Attorney Explains Why Student Debt Cancellation Might Be Good For The Economy, Goes Viral On Twitter
Today, in the US, college graduates earn roughly 80% more than people with just a high school diploma. This means that college is more important than ever in order to secure financial stability in the future. However, college is also more expensive than it was ever before—thanks to that, some 44 million Americans collectively hold more than $1.6 trillion in student debt. The situation is described among experts as a “crisis,” and it’s hard to disagree with them. On top of the debt crisis came coronavirus together with economic struggles and between mid-March and June, according to CNBC, over 42.6 million Americans filed for unemployment.
“Pull yourself up by your bootstraps,” some may suggest, but sadly, it’s not always as easy as it seems. During the recession of 2008, many went back to school to earn new skills, but since then, the cost of a four-year college degree increased by 25%. Therefore, there are experts and researchers who are saying that if student debt gets written off, everyone can benefit from it.
Bharat Ramamurti, a former top economic adviser of Senator Elizabeth Warren during her presidential campaign, recently went viral on Twitter for making a case for broad student loan debt cancellation via executive order. Scroll down below to read the Twitter thread and tell us what you think in the comment section!
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Around 44 million Americans collectively hold more than $1.6 trillion in student debt
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The average cost of tuition, fees, room, and board during the last school year was $21,950 for in-state students at public universities. Out-of-state students pay $38,330, while the cost at private non-profit universities is a whopping $49,870. According to an estimate by The College Board, today, college graduates leave school with an average debt of $29,000.
According to the lawyer Bharat Ramamurti, this has got to change
Image credits: BharatRamamurti
Image credits: BharatRamamurti
Image credits: BharatRamamurti
Follow the link here.
Image credits: BharatRamamurti
Follow the link here.
Image credits: BharatRamamurti
Follow the link here.
Image credits: BharatRamamurti
Follow the link here.
Image credits: BharatRamamurti
Image credits: BharatRamamurti
Image credits: BharatRamamurti
Image credits: BharatRamamurti
Image credits: BharatRamamurti
Follow the link here.
Image credits: BharatRamamurti
Follow the link here.
Image credits: BharatRamamurti
Image credits: BharatRamamurti
Here’s how people reacted to the thread
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Whilst the Australian system isn’t perfect, it is still a decent program that we have to help with tertiary education costs. In Australia you don’t start paying the fees until you get a job and start earning over a certain pay threshold and gets taken out through your tax. You can choose to make voluntary payments if you wanted to. The other bonus is that it is interest free, the cost does go up slightly every year to keep up with inflation but that is usually less than a 2% increase. If you never reach the income threshold to pay the HECS debt or you die, then the debt gets wiped clean.
That's a great system, it doesn't grind the poor underneath society's heel. It's a compassionate system because the interest doesn't skyrocket and you only start paying when you are actually able.
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I have been paying student loans since 2006. I'm still paying. I just finished one off. I still have the largest one of $30,000 owed. It was 30,000 back in 2006, and it is still that amount because of recession, unemployments, temp jobs, etc. Deferments were necessary. So here I am, 14 years later still paying and it never goes down.
Cancel my home loan while you are at it. I have been paying since 2005.
But where would that leave renters, who are often locked out of the housing market and paying their landlords mortgages for them
Load More Replies...
I think that the answer is multi-faceted: Target the costs of education; the insane interest on loans; and forgiveness over a certain amount (e.g., if any one loan exceeds $X amount, it will be forgiven, but if you have other loans, smaller amounts, those are still to be paid)... I dunno. I'm feeling my way along. My debt was paid a long time ago, but I haven't forgotten what it was like to need to pay more on the loan than on rent and food combined.
Paying off student debt will only encourage even greater increases in tuition. Universities waste what funding they have now and subsidizing even more useless degrees and graduates who provide no utility to the economy would be a disaster.
As one of the quoted reply's noted, colleges and universities need to bear some kind of cost here, possibly related to the profitability of their students' degrees, adjusted for rates of tuition (not a perfect metric, but a good place to start perhaps).
