President Biden on Wednesday announced a sweeping student debt forgiveness program that cancels up to $20,000 in undergraduate student loan debt for millions of Americans. Individuals with incomes below $125,000 (or $250,000 for married couples) will receive $10,000 in debt relief, and twice as much if they received Pell grants to attend college.
Jesse Van Tol, President and CEO of the National Community Reinvestment Coalition, made the following statement:
“This is welcome and meaningful relief for former students drowning in education debt. The lifting of this burden will enable more people to invest in their futures, buy homes, support their families and accumulate wealth to pass on to the next generation.
“But let’s be honest, too. This is great for those who benefit immediately, but it doesn’t solve the underlying problem of inadequate public support and high costs for education. One-time relief for past borrowers does nothing to make public education more accessible to lower-income students. It doesn’t make upward mobility more plausible for current and future students who face the same overwhelming expenses for education. And it doesn’t help anyone who made a difficult decision to avoid taking on debt.
“Public universities should be a pathway to social and economic mobility – that’s a core premise of public education. But federal and state policies that have cut higher ed funding and pushed more debt onto students reflect an alternative vision of higher education limited to those who can afford it. A just economy would eliminate the emotional and financial burden of debt for education at all levels, from preschool through graduate, trade and professional school. Relief for current debt is a serious move to help a lot of people now. But it doesn’t fix the higher education system that demanded that debt in the first place.
“Some of the forward-looking solutions we need can be delivered through new Department of Education regulations – and we look forward to the Biden administration making good on its recently announced intention to issue rules to reduce repayment costs for future students. The other tools required to truly fix what is broken in higher education finance will come down to legislative courage: Government should be shouldering more of the cost of a quality education, so that individual Americans striving for brighter futures don’t find themselves in need of this kind of relief again a few years down the road.”