Student Loan Forgiveness: Good Idea or Socialist Giveaway?

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Student loan forgiveness is one of those topics that you’d hope would be fairly straightforward and uncontroversial, but as with anything to do with US politics, nothing is ever straightforward and uncontroversial.

When President Biden announced that he was going to cancel up to $10,000 of federal student loans ($20,000 for Pell Grant recipients) at the beginning of the year, that was already a massive compromise. He had campaigned on eliminating all student debt for people earning less than $125,000. But then the 50/50 split of the Senate he ended up with meant that he couldn’t fulfill this promise without Republican support (which they weren’t going to give), so he had to do this in a much more limited form through executive action.

So I kind of figured he would get push-back from the more liberal wing of the Democratic party upset that he couldn’t fulfill his campaign promise of cancelling all student debt. What I wasn’t expecting was the borderline-psychotic rage from Republicans and even moderates over this, with talking-head news pundits comparing it to everything from a Communist ploy to a Satanic plot.

Which…sure. OK, people. Glad we haven’t gone nuts or anything.

But I thought it would be interesting to examine some of the arguments against forgiving student loans floating around the media right now and see if any of them hold water.

It Only Helps Rich People

The idea that forgiving student loans is somehow an immoral giveaway to rich people is the most prevalent and baffling argument against this program.

Quick show of hands from anyone who currently has a student loan balance: Are you rich?

For the vast majority of people out there, the answer is a resounding no. Because of course they aren’t. If they were rich, they would have paid off their loan balance already.

People who get into 6 figures of student debt, but then land a top notch job on Wall Street aren’t the people who this program targets. In fact, this program imposes income limits for applicants, meaning if you earn enough to pay off your debt, you aren’t eligible. According to White House figures, the program is structured so that 90% of debt relief goes towards people earning less than $75,000.

The people who are most drowning in student debt are those that took on huge loans for either useless degrees that didn’t translate into high-paying jobs, or people who didn’t finish their programs and as a result are stuck with the debt but not the benefit of going to college. These are the people who are trapped in the vise of student debt, watching their balances rise every month because they can’t keep up with the interest charges, and will never be able to retire if they can’t find a way out.

These people desperately need a lifeline, because unlike every other loan, you can’t even declare bankruptcy to get rid of student debt. And while $10,000 may not be enough to completely fix the problem, it helps.

It’s a Slap in the Face to Responsible Borrowers

This one actually makes more sense to me. While this program helps people currently in debt, it excludes those that have been diligently making payments. Essentially, by forgiving people’s student debt, you are punishing those who either never went into debt in the first place, or who have successfully paid their balances off.

And I get why that seems unfair. Nobody wants to be punished for doing the right thing.

That being said, if everyone had the attitude of “It was hard for me so it’s not fair that others get a break,” then no progress would be made on literally any issue. The student loan crisis in the US is an unsustainable mess that keeps getting worse every year, and for those people who managed to avoid or escape it relatively unscathed, great. The system worked for you.

But there are thousands of people who get trapped in that same system every year through no fault of their own, and the consequences of being trapped in that system mean they are going to be stuck in a cycle of debt for most of their adult lives unless they get help.

The system needs to be fixed, and while we might disagree on exactly how to fix it, if we don’t all agree that the system needs to be fixed, then it never will be and future generations will be doomed to repeat the mistakes of the past.

It Doesn’t Reduce the Cost of College

The crux of the student loan crisis, some argue, is that college costs just too damned much. If college didn’t cost six figures for a crappy arts degree, then student loans wouldn’t be such a huge intractable problem. And forgiving $10,000 does absolutely nothing to fix that.

To that, I respond: Amen, brother!

They are absolutely right.

College costs in the US are already astronomical, and getting worse. According to, the average cost of college has more-than doubled in the 21st century, with an annual growth rate of 6.8%. And that was during the years when inflation was at 2%. God only knows how much tuition is going to jump in today’s high-inflation environment.

However, the solution to this problem is not less loan forgiveness. Quite the opposite.

Let me explain.

Right now, the student loan program in the US is structured so that it’s easy to get into debt, but almost impossible to get out of it. This means that the most profitable users of this program are not the ones that are able to get a high-paying job right away and pay it off over the next few years. Instead, it’s the people who got into an insane amount of debt getting either a useless degree, or not finishing at all.

Those people are stuck with the debt, no high-paying job, and no easy way to discharge the debt (unless they work for a non-profit via the PSLF program). These people are going to be stuck perpetually paying off the minimum allowable amounts on their debt, which may not even be enough to cover the interest (especially if they’re on an Income-Based Repayment plan), which means that their debt just keeps growing and growing forever. Over the course of their working lives, these people will end up paying many times more than the original loan amount.

In other words, these people are cash cows.

And the thing about capitalism is that whenever a certain type of behaviour turns out to be very, very profitable, guess what? The system reconfigures itself to encourage more of that type of behaviour.

In this case, the extremely profitable behaviour is to trick young, gullible idiots students into overpaying for a useless degree. Both the lender (in this case, the government) and the college mutually benefit, so this creates a positive feedback loop where the college can keep hiking prices and the lender gets to profit from saddling that poor sap with ever-growing amounts of debt.

The solution to breaking this feedback loop is to create a way for students in this situation to discharge their debt either through bankruptcy or an automatic loan forgiveness program.

The reason why this works has nothing to do with empathy or compassion. It’s just cold hard economics.

Basically, the system has to be set up so that either the lender or the college lose money when a student gets saddled with debt that they can never repay. If the lender lost tens of thousands of dollars whenever a student defaulted on their debt, they would become a lot more careful about who they lent money to, and towards what degree.

Six figures for a medical degree? Sure, that makes sense because that student is probably going to be able to repay their loan. Six figures for a Masters of Fine Arts? Whoa whoa whoa, pump the brakes there buck-o. No way would a lender write a check that big if they’re worried about that student defaulting on their loan because they can’t find a job that pays enough.

That refusal to underwrite loans for useless degrees would create downward pressure on tuition prices. If students can’t afford the sticker price, and lenders aren’t willing to fork over loans to cover it, then colleges would be forced to charge less, and that would stop the cycle of infinitely rising tuitions that the US finds themselves in.

That’s why countries that have more robust student loan forgiveness programs like the UK, Canada, or Australia don’t suffer the same sky-high tuition problems that the US faces. The current student loan system encourages colleges and lenders to hike prices into the stratosphere regardless of the usefulness of the degree the student is getting.

Does It Help Our Readers?

This $10,000 loan forgiveness program is a one-off band-aid solution. It was never meant to solve the much larger problem of student debt reform. That will require a legislative solution, and given the numbers that exist in Congress right now, that would require either a bipartisan effort or a future administration.

For me, the question of whether a policy is a good idea or not basically boils down to: Does it help our readers get closer to Financial Independence?

In this case, it’s a resounding yes, and for that reason alone I’m all for it. As an example, I recently got this email from a reader the other day…

Hi guys!  I just wanted to email you about this post I vividly recall reading in the middle of the night back in October 2021.  

I had approximately $42000 in federal student loans that were on pause with the covid situation.  

