The Debate on Whether the Government Should Forgive Student Loan Debt

More than 40 million Americans have student loan debt. Should the government forgive all or even or part of it?

September 26, 2024

Over 40 million Americans struggle with student loan debt, sparking a fierce debate on whether the government should forgive it.

This issue has become a major political flashpoint. Critics argue that student loan forgiveness is a wealth transfer from the lower to upper socioeconomic classes. Proponents contend it provides relief to graduates burdened by repayment costs, often without even having completed their degrees.

Rising college costs are delaying life milestones such as marriage, starting families, and homebuying, which are essential for economic growth.

This article explores the pros and cons, shares perspectives from student loan holders, and offers advice on avoiding debt.

Listen to the whole series

TRANSCRIPT

(Voice of news host)

It’s Morning Edition from NPR News. I’m Leila Fadel. More than 40 million federal student loan borrowers had an eventful year. It began with a promise of forgiveness. Then they were unforgiven. And now some may be forgiven again. …

Jon: The student loan debt situation has been a roller-coaster for decades.

Kirk: Promises of forgiveness, lawsuits, and more promises have created a political minefield. People who didn’t attend college or paid off their loans don’t understand why they should pay for others who haven’t. This class divide is easily exploited by politicians.

Virginia Foxx: There’s no such thing as forgiveness. This entire scheme is nothing more than a transfer of wealth from those who willingly took on debt to those who did not or paid off their loans.

Kirk: This podcast, College Uncovered, reveals how colleges work. We’ll discuss student loans, their politicization, and how to avoid debt.

Jon: Today on the podcast: “The Borrowers’ Lament.” Arti Sharma, one of 44 million Americans with student loan debt, shares her story.

Arti Sharma: My family couldn’t afford college, and I didn’t have enough scholarship money. I borrowed for college and law school, but now I work in public service and can’t repay my loans.

Jon: Sharma is one of many who feel trapped by the system. Forty percent of borrowers don’t graduate, leaving them with debt but no degree. The average debt for a bachelor’s degree is $26,000, which can balloon to $43,000 with interest. This debt delays marriages, families, and homebuying.

Arti Sharma: My parents, working-class immigrants, bought a house and raised a family without loans. Despite my degrees, I don’t have comparable net worth.

Jon: This sentiment fuels the debate on student loan forgiveness. A poll by NPR found a narrow majority support forgiveness, but those without debt are less likely to agree.

Andrew Gillen: Forgiving student debt is a regressive policy. College graduates earn more, so forgiving their debt benefits the rich at the expense of the poor.

Persis Yu: The student loan system is broken. Forgiving loans would relieve burdens and benefit communities.

Jon: Both experts agree colleges should be accountable for rising costs. Income-driven repayment plans and public service loan forgiveness can help, but avoiding debt from the start is crucial.

Sameer Gadkaree: Carefully choose your college and program. Use data from the College Scorecard to ensure your degree will lead to sufficient income to repay loans.

Kirk: High school students should take Advanced Placement or dual enrollment courses, and families should fill out the FAFSA for maximum aid. Negotiate for more financial aid and choose schools with lower tuition.

Jon: Some schools promise no loans, especially those with large endowments. Study hard to qualify for these institutions.

Kirk: Arti Sharma’s story highlights the frustrations many face. She’s applied for public service loan forgiveness but is still waiting for relief.

Arti Sharma: I feel bamboozled by the system. You trust the government when you’re young, but it ends up feeling punitive.