President Joe Biden’s student debt forgiveness plan (should it be implemented) strikes a valiant compromise between those who preach fiscal responsibility and those who’d like to see all student debt erased.
Biden’s plan forgives up to $10,000 for borrowers making less than $125,000 annually ($250,000 for married couples). Individuals who’d received Pell Grants (awarded based on financial need) can get up to $20,000 in student debt forgiven. Certain policy changes will help current and future borrowers.
There are plenty of objections: It’s not fair to everyone who has already paid off their loans; it doesn’t help blue-collar workers who don’t have degrees; it will make government spending spiral out of control …
First of all, life is rarely fair, but forgiving some student debt actually helps make life fairer. Not everyone could work their way through school, or receive enough scholarships or grants to cover tuition, room and board (while costs have skyrocketed, most financial aid opportunities have stagnated), or rely on loved ones to help them pay for schooling or to help support them immediately after graduating so they could pay down their debt.
A $10,000-$20,000 loan forgiveness will eliminate the student debt of 20 million borrowers — including 74,000 West Virginians — while another 23 million will see their burden lessened (out of 45 million total student loan borrowers). The Department of Education estimates that nearly one-third of borrowers don’t get their degree but still carry the debt, which means this plan will help some blue-collar workers.
In other words, the entire $1.6 trillion in outstanding federal student debt is not being forgiven in one fell swoop. The government can still count on collecting some of that back as revenue. It’s similar to the 2017 tax cuts in that way.
Borrowers will be able to take the money they’ll be saving each month and put it towards other things, like retirement or savings, or a downpayment for a house or car. Maybe they’ll finally have the financial freedom to start a business or the stability to start a family.
Believe it or not, West Virginia will benefit immensely from loan forgiveness. When you look at professions that tend to rack up high student loan debt, most of them are in human services: teachers, social workers, doctors, nurses, psychologists, lawyers, therapists, counselors … the list goes on.
In a state suffocating under the weight of multiple crises — opioid epidemic, overwhelmed foster care system, teacher shortage — those are the very people standing on the front lines, working tirelessly to keep our state afloat. And with the possible exception of doctors (specialist vs. family practitioner) and lawyers (corporate lawyer vs. public defender), most of the above careers require one or more college degrees — and therefore more loans — but don’t pay a corresponding salary. For these essential workers, forgiving $10,000 is unlikely to wipe away their debt, but it may allow them to breathe a little easier while Biden’s new policies may encourage others to enter these professions.
