States’ economy, borrowers will not be as relieved as one the Biden administration should not hastily might expect. cancel any portion of debt for every single With the government subsidizing borrower.
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n 2010, Americans owed a combined $845 billion in student loan debt. While this number is incomprehensibly daunting, in no way does it compare to the $1.71 trillion owed in 2020. Whether it’s due to rising demand, increased financial aid opportunities, or pure greed from those at the top of prestigious institutions, the cost
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of higher education has been increasing. The political discussion of eliminating student loan debt on a federal level has parallelly become more driven, with proponents such as Rep. Cori Bush and Sen. Elizabeth Warren taking the lead. President Biden should eliminate student loan debt for those who attend private institutions, because it would properly boost the economy and lead to a more socially fulfilled country. President Biden should enact greater student loan forgiveness for people who attended public universities because it will generate healthy economic growth. Student loan debt is burdening the economy. Per the Federal Reserve, there is “a significant and economically meaningful correlation” between holding student loan debt and owning a failing business. The impacts domino from there: failing businesses mean unemployment rises, consumer spending decreases, burdening the country, fulfilling their career aspirations while boosting economic revenue. When a select group of people cannot take part in the economy, the economy weakens. Secondly, forgiving student loan debt will lead to a more socially fulfilled country. Student loan debt delays life-fulfilling milestones such as marriage, buying a house, and saving for retirement.The President has
the unique ability to grant people quicker access to a more fulfilled life. He can do this in two ways: firstly, he can just plainly wipe loan debt away; secondly, he can allow people to file for bankruptcy for a new start, which is currently impossible due to an 18th century law. By opening avenues to forgive student loan debt, President Biden would cultivate a more productive, happier country. While the economic and social benefits of student loan debt forgiveness are enticing, opponents argue that student debt reaches the important principle of financial responsibility. In fact, a 2020 survey revealed that almost half of Americans believe that forgiving student loan debt is a slap in the face to those who have responsibly worked to pay off their debts. However, it is unrealistic to trust an 18 year old student’s judgment and economic choices. These students are often deluded by possible salaries, or are simply naive teenagers who do not understand the consequences of student loan debt. We have the power and the ability to free people from the weight of financial debt, a weight that they probably did not even understand. Biden should forgive student loan debt in order to stimulate the economy, create a fulfilled population, and ease the burden placed on naive teens.
4| Current Events
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