higher education

Student-Loan Debt Is Immoral

Photo: Dorann Weber/Moment Editorial/Getty Images

The Biden presidency is still two long months away. But pundits and economists are eager to influence the president-elect before he even has a chance to take office. Consider, for example, the ongoing debate over a proposal that Biden may or may not take up when he finally evicts Donald Trump from the White House. In January, Biden could immediately forgive up to $50,000 in federal student-loan debt per borrower. As senators Chuck Schumer and Elizabeth Warren outlined in September, Biden has the legal authority to do so without the backing of the Senate. Republicans would not be able to block him from providing relief to millions of student borrowers in the middle of a pandemic.

Not so fast, some say!

Arguments against student-loan forgiveness are nearly as old as the idea itself. We saw a similar dynamic at work during the Democratic presidential primary, when candidates’ proposals to cancel some or all student-loan debt encountered similar resistance. Some criticisms resemble those directed at Bernie Sanders’s proposal for free public-college tuition: Debt forgiveness would transfer wealth to the already fortunate. Others have argued that, in the context of a pandemic, debt forgiveness wouldn’t be an effective stimulus provision, and that other policies ought to take precedence.

But these critiques aren’t very persuasive. Backlash might not materialize, for example. Nearly 90 percent of Americans agree that student borrowers have trouble paying back their loans, according to an October poll released by the Pew Charitable Trusts. Eighty-one percent said that the government should play a role in making it easier for borrowers to repay their debt. Though 61 percent said that borrowers could do more to prioritize loan repayment, that figure has decreased by 18 points since Pew published a version of the same poll last year.

Student-debt forgiveness can’t keep the economy afloat on its own, and it shouldn’t be the extent of Biden’s future stimulus plans. But the president-elect can do more than one good thing at the same time, if the mood takes him, and the Schumer-Warren proposal would in fact help a lot of people. In the U.S., student borrowers owe an average payment that ranges from $200 to $300 per month, and, right now, that’s money many households need. Even if the adults who run them happen to have majored in basket-weaving, or critical race theory, or cultural Marxism, or whatever bogeyman degree conservatives are worried about this week.

The hand-wringing over student-debt forgiveness instead looks like an attempt at misdirection. In burying the proposal with pedantry, its opponents hope to obscure an uglier truth. Collectively, the nation’s student-debt burden hit $1.5 trillion — an unsustainable phenomenon that represents deep societal rot. A college degree no longer means what it once did. Wages are stagnating. Even if a household reports middle-class income, its members can still buckle under severe debt burdens.

I have to confess here that I am not an economist, so I will leave equations to other people. But I also don’t think you need an economics degree to understand basic statistics, or to identify a falsehood when it comes out of someone’s mouth. College graduates may be easy targets for a conservative movement surrendering to the anti-intellectualism at its core, but reality is not quite so plush. Though I have never worked for a think tank, I am a former college freshman who once bet that a sensible college degree would earn me the economic security my parents did not possess. I attempted the Reverse Basket-Weaving: My parents are music-performance majors, so I chose international studies, thinking perhaps I would go into foreign policy. I didn’t, and while my current profession does not have the same reputation for stability, I’m still the only member of my immediate family who holds a salaried job with benefits. The point is that I tried to do what I was supposed to do. Now I have student loans that I’ll be paying off until I’m 40, while I live in one of the most expensive housing markets in the country. My partner is a veteran, and a first-generation college graduate, and he will be paying off his student loans until he’s 50. The GI Bill only goes so far.

This is not an unusual story. A neoliberal or conservative wonk may still point to it and tell me, “Move out of New York City”; or do the Dave Ramsey thing and eat beans until you’re out of debt; or, goddamn, buy your two cats some cheaper food. But, for me — and a lot of other people — moving is a hell of a lot easier said than done, especially if your industry insists on concentrating its workforce in a handful of major metro areas. Moving is also expensive! People forget this, maybe, when they don’t have to worry about money. As for Ramsey, his methods only make sense in an alternative America where medical expenses don’t regularly bankrupt families or where costs of living don’t limit the amount of money a household can use to pay down debt. The cats, I concede, could eat some cheaper slop.