Load More Replies...
They could at least make federal student loans interest free. After graduating and getting a real job my monthly tax responsibility went up by more than 20 times what my student loan payment is.
Student loans ruined my life...along with myself by not being able to afford them once they came due. Now I'll never be able to buy a home, replace a car, get real credit. All the credit I get hurts me with their annual fees and high interest and low balances. I'm wealthy but now I'm credit score poor and can't really fix that without getting through my defaulted 50k in student loans. Now that I can afford them they are in default:(
This whole problem would go away if we could figure out how to teach our children the skills and knowledge needed to get a decent-paying job in the K-12 years of education we are already paying forward for each child. College needs to be for medical doctors, STEM fields, and teachers. Liberal arts are by-and-large just a bait-and-switch sales gimmick. Besides, has anyone looked at what master plumbers, master electricians, HVAC technicians, and auto mechanics make on average? It will shock you, and most liberal arts degrees will never pay anywhere close to the pay for highly skilled trades.
Fixing the education system would certainly be a good start.
Load More Replies...
Yes, higher education needs to be massively restructured. First and foremost, all students should be required to work while they are taking classes. This should be considered part of their education. Secondly, every undergraduate should be required to spend a semester working and studying in a third world country. . . . As for those who currently have student loan debt, if I am not mistaken I believe there is debt forgiveness available for working in certain federal programs both domestically and internationally. This is actually a fantastic opportunity to travel and contribute to humanity while building skills and your resume, and getting rid of those loans. The best solution to this "crisis" would be to expand these forgiveness program opportunities, as the labor is so desperately needed by underserved communities everywhere.
The US government did offer debt forgiveness programs for people who went into teaching or public service and then reneged on the forgiveness. I’m too lazy to Google the exact details but it shouldn’t be too hard to find.
Load More Replies...
ME, ME, ME, ME. The American approach to every proposal to try and solve problems and improve living conditions for a vast group of US citizens. And that's why no one gets a better life in the US. "It doesn't do ME, ME, ME, ME any good, so I'm sure as hell won't allow that it does anyone else some good."
Load More Replies...
Do you even know what Liberal Arts is? Steve Jobs had a liberal arts degree. The CEO of YouTube has a Liberal arts degree, the CEO of Starbucks, the CEO of Campbell's soup, the CEO of american express... The list goes on and on. I think liberal arts only gets a bad wrap because it has the word liberal in it.
Load More Replies...
All right, raise taxes. Particularly on the rich. Close loopholes. Stop giving highly profitable billion dollar corporations the ability to not pay any taxes at all. Raising taxes doesn't have to equate to raising taxes on the middle class. The "eff you, I got mine" class can afford to pay a little more of their share. That won't crash the economy, rich people won't flee en masse, corporations won't all relocate overseas (though some accompanying legislation regarding requirements to do business in the US might not be unwise). And further, nothing is free? Come on, Trump himself inherited like $400 million dollars. Do you think we'd know who he is if started out in the projects? So many of the people in government right now, whether congress, or appointed by trump or prior administrations are trust fund babies. Nothing is free, give me a break...
Load More Replies... Whilst the Australian system isn’t perfect, it is still a decent program that we have to help with tertiary education costs. In Australia you don’t start paying the fees until you get a job and start earning over a certain pay threshold and gets taken out through your tax. You can choose to make voluntary payments if you wanted to. The other bonus is that it is interest free, the cost does go up slightly every year to keep up with inflation but that is usually less than a 2% increase. If you never reach the income threshold to pay the HECS debt or you die, then the debt gets wiped clean.
That's a great system, it doesn't grind the poor underneath society's heel. It's a compassionate system because the interest doesn't skyrocket and you only start paying when you are actually able.
Load More Replies... I have been paying student loans since 2006. I'm still paying. I just finished one off. I still have the largest one of $30,000 owed. It was 30,000 back in 2006, and it is still that amount because of recession, unemployments, temp jobs, etc. Deferments were necessary. So here I am, 14 years later still paying and it never goes down.
