Student debt relief: A distraction from the roots of the debt crisis 

2
78

Toward the end of August, the Biden Administration’s announcement of their plan to eliminate up to $20,000 in federal student loan debt for individuals making an income of under $125,000 and households with a combined income of $250,000 ignited a fierce discourse between progressive advocates for debt relief and conservative opponents.  

Contention around debt relief is highly visible in national publications such as The Washington Post, in which its neutral to positive coverage of the plan and its effects is undercut by opinion pieces arguing the negative by means of old, zombified appeals to inflation and libertarian moral philosophy. The general public is posed with haughty questions like whether or not it’s just to renege on a financial commitment made on unfair terms; who will bear the responsibility for the vaguely-defined economic crisis that is supposed to occur after billions of dollars in debt is forgiven; and, most infuriatingly, why the model citizen who dutifully paid back their student debt should incur the tax burden of student debt forgiveness for others. 

Absent from the barrage of rhetoric that is largely constrained by liberal-capitalist and conservative-capitalist boundaries is one critical question: How did the $1.75 trillion crisis of student debt entangling 45 million Americans crash and burn to its current state, what mechanisms caused it and is it enough to forgive a small fraction of that?  

The Daily Campus Editorial Board categorically rejects limiting the debate between partial student loan forgiveness and a continuation of this subjugation by huge amounts of debt. We believe — it being the case that the conditions which cultivated the debt monster in the first place are still alive and well — that student debt relief of any amount is a diversion from the active exploitation of Americans seeking an education, a reality that makes the prospect of education as a human right in the United States even more distant.  

To be clear, we urge debt-holders who would benefit from relief to take advantage of the opportunity before them, as they can do via the Department of Education’s website; however, the framing of this plan as a “fix” or solution to a debt crisis with distinct systemic causes is simply incorrect.  

One glaring example of this begins in the text of the Administration’s announcement. The provision highlighting one final pause in student loan repayments states that this will be the last delay in order “to ensure a smooth transition to repayment and prevent unnecessary defaults,” or the failure to repay one’s debt and accrued interest. This poses the question of what constitutes a “necessary” default — does it truly make sense that millions of Americans are pushed into a situation where they can’t repay the exorbitant interest on loans whose original value may have been paid off long ago? 

Another lesson to be gleaned from this provision is that as soon as repayments resume and a portion of their debt is forgiven, lenders will likely face the same conditions which necessitated student loan forgiveness in the first place. At best, this plan is the Biden Administration’s haphazard olive branch to activists who organize around student debt forgiveness, such as the Debt Collective, it’s an obfuscatory delay in the acceleration of an issue Biden helped create. 

As the Senator of Delaware in 2005, Biden was one of 18 Democrats in the Senate who broke with their caucus and voted for Republican-led legislation which prevented debt-holders from declaring bankruptcy on their student loans, forcing many to either default on their outstanding loans or simply wish for a miracle.  

Finally, we needn’t look further than here at the University of Connecticut for the most major factor behind the student debt crisis: The gargantuan cost of attending college in America. The 180% increase in the real cost of attending college, including tuition, housing and other elements from 1980 to now is the most intuitive cause behind our current state of affairs, one that disproportionately harms Black and Latinx student borrowers. 

For a more local context, the state of Connecticut alone contains nearly 500,000 borrowers holding around $17.5 billion in debt. The scale of the issue stands right at our doorstep. UConn’s own culpability is overtly apparent through systematic increases in tuition, as well as enforcing the use of prohibitively expensive course materials — not to mention meal plans and residence hall fees that hemorrhage money from working class students and their families. Private universities such as Yale University, whose endowment hovers around $42 billion, use their vast resources to engage in perpetual investment strategies, seemingly negligent of the fact that the biggest benefit and reprieve to students would be using these funds to reduce the cost of attendance instead of enriching a capitalist stock market. 

We cannot rely on a benevolent administration or legislature to mitigate the student debt crisis; rather, the solution begins with students and borrowers taking control of institutions meant to serve them by means of coalition-building between students, faculty, campus workers and experienced activists. Education should be a human right that is free to students at the University of Connecticut and at every other public university. 

2 COMMENTS

Leave a Reply