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Biden Announces Plan to Cancel Some Student Loan Balances Under $12,000 (www.the74million.org)

submitted 10 months ago by blorbo@lemmy.sdf.org to c/politics@lemmy.world

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[-] namelessdread@lemmy.world 7 points 10 months ago* (last edited 10 months ago)

This forgiveness is for people who have been paying on their loans for 10 years. I don't think there are many people who:

Took out under 12k
Have been paying for 10 years

AND

Make a lot of money

Why? Interest is a bitch. If there are people who meet those three conditions, there probably aren't many of them.

[-] jonne@infosec.pub 3 points 10 months ago* (last edited 10 months ago)

Honestly, the more I hear about the student loan crisis, the more I'm convinced that, if you're going to go with the line that outright forgiveness is politically toxic, they should just set the interest rate to 0%. A lot of people are basically just stuck paying interest without even hitting the principal, and that's the real problem.

This fixes a few issues:

the longer you've had your loan, with inflation it'll be a smaller part of your income (provided your income raises with inflation, which admittedly isn't a given in the US)
the conservative talking point of 'you borrowed the money, so you need to pay it back' is completely moot. Yes, you're paying it back (unlike the business owners that took out PPP loans).
the goal of those loans should be to fund your education, not for someone to make money off, and that would accomplish this.
it's still revenue neutral (minus the cost of administering, which really should just be done by government instead of outsourcing), even though MMT tells us that deficit spending for stuff like this would be totally fine.

Obviously the best solution is free education and universal loan forgiveness, but Democrats aren't willing to do that.

this post was submitted on 16 Jan 2024

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