Cancel my home loan while you are at it. I have been paying since 2005.
But where would that leave renters, who are often locked out of the housing market and paying their landlords mortgages for them
Load More Replies... I think that the answer is multi-faceted: Target the costs of education; the insane interest on loans; and forgiveness over a certain amount (e.g., if any one loan exceeds $X amount, it will be forgiven, but if you have other loans, smaller amounts, those are still to be paid)... I dunno. I'm feeling my way along. My debt was paid a long time ago, but I haven't forgotten what it was like to need to pay more on the loan than on rent and food combined.
Paying off student debt will only encourage even greater increases in tuition. Universities waste what funding they have now and subsidizing even more useless degrees and graduates who provide no utility to the economy would be a disaster.
As one of the quoted reply's noted, colleges and universities need to bear some kind of cost here, possibly related to the profitability of their students' degrees, adjusted for rates of tuition (not a perfect metric, but a good place to start perhaps).
Load More Replies... They could at least make federal student loans interest free. After graduating and getting a real job my monthly tax responsibility went up by more than 20 times what my student loan payment is.
Student loans ruined my life...along with myself by not being able to afford them once they came due. Now I'll never be able to buy a home, replace a car, get real credit. All the credit I get hurts me with their annual fees and high interest and low balances. I'm wealthy but now I'm credit score poor and can't really fix that without getting through my defaulted 50k in student loans. Now that I can afford them they are in default:(
This whole problem would go away if we could figure out how to teach our children the skills and knowledge needed to get a decent-paying job in the K-12 years of education we are already paying forward for each child. College needs to be for medical doctors, STEM fields, and teachers. Liberal arts are by-and-large just a bait-and-switch sales gimmick. Besides, has anyone looked at what master plumbers, master electricians, HVAC technicians, and auto mechanics make on average? It will shock you, and most liberal arts degrees will never pay anywhere close to the pay for highly skilled trades.
Fixing the education system would certainly be a good start.
Load More Replies... Yes, higher education needs to be massively restructured. First and foremost, all students should be required to work while they are taking classes. This should be considered part of their education. Secondly, every undergraduate should be required to spend a semester working and studying in a third world country. . . . As for those who currently have student loan debt, if I am not mistaken I believe there is debt forgiveness available for working in certain federal programs both domestically and internationally. This is actually a fantastic opportunity to travel and contribute to humanity while building skills and your resume, and getting rid of those loans. The best solution to this "crisis" would be to expand these forgiveness program opportunities, as the labor is so desperately needed by underserved communities everywhere.
The US government did offer debt forgiveness programs for people who went into teaching or public service and then reneged on the forgiveness. I’m too lazy to Google the exact details but it shouldn’t be too hard to find.
Load More Replies... ME, ME, ME, ME. The American approach to every proposal to try and solve problems and improve living conditions for a vast group of US citizens. And that's why no one gets a better life in the US. "It doesn't do ME, ME, ME, ME any good, so I'm sure as hell won't allow that it does anyone else some good."
Load More Replies... Do you even know what Liberal Arts is? Steve Jobs had a liberal arts degree. The CEO of YouTube has a Liberal arts degree, the CEO of Starbucks, the CEO of Campbell's soup, the CEO of american express... The list goes on and on. I think liberal arts only gets a bad wrap because it has the word liberal in it.
Load More Replies... All right, raise taxes. Particularly on the rich. Close loopholes. Stop giving highly profitable billion dollar corporations the ability to not pay any taxes at all. Raising taxes doesn't have to equate to raising taxes on the middle class. The "eff you, I got mine" class can afford to pay a little more of their share. That won't crash the economy, rich people won't flee en masse, corporations won't all relocate overseas (though some accompanying legislation regarding requirements to do business in the US might not be unwise). And further, nothing is free? Come on, Trump himself inherited like $400 million dollars. Do you think we'd know who he is if started out in the projects? So many of the people in government right now, whether congress, or appointed by trump or prior administrations are trust fund babies. Nothing is free, give me a break...
Load More Replies...
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