After reading this post I recalled thinking to myself, well why not? Despite my loans not even applying to my current profession as well as the bulk of my work history working at non-profit hospital, I felt it was still worth a shot.  Two of my three other employers were more clear when it came to qualifying for public interest (Ie state employer and federal employer).  

I sought out HR departments and ran down needed signatures verifying and certifying my work history and then waited.   And waited.   And waited.   Actually I really kind of gave up on hearing about it only until the recent Biden announcement about 10K loan forgiveness.  And so based on that I came around to checking my original MyFedLoan servicer messages and sure enough, there was a letter, dated back in June 2022, congratulating me on having my work history certified and having the entire loan balance of $42000 completely forgiven based on public interest loan forgiveness.   I didn’t need to be concerned with the 10K announcement as I had originally thought.  

I couldn’t believe it, but it was indeed true as I’ve since confirmed with my credit reports, showing a zero balance.  

And so I just want to thank you all for this post.   No one really encouraged me to follow up on this or guided me through the process, but it was your post I read at 3AM that started it all for me.  It’s a life changing result because it allows me to focus on continuing to aggressively save for retirement as well as contribute to my son’s future educational expenses.  

Thank you for being there for all of your readers and contributing all that you do.  

Please see below for my loan forgiveness letter. Hope more of your readers can have similar results like I did!

It’s amazing and humbling whenever one of you reads this site, goes home, and actually changes their financial lives as a result. That’s the reason we keep writing this blog!

So if you’re reading this, and you have more than $10,000 in student debt ($20,000 if you’re received Pell Grants), please apply for the program by clicking here. As of the time of this writing, the program is still paused due to the ongoing lawsuits being filed by Republican states, but if you apply now they can start processing your application as soon as the court cases wrap up.

What do you think? Do you think the $10,000 student loan forgiveness program is a good idea? Let’s hear it in the comments below!

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119 thoughts on “Student Loan Forgiveness: Good Idea or Socialist Giveaway?”

  1. Socialist giveaway obviously, with mid-term political gain in sight!

    Far from being a solution for a problem or anything like what. What if my kid is applying for a student loan today? What forgiveness can he count on? It’s all socialist BS

    1. Vote out the Republicans and maybe your kid won’t have to get on his knees and beg for forgiveness that will never come. You can’t oppose the solutions and then complain about the problem.

      ARB–Angry Retail Banker

      1. If I want to buy something with a loan that was my choice and I alone owe the money. But it would be WRONG for me to buy something and hand the bill to the taxpayers!!!!! This administration is the most corrupt, fascist, and downright dangerous in the history of the United States. Biden and Harris are a complete disgrace.

    1. “Socialist bs for left wing votes”? Well, yes, generally speaking, the plan is for people to vote for politicians who do good things and against politicians who do bad things. I know Republican voters exist in an opposite land where they vote for child sex criminals and anti-LGBT propagandists because their favorite Fox News pundit told them to during his pro-Nazi spiel, but the general idea is that we’re supposed to reward with our votes those in power who do good things like easing the financial burdens of millions of young people who fell victim to a corrupt system of predatory debt, grift, and cultural gaslighting.

      Also, the whole “Heh, you got your loans. Now pay them off like I did!” argument? Can we just not pretend that isn’t the most piss-baby argument out there? I still have a few years to go on my mortgage. If mortgage relief were announced the day after I paid mine off, sure I’d be pretty disappointed that I didn’t get to benefit from it. But I wouldn’t use that as an excuse to oppose relief for others. Because I’m not a toddler.

      ARB–Angry Retail Banker

      1. Says I’m not a toddler yet goes on a fictitious political rant…

        I especially liked the accusations of child sex crimes, I mean isn’t that what the socialist regime formally know as the Democrats pride themselves on? Child grooming and protecting pedophiles, I meant “minor attracted persons” as you liberals call them.
        Also not wanting boys pretending to be girls in girls bathrooms, locker rooms and sports and not wanting pedophiles talking to 5 years about sex isn’t anti- LGBTQLMNOP+ . It’s common sense and shouldn’t be a partisan issue.

        You should stop holding onto so much misplaced hate for such a large group of people you don’t know. You sound a lot like what you claim the people you hate are.

        The problem with loan forgiveness is it does absolutely nothing, it’s a sorry attempt to buy votes. The irony is the vast majority of people this will benefit will be to lazy to vote anyway.

        You learn at a very young age you borrow something you pay it back. When your 5, you borrowed a ball from your friend you give it back. When your 25 you borrow money from a friend and gamble it away it’s not your friends fault, you still pay him back. Nobody is a victim they chose to borrow the money made poor decisions and shouldn’t be allowed to skirt responsibility, end of story, This liberal nonsense of being offended by everything under the sun and sense of entitlement is becoming beyond ridiculous nothing is a given right and nothing is free.

  2. Agree 100% with the comments before me. Socialist crap. I was able to go to College without Loans. Parents saved for it as did I. Worked during College and actually got a Degree (Criminal Justice) that is marketable. We have to stop enabling people and demand responsibility from them. Arrested development is not a winning plan. enjoyed your book and this blog, keep it up.

    1. Was this back before tuition was as high as it was now? My dad went to college in the mid-1970s, and the only thing he had to pay was a $50 admission fee. It’s not the mid-1970s.

      Your inability to recognize how times have changed and how socioeconomics have put young people into a lifetime of unsustainable debt is not “arrested development” on their part. It’s a you-problem.

      ARB–Angry Retail Banker

      1. Yes, your dad got the privilege of going to college before the government decided to involve itself and loan kids money and guarantee repayment by making them unbankruptable. He got to go to college before the money spigot got turned on. Turn it off first, then forgive. At least that makes some sense.

        1. “Turn it off first, then forgive. At least that makes some sense.”

          Turn it off and forgive can be done simultaneously. Agreed that there’s an underlying systemic failure. That wasn’t your argument before, though, but we can come together on where it is now.

          1. I’m glad you agree, doing anything prior just doesn’t make sense. I’m all for fixing issues permanently, not patching.

            1. Oh, no no no, I never said anything about fixing the system before forgiveness. That’s how we wheedle out of doing the former. No, I said both simultaneously.

      2. Reagan was right when he said to be ware of the government getting in your business; the government rarely gets anything right or does anything efficiently.

        These student loans have had zero interest accrual since March 2020, a lot of industrious people have taken advantage of that and paid off a lot of their debt and these are the folks who will make it. Anybody sitting around whining about their debt from their mommy’s couch is never going to amount to anything.

  3. Clearly a socialist giveaway to buy mid-term votes. Because few people will want to vote for the existing terrible policies of the current administration.

    Further than that, let’s say you went to trade school or became an apprentice as an HVAC technician, plumber, electrician, etc. then spent $60,000 to buy a van and outfit it with tools and parts to start your own small business. Not only do you get to continue to pay off that, you also get to pay off someone else’s student loan.

    This will be the last article I read from your site. How anyone can remotely think this is a good idea is morally bankrupt.

    1. “Clearly a socialist giveaway to buy mid-term votes.”

      Yes, crazy idea isn’t it? Government does good things for people; gets rewarded with votes. This is like complaining that a business only gave you the best quality product or service because they want your money.