What I’m dealing with, in other words, is a high debt burden proportional to my income. The burden is so heavy that it has delayed major milestones. My partner and I are soon-to-be newlyweds in our 30s with stable, full-time jobs and a combined income that places us firmly in a middle-class bracket. Thanks largely to our student-loan debt, we also don’t know how we’ll be able to afford kids. Our two-person household can afford rent in New York City, but not a mortgage. We have no savings and no assets. The Schumer-Warren proposal would wipe out our federally held student-loan debt, and let us keep $1,100 a month that we could save or use to pay down credit cards. At the same time, it would alleviate a major generational problem. I’m not the only person my age delaying life decisions because of debt: As NPR reported last year, homeownership among young adults ages 24 to 32 “dropped nearly 9 percentage points between 2005 and 2014,” and, according to the Fed, student-loan debt is responsible for around 20 percent of that decline.

As is generally the case with any form of economic inequality, student-debt burdens are heaviest overall on people of color. The Schumer-Warren resolution cites a working paper from the Roosevelt Institute, which notes that “student debt levels are growing at a higher rate for Black than for white borrowers.” The Century Foundation has similarly argued that student-debt burdens and existing racial disparities inform and exacerbate one another. In a report for the Center for Equitable Growth, economists Darrick Hamilton and Naomi Zewde wrote that four years after graduation, Black students “have an average obligation of more than $50,000, compared to less than $30,000 for the average white student,” a problem that, again, stems partially from an existing wealth gap between Black and white households. A bachelor’s degree can’t make up for bigger social problems — especially not when it comes with massive debt.

When you break the student-debt crisis down into details, and examine its causes alongside its broader social implications, the necessity of debt forgiveness becomes obvious. The pandemic just accelerated a reckoning that was already under way. According to an NBC News survey, three-quarters of all millennials were in debt in 2018 — years before the pandemic and the recession that followed it. Even so, 56 percent of millennial student borrowers surveyed by Morning Consult in 2019 said they believed their college educations justified the debts they incurred. But that’s not the case anymore. A new version of that survey, released after the pandemic began this year, discovered a 10 percent decrease in the share of young adults who say college was worth the debt.

Some opponents of pandemic-era student-debt forgiveness have thus inadvertently identified a bigger problem:

If Biden does forgive student debt on the terms outlined by Schumer, Warren, and their allies in the Senate, he invites a broader conversation about the realities of social mobility in the U.S. The old narratives we grew up with — get a degree to get a good job — don’t have much traction these days. To put matters in layman’s terms, everything is fucked. Higher education in the U.S. resembles a multilevel marketing scheme more often than it does real social mobility: Take out this money, study our life-changing material, and someday you’ll be able to support a family. What really separates college from such a scheme, though, is the quality of the material in question. In ways that are both material and psychological, college does change lives. Degree inflation means that a bachelor’s degree has become a minimum qualification for a growing number of jobs, so the rising expenses associated with a college education have broad implications. For many of us, there’s no way up without debt.

In this context, student-debt forgiveness looks quintessentially progressive. There are ways to strengthen the proposal by expanding its reach, though Biden’s ability to do so might be limited without the Senate. But forgiveness itself has to happen, and not just because there’s a pandemic. It’s also the moral thing to do. Higher education doesn’t have to be this expensive. It isn’t — in plenty of other countries. College costs as much as lawmakers allow it to; the student-debt crisis persists for the same reason. People who paid off their student loans ought to be angry, but with the government and their alma maters, not with other borrowers. You don’t solve one injustice by refusing to rectify another when you can. Biden shouldn’t hold debtors hostage to a broken system.

Student-Loan Debt Is Immoral