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. @POTUS makes an eminently reasonable case here for why $50k of universal debt cancellation is not the best use of limited funds when there are more targeted, comprehensive, & forward-looking ways the fed govt can help make college affordable & help borrowers who need relief most
$10k of cancellation alone is still a very progressive stance/massive investment that could help a ton of borrowers (including those most likely to default).
Finding ways to work through Congress to make this happen is a more sustainable (and less legally shaky way) to ensure cancellation of any kind doesn't get held up in court.
I agree with others that the targeting that's needed here isn't just about the type of school a student attended, but more about who is most at risk from taking on high student debt loads but see no return on that investment.
I assume the point Biden was trying to make is that the student who pays $60k/year to attend a crappy for-profit school has much worse odds of paying that off than a student who pays $60k/year to attend Harvard.
That's why debt cancellation conversations cannot happen in a vacuum--there are much bigger changes needed to ensure better transparency & ROI for students and ways to hold institutions accountable for terrible debt-to-earnings or price-to-earnings ratios: https://www.google.com/search?q=third+way+price+to+earnings+premium&rlz=1C1CHBF_enUS923US923&oq=third+way+price+to+ear&aqs=chrome.1.69i57j35i39j69i59.5281j0j7&sourceid=chrome&ie=UTF-8
He also touches on an important point--which is that the vast majority of Americans (~80%) don't have student loan debt of any kind. That's why we've also proposed at least expanding a $10k cancellation to be both forward- and backwards looking...
...by creating a $10k "Pay Down, Upskill" education credit that qualifying Americans could use to either pay down existing debt or use to gain new skills/credentials/degrees in a post-COVID economy: https://www.thirdway.org/memo/pay-down-upskill#:~:text=Known%20as%20%E2%80%9CPay%20Down%2C%20Upskill,%2D%20and%20four%2Dyear%20programs.
Lastly, I know it's wonky and not as sexy to talk about as debt cancellation, but the truth is that we have programs like income-driven repayment (IDR) that are designed to help struggling borrowers and ultimately lead to loan forgiveness down the line.
There are LEGITIMATE problems with IDR right now that require massive reforms, including making sure more borrowers even know these programs exist & auto-enrolling borrowers into these programs to avoid delinquencies/defaults in the first place...
All of this to say that I think Biden is on point to say that the focus around debt relief needs to be much more comprehensive than it has been to date. It's a legitimate policy debate about how to spend limited resources and glad to see him bring additional nuance the convo.