      “How anyone can remotely think this is a good idea is morally bankrupt.”

      I could talk about how the left and the right generally have two separate foundational societal moral beliefs favoring equality and hierarchy, respectively. But that would just be tapdancing around the point that the people who somehow think this is morally bankrupt are the same people who want to cut school lunch programs because poor children “don’t deserve” a hot meal because their parents didn’t work hard enough.

      ARB–Angry Retail Banker

      1. These comments make me sad. I recommend you read Mr. Money Mustaches’s recommended reading, The Molecule of More. It explains really well the differences between Republicans and Democrates. Neither party is evil, though those in power would like us to think so because it makes their jobs easier. If we just get angry and don’t think, then we don’t pay attention to what they are doing, which is basically never solving any problem. Even ones they created like the student loan crisis. I wish you well. I have friends on both sides of the aisle and they are all great people.

        1. “It explains really well the differences between Republicans and Democrates. Neither party is evil, though those in power would like us to think so because it makes their jobs easier.”

          The war cry of the enlightened centrist who “can’t tell the difference” between the party whose candidates want to give everyone healthcare and the party whose candidates want to force trans people into camps. This is what someone who doesn’t follow politics says to make others think they follow politics.

          1. No enlighten centrist here, just a person trying to help the extremists such as yourselves take a look in the mirror. I can’t think of a single person I know who doesn’t think Healthcare needs to be fixed and who isn’t sympathetic to a trans person. However, these issues are complicated. For example, turning Healthcare over to the government makes me nervous based on what they did to college tuition prices.

            1. “I can’t think of a single person I know who doesn’t think Healthcare needs to be fixed and who isn’t sympathetic to a trans person.”

              You really aren’t following the national discourse, are you? You don’t have to convince me of it, I can already tell.

              “For example, turning Healthcare over to the government makes me nervous based on what they did to college tuition prices.”

              It makes excited based on how well every other developed nation’s healthcare system is compared to ours. I know, I know, it won’t work here because “It’s complicated. See the last thing I wrote in my previous reply.

              1. The problem is they aren’t doing that well. Getting in to the doctor you need can take over a year. Also the R&D isn’t well funded. There are lots of other issues as well. I think things need to be fixed. I just don’t think the government taking over is the best option, think the VA here. Also, I keep up with the news but still manage to think for myself. For example even the title of this article is a bit of click bait isn’t it. The word forgiveness sounds lovely but really that’s not what’s going on. They are just switching the burden to the taxpayer. So forgiveness provides a shield for politicians. You’re against forgiveness! Why you must be – fill in the blank with a bad word. Also, socialist giveaway is a bit of bs too. Designed to ruffle feathers instead of welcoming various opinions and solutions to the table.

  4. Sorry my friend… while I love this blog and a lot of the financial advice you provide many people, but this is an area I think you haven’t dug in deeply enough.

    The perverse incentives of this very regressive loan forgiveness are innumerable, and I don’t think you are seeing the big/long term picture here.

    This action, like much of our loan policy for the past few decades, is extremely inflationary.


    I think also points to the fact that ultimately a lot of this lifestyle is on very temperamental grounds at times, whether market returns or tax loopholes that can change at any moment.

    Look, I get that this will help a slice (especially given that FIRE tend to be high-income earners, like the ones who get the pricey degrees this loan forgiveness helps most) but that doesn’t make it good policy.

    In the end, I don’t see how anyone can look at this other than a naked bribe slippery slope. Particularly given the overall raging inflation we have right now due to unsustainable government spending (particularly poorly targeted and unnecessary COVID spending, too much of which like this loan forgiveness goes to high earners that don’t need the safety net)

  5. I really am not on board with student loan forgiveness, it feels like dangling a carrot for votes and it does not solve the bigger issues with College loans these days. First of all, do they ever look at how much it costs to go to a college? The costs are a rip-off, the education is not any better than when I went back in the early 90s. Most of the instructors are adjuncts, who work for peanuts, so where is that money going? The other issue is, why is student loan debt something that can’t be written off through a bankruptcy? You hear stories about people having their SS garnished for this. It’s disgusting.

    Last point, do you really need a college education to be a productive human on the planet? When you make that choice, you see what it costs, why would you do it? Unless you are choosing to be a doctor or lawyer, you know when you sign on the dotted line that you will have to pay x amount back, so why commit to that? Try something else instead, try a trade or even a bootcamp.

  6. Allow delinquent private loans to be discharged in bankruptcy. This will have the effect of making the lenders much more cautious in who they lend to and how much they will let people borrow. Keep the Pell grants and max govt loans at $5,000 per year for five years. Thus, poorer students can still get some help, but would graduate with no more than $25,000 of debt. This would force colleges to start lowering tuition and would also prioritize students to work more part-time and summer jobs in order to pay for their education. This is all good in my book and this is what I did.

  7. Wow! Just wow! The comments from your readers are unbelievable. As an Australian who lives in Canada this just highlights how selfish and narrow minded the majority of US citizens have become. If there isn’t something in it for you and it will give some one else a break – it’s wrong… how does that make any sense.

    There are lots of examples of government funded programs in Canada that I’m paying for, that I will never be eligible for or able to take advantage of (I would imagine the same applies to Wanderer) but do I feel it’s unfair? No, of course not. I’m glad the country I live in believes it’s citizens may need a hand from time to time and I am fortunate enough to contribute. Do I love paying taxes – of course not!

    But I see the good in it everyday – the people I work with who are able to take a full 12 months of maternity/parental leave to bond with and nurture their babies. If you have a close family member who is terminally ill – paid time off to help them.

    I actually feel sad that people are so selfish that they don’t see that helping others in the long run helps them.

    1. I’m American and I don’t understand it either. If anything, the past few years have emphasized to me the need to pull together and help each other out.

      I used to be Republican. My first vote went to George W. Bush. I do not recognize my old party. Good riddance to them, I hope they become unelectable and never hold power again. All the competent people have fled to the Democratic party anyway, so I’m happy to vote for them.

    2. I think the lack of empathy amongst many Americans has to do with their cynical view towards college. In the US, going to college is now viewed as a “lifestyle statement” more than anything else. The sense is that most college degrees are worthless (excluding STEM/Business degrees), and college is seen as little more than an additional 4+ years after high school to party and have fun, with student loans available for a new car, house down payment, or a gap semester vacationing overseas.

      …I’m not saying this is right, but that’s my read on the situation.

      1. Or perhaps it has to do with the perception that people today refuse to take responsibility for their choices (especially the bad ones). As is commonly known, when responsibility and consequences are taken care of by someone else, no lesson is learned. If someone wants to borrow a couple hundred thousand dollars for their lesbian poetry doctorate, they NEED to deal with consequences, or nothing is learned.

    3. Frustrated and embarrassed American over here. Well said Debbie and others who agree.

      As a former teacher and one who has studied history, specifically 19-20th century European and American social movements, I can say that when someone claims “socialism” when they hear about a government program that helps people I know that they are gravely misinformed. There are different iterations of socialism – the Eastern European version, the ideological one, etc. – but none of them involve a program such as this. There is no government ownership or takeover of the means of production and no private property is being abolished. And I also find it a bit humorous when right wingers accuse Biden or whoever of “buying votes.” Republicans work so hard to funnel wealth upwards that their followers assume sinister intentions when the government actually tries to help people and right a wrong. They are telling on themselves and they have no idea.

