Biden’s Loan Forgiveness Plan
October 30, 2022
On Aug. 24 President Joe Biden announced a three-part student loan relief plan to cancel $10,000 for middle to low-income borrowers in the United States.
This action was taken due to the large amount of people unable to go to college or choosing against it due to the amount of student loan debt.
According to Intelligent.com, 34% of 18-24-year-olds who aren’t currently enrolled in college are choosing to do so because they can’t afford it. Another 29% say it’s a waste of money.
Since 1980, the cost of an average four-year public college and even a private four-year college has almost tripled, even accounting for inflation.
“The Biden Administration is following through on that promise and providing families breathing room as they prepare to start re-paying loans after the economic crisis brought on by the pandemic,” a statement released by the Whitehouse said.
Biden’s loan relief plan will function in three different parts.
Part one is an extension of the student loan repayment pause. The Biden-Harris Administration will extend this pause through Dec. 31, and payments will resume in Jan. 2023. People are eligible for this relief if their individual income is less than $125,000 individually or $250,000 per households.
The second part will make the student loan system more manageable for current and future students. It aims to fix the Public Service Loan Forgiveness program and cut the monthly payments of undergraduate loans in half.
Part three is working to protect future students by reducing the price of college and holding the schools responsible for increasing prices.
However, this plan has created some outrage and controversy.
Some people find this unfair as they had to work hard and diligently to pay off their loans while the government is giving these people “handouts.” Others believe that it will increase the amount of college costs.
“If we’re introducing the idea that we may be canceling more student loans in the future, we’re encouraging people to spend more, to borrow more, increasing demand for college and potentially causing further tuition inflation,” a senior at the American Enterprise Institute, Beth Akers said on an NPR interview.
Despite opposition, the three-part plan has been approved. United States citizens of all ages are anticipating effects, but only time can reveal its success or failure
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Image provided by: Photographer Eric Hayes on ACCT at https://www.acct.org/article/acct-statement-president-bidens-student-loan-debt-forgiveness-plan