By Emma Camp and Danielle Thompson, Reason
For many of the 43 million Americans weighed down by student loan debt, making their monthly payments is a major drag on their lives. About a third of undergraduates going for a bachelor’s degree are either dropping out or taking more than six years to graduate, which means that lots of people carrying student debt don’t even have a degree. Others are finding that what they learned in college doesn’t even help them get a job.
Federal student loan debt hit $1.6 trillion last year. This is a major problem for people in their 20s and 30s. But the federal government simply wiping their debt clean is just about the stupidest way to address it.
Forgiving student loan debt altogether, as Sen. Bernie Sanders (I–Vt.) promised on his 2020 presidential campaign trail, would mean printing more than a trillion dollars, thus driving up inflation and bringing the federal government even closer to insolvency. While President Joe Biden hasn’t proposed going this far, he has said he wants to forgive $10,000 per borrower. In the meantime, he’s been using his executive authority to whittle away at the debt load, including a recent $85 billion expansion of loan forgiveness programs.