    4. Agreed Debbie! While student debt relief won’t solve the problem, it is a step that is necessary to help so many people. And hopefully the next step will be to make University more affordable in the States. Otherwise, only students with family wealth will be able to get degrees, resulting in even great disparities than already exist.

    5. I feel like this is the knee jerk reaction of so many people. But it is the wrong reaction. First. people need to understand government only spends and uses taxpayer money. They aren’t forgiving anything. The taxpayers are picking up the bill. This includes people who decided against going to college because of the price tag. Second, our government came up with the brilliant idea to back student loans and make them unbankruptable. The colleges are think this is great and have responded by building fancy dorms, huge stadiums and charging more. Banks wouldn’t loan an 18 year old that kind of money because the risk is too high. So the government created this problem and won’t fix it. Paying off loans while still making loans to current students! None of this makes sense. It is also quite amusing when they describe the loans as predatory! They made them!!!! Colleges have huge endowments and operate tax free! The whole system needs an overhaul, but this is only a campaign hustle to buy votes. Both polictical parties in the US are corrupt and do not have the average person’s best interest at heart. The more people realize this and stop being fed incorrect information the better off we might be at actually electing people who would fix something and not just pit us against each other.

    6. So agreed Debbie!

      There are a lot of truly bizarre takes in this comments section. I can only assume that they’re not regular readers because they seem to have not understood a thing about it.

      I think student loan forgiveness is necessary and good. I think the program is okay (though not enough, for the reasons outlined above), and would make a difference for many Americans.

      I also think it needs to be the first of many steps fixing their whole system. There’s no way you should be able to borrow $X, make every payment on time and in full for two decades, and then owe $X $Y at the end of it. And have your loan sold to different companies making you ineligible for debt relief programs without your consent.

      Horrible system. Horrible. And it’s holding Americans back.

    7. The selfish thing is making people who managed their debt, did not go into it at all, or receive high end degrees that make them on average a million dollars more over their lifetimes (!!!) pay the burden of the highly educated whose debt will prove worth it via higher lifetime earnings.

      This entire policy is largely regressive, and could be targeted. Couples earning ~ $250k per year do not need their debt forgiven.

      Never mind that again, the only effect of this will

      1. Inflate the price of education
      2. Demand future bailouts for people who are better off than the people footing the bill

      Sorry my friend, but the economics of this policy are disastrous. As is the manner with which it is being attempted by executive fiat rather than Congress.

    8. Completely agree.

      Also from the perspective of an Australian on the article more generally – firstly I wouldn’t call our scheme any kind of robust loan forgiveness at all, as far as I’m aware unless your course was provided through a dodgy provider, you’re up for payments (once you earn a certain amount), unless you pass away in which case then any remaining debt is wiped.

      What I really can’t understand is the US system to begin with – it seems inherently set up to set people up to fail, then embracing the idea of those failures as the fault of the individual rather than the system, despite the volume of people impacted.

      I don’t think that forgiveness is necessarily a long term solution at all but without major changes testing circuit breakers like this the issues surely would only get worse. I’d like to see the modelling around dollars that would flow back into the economy once people are not making repayments on these debts (or even better, the real world data in a couple of years).

    9. Well said Debbie! As a US/Canadian dual citizen who lived in the US until moving to Canada in my 20s – the biggest difference between the two countries is the peoples attitudes. Canadians are much more community focused vs Americans are much more individualistic. I too am sad to read all these comments above.

  8. Actually, the student loan forgiveness is a lot better once you dig in a little deeper. It carries a provision where your minimum payment will be pegged to 5% of your income and if you make those payments, you are not charged interest. So now people who don’t make it into a high paying job at least have a chance to pay it off.

  9. Thanks to Debbie above for finally being a voice of reason here. Honestly, reading the other comments, particularly from those in the US, is just baffling. Perhaps in the short term there are some drawbacks, but US tuition is absolutely ridiculous and this needs to be addressed.

    I’m not sure if this exact delivery method is the perfect implementation of this kind of program, but overall, something absolutely needs to be done about the massive injustice that is the cost of education in the US.

    Socialist giveaway? The wealthy who don’t feel the effects of the costs are healthcare and education are basically already living in socialism, whereas the low-income folks with so few options are basically living in feudalism with no real opportunity for advancement or change in their circumstance.

    To those saying: “I saved up and paid for it, and so should others”, get f******. This is ludicrously short sighted. It is too late in the day for your “I did it so others should too” capitalist ideology to justify the continuation of a broken system that impoverishes those who want to study in College / Uni, regardless of the direct work application of that learning.

    I teach students online who want to study animation, and it is cheaper for U.S. students to pay double the price (for international student rates) and attend a Canadian animation school, than to attend a school in their home country EVEN after receiving many scholarships. It is absolutely absurd, and makes me furious as a teacher who knows the difficulty of paying off student loans while also living in a time when the cost of living has increased dramatically, while wages haven’t (not to mention any of the various workplace issues of working in short-term contracts in animation) in any consistent way.

    Clearly there are far too many attracted to FIRE who haven’t felt the true ill effects of this system.

  10. “Borderline psychotic” for disagreeing with your view? Really? “and for those people who managed to avoid or escape it relatively unscathed, great. The system worked for you.” I think you are missing a deeper issue here. As a parent sending my kids to college, I had to make it work. I sacrificed a lot to save for their education. A LOT, while others did not and their kids will be rewarded, while my kids will be “rewarded” with a tax burden that this program creates. Lastly, the system is not as broken as you think. There are plenty of affordable colleges and programs out there, that will prepare our children for the future of work. The issue is that kids (and their parents) continue to choose overpriced institutions, refuse to save for this event and pursue degrees that will not pay off. I would be open to the government subsidizing post high school education if the government could pay its bills and remove the debt situation, but it is evident that Congress has no interest in doing so.

  11. One solution is to put a “speed bump” in front of students before they even get a chance to accumulate massive debt for a worthless degree…

    ..Back in the 70’s there was a program called “Scared-Straight”. The idea was to dissuade juveniles (who were starting to commit petty crimes) from escalating into more serious criminal offenses. They would take these juveniles to visit prisons where hardened inmates would very loudly/in-their-face frighten, harangue, and berate them, warning that if they continue on their current path, they’ll end up in prison as well. The haranguing was so incredibly over the top that the juveniles would be far more frighted of ending up in prison, thus they were “scared straight”.

    I think a similar program would help for prospective college students, only instead of taking them to prisons, they instead take them to a coffee shop staffed with baristas with worthless degrees and $100K+ in student loan debt. The baristas can warn the prospective college students of the horrible decision they’re about to make.

    …obviously I’m joking (sort of), but something definitely has to be done. Unless prospective students start making better decisions early on, there’s no hope for solving the crisis.

      1. …yeah, I kinda figured it probably didn’t help..

