this post was submitted on 22 May 2024
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The Biden administration is canceling student loans for another 160,000 borrowers through a combination of existing programs.

The Education Department announced the latest round of cancellation on Wednesday, saying it will erase $7.7 billion in federal student loans. With the latest action, the administration said it has canceled $167 billion in student debt for nearly 5 million Americans through several programs.

The latest relief will go to borrowers in three categories who hit certain milestones that make them eligible for cancellation. It will go to 54,000 borrowers who are enrolled in Biden’s new income-driven repayment plan, along with 39,000 enrolled in earlier income-driven plans, and about 67,000 who are eligible through the Public Service Loan Forgiveness program.

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[–] Fedizen 98 points 7 months ago (3 children)

Education should be free. This is at least a better situation.

[–] jj4211 14 points 7 months ago (2 children)

Without some sort of long term strategy, it may not be.

I've always said this would be good if also paired with some moves to improve things longer term, because random infusions of lots of free money without any checks on the university side has already worked to make the education more outrageously expensive. Continuing the strategy without any sort of price management will make things work.

Same could be said of healthcare, if as much money as they ask for is provided to the pharmas and hospitals, they will ask for more and more. Relief must be paired with some sort of plan to mitigate that.

[–] [email protected] 7 points 7 months ago (2 children)

You can treat symptoms and then address longer term problems when able. It's not like it would be better for these people just to keep paying because the current divided Congress won't address the core problem.

[–] jj4211 3 points 7 months ago

I hope so, but I'm pessimistic that even with full control that they have the political will to make reasonable reforms. Hoping I get to see what they do with full control for two years at least.

[–] [email protected] 3 points 7 months ago (1 children)

As long as you address the root problem in the window of time before things get worse from this cash infusion. And to be honest, I don't have much confidence in that happening.

[–] [email protected] 2 points 7 months ago (1 children)

I don't think the US university system is going to rework their fees because 160,000 people got public-service or low-income related forgiveness. It's not even giving money directly to schools or financial institutions. The worst case is people who plan to either be poor or do public service may be less cost conscious when applying to schools, but the PSLF and income-based payment programs already existed and more importantly 18 year olds are just completely clueless about what taking out a $100,000 loan means. People fetishize economics like it's a perfect mathematical system where every dollar spent will yield results in some other part of the system while just outright ignoring all the complete irrationality that exists in consumer decisions.

[–] jj4211 2 points 7 months ago (1 children)

I think an individual jolt of this magnitude will not necessarily move the needle, but I've heard commentary about this just being a regular presidential thing to do going forward, which would be a pretty inadequate and unpredictable way (each time binging on happenstance of election, assuming that at least one of them even wants to do the "tradition"). Might be unfair for me to think overmuch on those suggestions, but they always stick in my head in these conversations. Still find it odd that the executive branch should be able to do this sort of thing unilaterally.

[–] [email protected] 1 points 7 months ago (1 children)

These were all either existing programs or a new program that forgives loans that already weren't being repaid (via existing IBR rules). This is "unpredictable" only insofar as the previous president refused to let the programs work.

Still find it odd that the executive branch should be able to do this sort of thing unilaterally.

He isn't. He does have that ability (because Congress specifically gave it to the Executive in the Higher Education Act), but these are existing programs directed by Congress. The new group is just Biden automatically enrolling people who qualify in the old program.

Worry about loan forgiveness to businesses and rich people rather than to poor people and public servants. There's corn and fuel subsidies costing way more than this that have perverted the economy and actively destroy the environment. People get really worried about the economic effects of poor people getting stuff like that's coming directly out of their wallet when there's so much larger and more direct issues that just get assumed as normal.

[–] jj4211 0 points 7 months ago (1 children)

This is “unpredictable” only insofar as the previous president refused to let the programs work.

The end result was a promised program that didn't work as intended and was unreliable. The details are a little less important than the results. However, I'm actually referring broadly to some folks that I saw saying that it should be some sort of presidential 'ritual' of forgiving debt, rather than being confined to select programs.

Worry about loan forgiveness to businesses and rich people rather than to poor people and public servants.

Note that I'm less concerned about the loan forgiveness, but instead worry about the "blank check" effect and future affordability and whether or not a student gets stuck with debt assuming they will get forgiven and then get screwed because a future administration refrains from doing so or interferes with 'forgiveness'. I'd rather circumstances result in no significant debt at all, that government's willingness to contribute happens up front and universities are somewhat held accountable for their costs to keep that affordable. We can also worry about the crap done for businesses and rich people, but the current situation kind of sucks for planning if you are poor, having to go into massive debt hoping maybe you'll get in on some forgiveness down the line.

[–] [email protected] -1 points 7 months ago

The end result was a promised program that didn’t work as intended and was unreliable. The details are a little less important than the results. However, I’m actually referring broadly to some folks that I saw saying that it should be some sort of presidential ‘ritual’ of forgiving debt, rather than being confined to select programs.

Then maybe you should have found a topic about that or referred to it specifically rather than just latching on to whatever debt-forgiveness news came up to air your grievances. It's kind of obvious you're not really concerned with whether a program is "unreliable" and just don't like debt forgiveness, because all of these things exist with any program ever. The executive can sabotage it? That's fucking everything. These are congressionally-passed laws establishing long running programs, there's no "righter" way that means a hostile executive can't sabotage it.

[–] meliaesc 1 points 7 months ago (1 children)

But it is paired with other measures? The original full package would not charge interest for anyone making payments, for example.

[–] jj4211 1 points 7 months ago

I was thinking more on the university side, some sort of strings attached to have universities a bit more mindful on expense. Waving interest is again a good thing for the borrowers, but it's still a relatively blank check for the universities.

[–] Rickard_Nutella 7 points 7 months ago (1 children)

This is why I am seriously considering studying overseas.

[–] [email protected] 4 points 7 months ago* (last edited 7 months ago) (1 children)

A few Australian universities attend college fairs in the USA, because even after you include the price of the flights, accommodation, and the uni itself, studying in Australia can still end up cheaper than the USA. Americans seem to love the idea of going to Australia, too.

[–] Rickard_Nutella 2 points 2 months ago

Sorry just seeing this, thanks for the recommendation.

I found out that the Nordic countries and Germany have full ride scholarships for International students. Germany has a national program called DAAD. Though they probably give most of them to domestic students. Some of the Nordics even help with other expenses, which is necessary due to their high cost of living.

Makes sense since Australia is also English speaking. Great idea I need to look into.

[–] MedicPigBabySaver 0 points 7 months ago (1 children)

State schools, community college. You bet. Although I'd like to see some amount of public service required during/after.

You wanna go to Harvard. Pay your way.

[–] Fedizen 1 points 7 months ago* (last edited 7 months ago) (1 children)

I think community service in lieu of debt payment is a phenomenal idea as long as its fairly generous in waiving debt such that part time community service should be able to waive medical school debt.

[–] MedicPigBabySaver 1 points 7 months ago

How about 10hrs of volunteer service per $10K debt/value.

Yes, it's low. But, very doable and should be 100% fulfilled.