EDITORIAL: Federal student loan forgiveness good start, more must be done
As debates emerges over student debt forgiveness, larger problems of economic insecurity come into focus
On August 24, President Joseph R. Biden Jr. announced a federal student loan forgiveness program. The program would cancel $10,000 of debt for individuals making under $125,000. For individuals who meet these income requirements and received Pell grants in college, $20,000 will be canceled.
The student debt crisis has only been getting worse and it needs urgent attention. While the move — just more than two months before the crucial midterm elections — certainly reeks of political maneuvering meant to galvanize Biden's base, it is still a good, decent program that begins to address the colossal problem of student debt.
The program will fully cancel student debt for nearly 20 million Americans, an astonishing number that we should not overlook. But the same fundamental problems remain: skyrocketing costs, insane interest rates and a financial system that favors the powerful and well-connected.
More clearly needs to be done and this program should be viewed as a first step, not the final destination. To adequately address the issue, we need legislation that is sustainable and can make an actual impact.
One legislative action that must be taken to make college more accessible to everyone is strengthening Pell. Because Pell grants are given to students who qualify and they are for economically disadvantaged students, they do not have to be repaid.
Pell is a great program that was designed to make higher education more accessible — yet, the program has stopped being entirely effective: In 1975, Pell grants covered nearly 80 percent of tuition, fees, room and board at public four-year universities. In the 2016-2017 academic year? Pell covered just 29 percent.
Pell covering less of the costs means low-income students need to take out more loans. As Pell has stopped covering college costs, college has become insanely more expensive. In the 1970-1971 academic year, one year at a public university (like Rutgers) would have, on average, cost $394, which would translate to $2,760 in today's economy. The average cost, though, for a year at a public university in 2020-2021 was $10,560.
Predatory student loans also have become common. Navient, a large student loan servicing company, just settled a $1.85 billion settlement with the U.S. government for engaging in unfair practices by giving loans to students who were unlikely to be able to pay them back.
While the settlement with Navient is a good start, the culture of predatory loans persists, and there needs to be stricter enforcement of regulations to protect students.
These are the reasons that have brought us to this moment of crisis with student debt. Just canceling debt is not enough. To prevent the incredible accumulation of debt we are witnessing, we need actual legislation that addresses these fundamental issues.
Part of the financial issues is related to individual universities, and how they decide to spend money. As students at Rutgers University, we need to demand transparency about tuition hikes. We need to demand that money is distributed fairly, and we need to demand that our university works on our behalf.
In an infuriating report from the summer, it came to light that the Rutgers Athletics Department spent $450,000 on DoorDash. Although Rutgers has argued those costs were incurred as a result of the pandemic, it remains an incredibly large amount that did not have much oversight.
The federal government can do all they want to address debt, but if universities continue to allow this type of spending — at the cost of part-time lecturers, critical infrastructure and better mental health resources for students — the crisis will only worsen. The issue of student debt fits into a larger conversation about economic insecurity in the country. People, rightfully, feel left out if they decided not to pursue college or if they decided to open their own business or if they saved for college or, even more, if they have medical debt. These are all real sources of economic uncertainty and anxiety. And they all require urgent addressing.
Through those anxieties and feelings of being left out, the universality of economic suffering becomes obvious. For too long, this country has prioritized those in positions of power and wealth, at the expense of everyone else. We should be upset at the economic structures and demand a better, fairer system for everyone.
The Daily Targum's editorials represent the views of the majority of the 154th editorial board. Columns, cartoons and letters do not necessarily reflect the views of the Targum Publishing Company or its staff.