        …but you’ve got to admit…it would be funny watching a group of prospective students getting harangued by a barista at Starbucks, and then refuse them the code to the bathroom door !

    1. What happens when a teenager applies for a loan to buy a house or car they can’t afford? They get denied. If teenagers want to get financial aid for college there are multiple avenues to get funding for it and alternative/cheaper educational options. The loan companies shouldn’t be allowed to give out loans without any consequences (like potential default)

      1. Yes because education and improving ones circumstances and prospective future is the same as buying a car. Love the logic.

        1. Super productive comment to the discussion. I would honestly love to hear ideas about how you would fix this situation besides complaining about other people’s logic.

          If we maintain the status quo of government backed non-default student loans, would you be open to making public education free (or nearly free), which may require increasing taxes to fund it? Or charging zero interest on government backed loans?

          Currently there is no incentive to for public colleges to lower tuition and make it more affordable since the current loan system forces those disadvantaged students you care about so much to be preyed on by those loan companies.

  12. You can default and declare bankruptcy on a car loan, home loan, credit card debt, etc. (yay capitalism) but for some reason you can’t with student loans… Why is that? Why are there strict regulations and procedures to prevent bad lending practices in everything except student loans, which target the population that most need help to further themselves into productive members of our society?

    My biggest issue is that it’s a temporary band-aid that doesn’t change the existing system. I hope the people who are crying “SOCIALISM!!” actually care about fixing the issue by voting to reform student loan debt to be defaultable, instead of being happy with the status quo (regardless of your political affiliation).

    1. Regarding not being able to bankrupt out of student loan debt…

      …back in the 70’s there was large numbers of wealthy people getting professional degrees (medical, law, MBA, etc) who were bankrupting out of their student loans immediately after graduation. Some of these were very high profile, and I even recall a major television news program (60-minutes ?) doing a piece on it…

      …anyhow, the public was outraged and the rest is history…. congress outlawed discharging student debt as part of a bankruptcy.

      1. Interesting, thanks for sharing. It sounds like the bankruptcy law for student loans could be better structured to disincentivize this situation.

        For example, if you declare bankruptcy then you would need to pay a certain % of your income for a certain time period once you start filing taxes or once you make a certain income level. And your credit rating/score would be affected for certain amount of years. Wealthy people who try to take these loans would need to tie assets to it as collateral (similar to filling out FASFA and declaring assets) or flagged for IRS to pay more taxes in future when their income rises.

        This would at least have some level of punishment on students who try to take advantage of the situation irresponsibly.

  13. Helping people in need is good policy. Even better policy is to make education and healthcare affordable. A well educated and healthy nation can compete successfully with other nations. A sick and uneducated nation is bound to fail and implode.

    1. All of the people who are in trouble with student loans are in theory “well-educated”. I don’t think education makes any difference…

      Common sense makes all the difference. One piece of common sense is you pay back your loans or better yet, don’t take non-dischargeable loans you mathematically can’t pay back.

      Unhealthy is borrowing and welching. Student loan reform is long overdue.

  14. The happiest countries are the ones that find a workable balance between capitalism and socialism. It’s more about powerful vs. powerless than left vs. right.

    Student loan forgiveness is a good first step, but as you suggested, it’s just a bandage on top of a larger structural issue.

    There must be a reason why students in Europe and Quebec get quality low/no-cost tuition, while the US literally debt traps students for life. That reason needs to be fixed, but with all the corporatized fascists (not hyperbole!) ascending to power, I don’t see that happening soon.

  15. Love most of your content but this the rare turd you produce. It’s not abou giving “someone a break”, “helping one else out”, or “selfishness”. Everyone who takes out student loans for pointless degrees is bad at math. Same intelligence level and logic behind every home-boner. No one was forced to take on these loans. There are many ways not to go into debt to pay for your education. Friends joined ROTC; one worked a minimum wage job, took lighten class load, and took 5.5 years; and I ran the numbers, did low cost community college for 2 years, aggressively applied to scholarships, and transferred into my engineering school to keep costs down after getting the prerequisites completed. These all required sacrifices to avoid loans.

    I personally feel this is wrong and evil. Student loan forgiveness is asking others to to pay the consequences for your poor decisions. Only in politics would people disagree on this.

    Student loans themselves are garbage. Designed to be affordable so it incentivize terrible behaviors by borrowers, lenders, and universities. They should be dischargeable but have interest rates set similar to the market risk=25% sounds right.

  16. What do you think about the argument that passing some level of loan forgiveness without fixing the underling perverse incentive scheme merely adds more incentive to increase college costs since the government has shown that it’s willing to have broad forgiveness programs (rather than the narrow public service type programs that currently exist)?

  17. Honestly, Wanderer, I’m baffled at how such a great blog could cultivate such stupid readership.

    Is this a “socialist giveaway”? Is it “an attempt to buy votes”? Hey, for those of you complaining that it is, you ready for an actual intelligent take? Sit down for this, because this is going to be pretty far above your paygrade, so to speak, but hearing this will be good for you. Okay, here we go:

    It doesn’t matter if it’s “socialist” or not, even disregarding the fact that you probably don’t even know what “socialism” or “capitalism” is. And also, yes, the way things should work, ideally, is we vote for politicians who do good things (like student loan forgiveness) and against politicians who do bad things (like block student loan forgiveness). Yes, I know that’s not always what happens, but that’s what’s supposed to happen.

    Also, the whole “Heh, you got your loans. Now pay them off like I did!” argument? Can we just not pretend that isn’t the most piss-baby argument out there? I still have a few years to go on my mortgage. If mortgage relief were announced the day after I paid mine off, sure I’d be pretty disappointed that I didn’t get to benefit from it. But I wouldn’t use that as an excuse to oppose relief for others.

    Because I’m not a toddler.

    And Wanderer, you don’t really follow American politics that much if thought the Republicans’ response to this wouldn’t be “borderline psychotic”. The entire party has, over the past few years, had collective mental breakdowns over Mr. Potato Head, non-sexy M&Ms, football players kneeling, black women existing in movies and TV, LGBT existing period, and American democracy as a concept. Oh, and now openly in the past couple weeks, Jews. This is actually tame for them. At least they’re reacting to a policy and not a reboot of a children’s TV show or something…. again.

    Or Jews…. again.

    ARB–Angry Retail Banker

    1. So, I and everyone else just get to get fucked? That’s the response then? You did the right thing, go fuck yourself? I mean if Brandon wants this to be “fair” everyone gets $10k college or not.

      1. “So, I and everyone else just get to get fucked? That’s the response then? You did the right thing, go fuck yourself? I mean if Brandon wants this to be “fair” everyone gets $10k college or not.”

        See what I said before about this being a piss-baby argument.

        Also, “FAIR”!? Get outta here with that woke s***.

    2. I am still waiting for an intellectual take. Hurling insults, name-calling and hyper-partisan exaggeration does not reveal intellectual insight, quite the opposite. Please proceed to prove my point.

  18. But there are thousands of people who get trapped in that same system every year through no fault of their own, and the consequences of being trapped in that system mean they are going to be stuck in a cycle of debt for most of their adult lives unless they get help.

    No fault of their own?? Of course it’s their fault!! No one forced these folks to take out student loans to begin with. No one forced them to go to private school to get worthless degrees. Should we start forgiving credit card debt because people get in over their heads and use their credit cards unwisely knowing they cannot pay the monthly bills? When are we gonna hold people accountable for their actions? It all starts with the individual.

    1. “But there are thousands of people who get trapped in that same system every year through no fault of their own, and the consequences of being trapped in that system mean they are going to be stuck in a cycle of debt for most of their adult lives unless they get help.

      No fault of their own?? Of course it’s their fault!! No one forced these folks to take out student loans to begin with.”

      This was like watching a football player on his own 1 yard line make an awesome play, break past the defensive line, run across the entire field, and then trip over his own feet and die just inches from the endzone. Or, I dunno, stop and run the other way or something. Dramatic dive for that safety.

      “Holding people accountable for their actions” is great government policy when we’re talking about criminals and corrupt people in power, not young and not-so-young people in financial distress and disadvantage due to the systemic failures of the higher education and financial systems. You even said it yourself that thousands of people get caught in it through no fault of their own. That’s usually a fairly good indication that it’s not really the fault of the individual. The 17 or 18 year old, mind you, who we don’t even believe to be mature enough to drink a beer (the former is legally is a child!!). That individual.

      Hey, the credit card debt people? We DO do something to help those people. It’s called “bankruptcy”. Also, I’m kinda thinking that credit card debt might not be the example you wanna point to considering that so much of credit card debt is necessities and medical spending.

      And considering the broader economic advantages we all reap when consumers have more money in their pockets and more cash to spend, I’m gonna lean towards maximizing that then “personal responsibility”, and I must emphasize the quotation marks around those two words.

      1. Fair point on the credit card bankruptcy law. I forgot about that…BUT I disagree with being able to forgive that in bankruptcy. As for your comment on ‘broader economic advantages we all reap’…we all might as well just max our credit cards and file for bankruptcy since we would have broader economic advantages for a bit…

        I stand by my comment that it’s the fault of the individual. Maybe I’m naive but at that age (17-18), it was fairly common sense for me to judge for myself how much money I was willing to take out for student loans and what my potential salary range would be once I graduated. I was able to figure all this out w/o the internet. Also at that age, fairly common sense to know not to charge something on a credit card that I could not afford to pay off every month. No, I didn’t have money growing up, my family was not rich by any means, it was just common sense…something that is sorely lacking in today’s society.

        1. You’re conflating credit card forgiveness and bankruptcy. Declaring bankruptcy cuts you off from access credit for a period of time, as well as has other debilitating effects (such as inability to rent a place to live or gain security clearance for certain types of jobs). A nation of bankrupt people is not the same as addressing a broken system of unsustainable debt.

          As for the second thing, this is a debate over individual and systemic issues. I can only counter what you said with, well, YOUR own words in which you convincingly and correctly argued that this is a systemic problem:

          “But there are thousands of people who get trapped in that same system every year through no fault of their own, and the consequences of being trapped in that system mean they are going to be stuck in a cycle of debt for most of their adult lives unless they get help.”

          You can say that each individual should do the best they can and the right thing when possible and I’d agree, but you don’t get a student loan crisis that necessitates federal intervention off individual failings. We have systemic problems that need to be confronted with systemic solutions, not by folding our arms and complaining that the problem shouldn’t exist.

          And despite how you present yourself as “not rich”, I’m willing to bet you were “not poor” either. Credit card debt isn’t just people going on fun shopping sprees. MASSIVE amounts of credit card debt involves necessities, medical bills, so on and so forth. People are living paycheck to paycheck, unable to afford even small emergencies. The myth that poor people are poor because they’re too stupid to balance a checkbook is just that: a myth. Rich and upper middle class people are often far dumber with their money, but financial mistakes just aren’t nearly as consequential when you have money.

          “……it was just common sense…something that is sorely lacking in today’s society.”

          Ugh, I hate this argument. It’s such a turn-your-brain-off argument. “Common sense” is not an argument. You can talk about common sense if we’re referring to an individual or a small group, but not something like this.

  19. I’m ambivalent about the $10,000 forgiveness. It’s Socialist BS, but it’ll help people. $10,000 isn’t a huge amount anyway.
    However, $42,000 forgiveness? What the heck man? Why did I even pay for college? I should have borrowed and pay the minimum.

    1. $42k was the result of public interest loan forgiveness, which requires 10 years in public interest sectors while making on-time payments. After 10 years of what amounts to community service for a pittance of a wage, I say give it to ’em. Goodness knows there’s not a whole lot other than their overly-generous hearts incentivizing people to stay in public interest. As for me, I went private sector so I could get a nice paycheck for my work, which in turn lets me pay my share of taxes to the government, so it can do things like fund government and public interest pittance paychecks.

  20. Brandon trying to bribe a few privileged voters who got themselves into massive debt with everyone else’s tax money through executive action without approval by the people ( Congress).
    Worst thing is a Canadian wearing rose tinted glasses taking the CNN Dem propaganda and writing this article .
    Students in Canada also face massive tuition and debt but Canadian universities are massively subsidized by the government and offer fewer programs to more privileged people compared to US private and public universities.

  21. Kristi, can you please block and delete the ARB spammer? He’s probably a bot from Biden’s campaign
    BTW, do you guys follow that Twitter account that accounts for how many billions of our money Biden has given away today? It’s funny if it wasn’t sad!

    1. Beep-boop, not a bot. I just don’t find the people screeching about loan forgiveness to be either doing so in good faith or….particularly smart.

    1. I’m almost done paying off my mortgage. If there’s a mortgage forgiveness plan that happens after I’m done, I’m not going to be angry that others are getting a benefit.

    2. I too have paid off my home mortgage. I made major sacrifices to pay it off in four years. I have been living free and clear for a few years now.

      If everyone’s mortgage got paid off, I would cheer. If everyone renting got a free house, I would cheer.

    3. As the person who was a few days short of paying off the last $15k of my 6-figure student loan debt when Biden froze student loan payments due to COVID, I am *ecstatic* to hear that others will be getting student loan debt relief.

      And no, I don’t qualify, so that last $15k is going to come out of my bank in December. I still count myself blessed that I haven’t run into a major crisis that would derail my current way of life and my great run towards FI.

  22. Wanderer,

    I didn’t expect your perspective to be centered on the borrower without mentioning the lender who loses the money he or she loaned. Can you speak to the saver who lent money to students?

    Are these student debt bonds held by pension plans or in bond mutual funds? Who invested this money to lend to students and what happens to them? Does the government guarantee the securities like the government guaranteed mortgage back securities that resulted in the Great Recession in 2008.

    When I lend money I expect the borrower will pay it back, but now the government is changing the rules, changing the contract that the lender and borrower signed. Will this be the only kind of contract that the government will break? That sounds like a bad precedent.

    It I were to lend money to a student borrower now I would want a higher interest rate or maybe I would just avoid those securities. Changing the rules after the game as started has long term consequences, and probably not in favor of needy students.

    1. “I didn’t expect your perspective to be centered on the borrower without mentioning the lender who loses the money he or she loaned. Can you speak to the saver who lent money to students?”

      The ones who made these loans are the banks and the government. They’re fine and not really a priority here. And as for “the saver who lent money to students”, none of you “lent money” to students. Yes, I’m aware of taxes. No, that’s not how they work. You are not paying extra money or sacrificing public services to make student debt forgiveness a thing. Let’s all stop pretending that the taxpayers are being victimized here.

    2. I haven’t tracked the average rates, but when I took out my Department of Ed loans in ’08 – ’14, my interest rates ran 5.6% – 7.9%. I had an 800 credit score and a full-time job making fair money. When I applied for a home loan for the same amount that my student loans ended up being during the same time period, my interest rate was around 3.75%. The overnight rate during much of this period was 0%.

      So how is this unfair to the US Department of Education (aka the student loan lenders)?

  23. Didn’t go to college, and I watch over a third of my paycheck disappear to no apparent benefit of me. Bugger off with your “wants and needs”.

  24. Great article to stir the pot guys! Of course, the timing of this IS political and just an FYI Biden always campaigned on only $10,000 relief. Sanders is the one who campaigned for 100% relief. Will it fix the brokenness of the system? No, but it’s a start. The new payment plan being offered is even more significant. I believe it caps payments at 5% of your income and the government will pay any remaining interest that’s not covered, which is huge.

    I graduated vet school in 2009 with $155,000. Took a low paying internship, so I could be a better equine (horse) vet. Except it was 2010 and the Great Recession hit the veterinary industry really hard, so I couldn’t find a job for 6 months. When I did, it was only part-time. Interest accruing all the while because my payments couldn’t cover it all. Slowly acquired 2 more part-time jobs. Then I was working 13/14 days for 18 months. Even with the 3 jobs, my income was only $60,000. Finally, got burnt out and moved to highest paying gig (which was small animal not equine) and went full time dropping out of the career which I had done extra training (and loved).

    Now that I’m 13 years out, I still have $127,000 in loans since most of my payments went to interest. So yeah, I’m gonna take that 10k and not feel like a socialist. To those who say you signed the dotted line you agreed to pay it back, blah, blah, blah. I also was told I was in a recession proof career and there was a vet shortage. I fully intended on paying it back, but holy hell it’s hard. And all the while I’ve never purchased a house, had a fancy car, or bought designer anything.

    To all the pet owners out there, treat your vet kindly. Because now there really IS a vet shortage. Stories like mine where the debt has piled up and the pandemic driven demand for puppies has caused a back log in ERs and GPs. Client complaints and insurmountable debt make it a hard profession to promote or stay in. Vets are unaliving themselves at an alarming rate.

    Also, state vet schools like mine used to be subsidized by the federal government back in the day and now no longer get those subsidies. I just call this retribution.

    People don’t realize the careers that some people have chosen and are getting shit pay for and can’t repay the loans on are careers that are really needed in the community. Get off the high horse already.

  25. Thanks ARB for the heavy lifting. Great blog, though the comments have had a heavy helping of libertarian garbage for a while now. So glad these commenters have made it to FI all by themselves, with no help from our prosperous and learned society. There: I said it, ‘society’. As in, what Thatcher didn’t believe existed. It would be nice for these libertarians to make a decent argument in their comments. Instead, we get third grade insults and personal attacks. Guess what libertarians? There *is* an alternative. Your ideas don’t work in real life because people in real life don’t follow your made up theories of how they should act.

  26. Heavy commies bot activity here. Wow.
    Nobody talking about the only thing that matters. The US debt and its certain rate cutting looming.

  27. Hi Wanderer,
    Not going to bash the whole thing, I had loans and eventually did get some forgiveness on interest portion that helped a little.

    Regarding this benefiting the rich: yes it absolutely CAN. If I am set up under my own corporation I can pay myself how much or how little I want and control how that is paid to best benefit me from taxation, or in this case set it up so that I am at the optimum income to receive full forgiveness of my loans.

    The other thing is the comparison in tuition in Canada vs USA. Canadian universities receive ALOT of funding different levels of government. This is why tuition is at different levels for students from outside Canada (hence what the full price would be). I do not know if the foreign student rate compares to USA school rates however.


  28. So let me get this straight? You want the waitress making $12 per hour (that never got to go to college because she or her parents could not afford it) to pay for the guy that just became a lawyer or a doctor?
    So if I’m a dumb ass who takes a 4 year programme in gender studies then can’t afford to pay back my loan cause we’ll surprise nobody wants to hire me? Then the rest of the country should pay? Sure, makes perfect sense!
    The bill for loan forgiveness will just get redistributed as inflation which will then hurt everyone but mostly the poorest people in society.
    Also it’s just a cheap shot to buy liberal votes and probably will never go into effect.

  29. Hi,
    It’s a market like any other.
    The problem is not funding, but supply and demand.
    If you want prices to drop, increase supply (eg: more establishments) or lower demand (eg: increase access conditions, criteria to choose from)

  30. Biggest problem is that Biden decided on this policy by executive order. Under the US constitution a bill should have been voted on in congress. That’s how our republic works. This is why it will never really happen
    The Democratic majority congress could have passed such a bill but Sen Schumer refused to hold a vote in the senate.
    So the whole thing was a cynical election ploy designed to get votes for the Democrats.

  31. In Canada, our government is prepared to give every child at least $7,500 towards their college/university costs. I guess this cash comes from the taxes we pay, and I don’t give a toss because the bigger picture is a better society, where we help our young people get on their feet quicker, enabling them to contribute to the economy faster so that the next generation can receive the same benefit.

    Socialist commy Canada is a pretty good place to live.

  32. 1. I think you meant people are trapped in a “vise”, not “vice”, though that may have been a Freudian slip on your part lol.
    2. Why not make student debt repayment on some sort of community/state/national service? The GI Bill for US military has existed since 1944, and deals with this specifically. Making voluntary student debt repayment contingent on some sort of value – be it military service, working in health care, certain approved charitable organizations, etc, might make the concept more palatable to ppl currently opposed to this.

  33. Hmmm, I really got a little tired of reading the political angles about student debt forgiveness, etc.

    Instead of wholesale student debt forgiveness, increase grants for students especially low-income eligible from such families in their first few years of university.

    And reduce the student debt forgiveness for students who come from families with some more money to pay off.

    I’m sorry, as a Canadian myself and several siblings, did apply for and got some government university student grants (OSAP) because my father was low-income as a restaurant cook. Myself and siblings did have summer jobs to cover some of our own tuitition, etc. My mother was housewife (education up to gr. 10 in China), raising 6 kids. So that was her “unpaid” job. No, none of us had money to take reading wk. or post-graduation trip to beach holiday or travelling in Europe or Asia. None of us travelled until we….earned our own money after university. We never blew money and….we never dared ask parents. It was enough to see how hard my father was working and mother stressed out.

  34. Well that’s a relief! The government can transfer $400 billion from all who pay taxes to the most educated folks and no one suffers!? It sounds too good to be true.

    But wait the government is already spending more than they collect so additional spending is paid for by creating with new money. Hence our 8.2% inflation. At this rate, as a retiree, I need to figure out how to double my income every 9 years to maintain my living standard.

    I took $50,000 out of my IRA this year for expenses, so I need to take $54,100 next year and $58,500 the next. Unfortunately my portfolio isn’t even going up so I will be taking out less next year.

    I have the deepest sympathy for students roped into such a disastrous situation. I also fear for everyone coping with the increasing cost of living. A growing, dynamic economy and sensible government policy is the only way out.

  35. Wow, some of these comments are crazy. I am pro-debt forgiveness for individuals and small business, and I’m surprised how many conservatives and even liberals are against this, ESPECIALLY considering the top brackets of student debt holders in this country are teachers and nurses, who as we all know and generally agree, do not get paid enough for what they do, and we have a shortage of both professions

        1. You’re right to refuse – my debt has nothing to do with you. Similarly, the debt that people voluntarily take on doesn’t constitute an obligation on the part of taxpayers. And people are not “crazy” for not wanting to spend public funds the same way you don’t want to spend your own money.

          1. Aren’t we all voting on how to spend public money, though? I’m just saying that my vote is for it. I’d rather my tax dollars and corporate profits be used to boost an equitable base for everyone, and not leave people in financial pits. There’s a lot of different reasons people get into debt, and yes, some are more irresponsible than others. I think student loans are one of the more predatory debt vehicles.

            And second, I apologize, “crazy” is a strong word, and I should be more understanding. But comparing minor federal debt forgiveness for education to communism is a bit extreme imo, and that’s what I’m seeing a lot of here.

            1. Yes, and I respect your vote. I surmise, though, that most people would not consider paying off loans except for their family and the closest of friends. Yet, when it comes to public money people are not only OK, but even passionate, to do that for complete strangers. Personally I find that strange, but nonetheless I respect others for having this opinion.

              I agree with you that calling this “communism” is extreme, and that some folks do go too far. On the other hand, this program costs $400B. To put it into context, it’s 10% of our annual federal revenue, so I wouldn’t consider that minor. I would prefer that money invested in other things that could yield longer term gains for everyone.

  36. They do see us as cash cows so of course they are against student debt relief. They want to keep us in debt so they can keep getting rich. I paid off my loans, and I would be glad if it was forgiven for others. It would make me happy to see others were able to get out of this debt trap created by greed.

  37. Absolutely not fair. I make 126k a year and I don’t have access to the forgiveness but my colleague that don’t do shit and didn’t get a raise and makes 124k has.
    This is the United States of Disgrace. This country is going downhill ! Hope GOP gets back in charge soon! Ye is right

    1. You make 126k a year, so you are a top 10% earner in this country, and you have your student debt paid off… And now you are so butthurt about your colleague that you’re endorsing Kanye, who’s hate speech is giving rise to rampant antisemitism. What the fuck are you so afraid of, sitting on your privilege pedestal? Stop pearl clutching a meer 10k like it would make all the difference in the world to you, and stop siding with literal Nazi hate speech. I’m scared for our country too, but it sure isn’t because some people are getting some college education debt forgiveness

  38. Paying all this for college is absurd. I can’t wait for the day its ROI will be negative (it is in many cases already). People have this stu*pid illusion of Education! Big piece of crap!!!
    You don’t need college to get educated!

  39. Government guaranteed loans have encouraged too many who shouldn’t be going to college attend, and get themselves in financial trouble. Someone going to a grade school level remedial math course should NOT be attending college. While some countries offer free college, they offer it to qualified, quality students, not low IQ AA candidates.

  40. The US national debt is about $31 trillion. In a FIRE household, there are a number of causes to support or things to buy, but the first question is ‘can we afford this?’ I’m pissed off that question gets skipped by our government and our grandkids’ country will be screwed by the huge debt. This is driven by bs like this $400 billion as part of a vote-grab. You took the loan, you freaking pay it.

    1. Bingo! Exactly !!!!
      And with the FED interest rates going up like hell, the national debt will double every x years (use the rule of 72 here). It won’t be sustainable in a couple of years and the US will be history. China is rising and by 2050 they will own the planet.
      Lucky you Kristi, hope you kept your chinese citzenship ! it will be your time!

  41. Whatever our views on student loan forgiveness, the main issue is the ridiculous cost of an education in North America. These costs have dramatically outstripped inflation and incomes over the last 40 years and the result is an unsustainable debt problem.

  42. Facts of Life…
    1. Big fish eats little fish
    2. Little fish builds America
    3. Super greedy big fish and super dumb little fish will eventually destroy themselves and get eliminated from the game.

    Game plan for the rest of us…
    1. Big fish – don’t give too much and don’t give too little, give it just right
    2. Small fish – have a passion for your job and develop a hunger for continuous learnings that enable the transformation to big fish

    1. Yeah. This is so true
      “have a passion for your job and develop a hunger for continuous learnings that enable the transformation to big fish”…since little kids we’re conditioned to that…go to good schools, get good grades, graduate and find a good job that will make the company’s owners rich…we’re never taught to be the owners (or stockholders)

  43. Trump !!! Please come back and make America great again! Socialists are destroying it and recklessly spending our taxpayer money in useless crap!!!

  44. “The solution to breaking this feedback loop is to create a way for students in this situation to discharge their debt either through bankruptcy or an automatic loan forgiveness program….. If the lender lost tens of thousands of dollars … on their debt, they would become a lot more careful ….”

    You seem to imply that loan forgiveness causes the lender to lose $$. Correct me if I’m wrong, but I believe the taxpayers are paying the $10K to the lenders. Since, according to the CBO, this program will cost taxpayers ~$400B.

    Assuming that’s correct, the forgiveness program actually prevents lenders from suffering losses on bad loans and hence emboldens them to continue preying on students pursuing useless degrees. This would be directly contrary to what you claimed in the article.

    The amount of student debt currently stands at $1.6T. If this has become a too-big-to-fail situation and threatens to crash the system, I would understand the need for forgiveness. But the administration hasn’t explained that this is the case.

  45. Thank you Wanderer for trying to highlight the complexities of the student loan problem in the US. As an American who was saddled with 6 figures of student loan debt (and who paid it off over a very painful 10 years) I’m strangely ambivalent on the whole student loan forgiveness program. On the one hand, I’m happy for those who will truly benefit from it. I remember how awful and terrifying it was to look at that debt when I was barely making minimum wage after school. And I also know what a scam it is, you literally walk into the financial office of your school, sign a piece of paper and walk out with a check. Absolutely ridiculous. BUT as someone who learned over those 10 years very painful, albeit useful financial lessons from seeing my hard earned money go towards decisions I made in my 20’s, and the satisfaction I had watching the loan balances go down each month, further motivating me to throw more money at them…I don’t know if I would have learned how to better manage my money if I wasn’t paying off all those student loans for 10 years. I don’t think I would have found the FIRE community and learned how to manage my own finances to the point I’m now COAST Fire and enjoying the life I’ve designed for myself. Sometimes the painful life lessons are required.

  46. In the shortest possible time and at favorable interest rates you can get the amount of money you need. Any resident of our country can get a loan. Clients receive microcredits on favorable and simple terms without any hidden fees and additional payments. So, even before getting a microloan you will always know exactly how much money you will need to repay it.

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