Much has happened since I wrote my last blog in early August. While it’s hard to know where to begin, I think the student loan forgiveness controversy is an important issue that requires our attention.
On the one hand, I understand the desire to relieve the burden of thousands of dollars in student loan debt that so many Americans carry. Those heavy debts prevent millions of people from buying homes or obtaining quality healthcare for their families, among other worthy goals. Often these very large debts are a drag on a borrower’s ability to live the American dream as well as on the nation’s economy. While student loans provided the opportunity for millions of Americans to attend college, for many they failed to generate the quality of life that a college education had promised. That just doesn’t seem fair.
In addition, Harvard economist Susan Dynarski, who once opposed student debt forgiveness, now believes that “targeted debt cancellation is the best way to undo the damage done to millions of borrowers by a persistently dysfunctional system of college funding and student loan repayment.” Ms. Dynarski argues that it was bad government policy that harmed student borrowers, “and it is government policy that should work to reverse it.”
On the other hand, millions of other Americans never went to college for one reason or another. While they work hard to pay the rent and feed their families, many of them cannot afford to buy a home or obtain quality healthcare for their families either. Yet, they are now being told that their tax dollars will go to help pay off their fellow Americans’ student loan debt while they continue to struggle to make ends meet. That just doesn’t seem fair, as well.
In 2017, the Trump administration and the Republican Congress enacted a $1.9 trillion tax cut, which greatly favored corporations and the wealthy at the expense of the middle and working classes. Now President Biden is offering relief to millions of people making less than $125,000 with college loan debt.
But what about the very large segment of working Americans who never went to college and don’t have student loan debt? Shouldn’t the government give them some financial relief in these difficult times, too? These are the people who make our country run: the store clerks, bus drivers, factory workers and restaurant staff. How can we afford to reduce corporate taxes and forgive student loans, yet not support those who are the backbone of America?
If the Democrats fail to rectify this gross inequity, they very well may lose at the polls and their right to govern. Hispanics and minority voters are already abandoning the Democratic Party. The party needs to demonstrate that it cares about the working class and their issues.
One possible solution would be for the Biden Administration to provide a sizeable tax rebate to working class Americans who were never able to attend college. Biden needs to promise to do just that if the Democrats maintain their hold on Congress. That would give those voters a good reason to stick with the Democrats and boost turnout in November.
On top of that, Rep. Alexandria Ocasio-Cortez recently suggested that Congress reverse the 2017 GOP tax cuts, which overwhelmingly benefited the rich and large corporations, to finance the cancellation of all remaining student loan debt. She noted that the government has “forgiven far, far more debt for business owners in the form of [Paycheck Protection Program loans to keep their businesses afloat] who didn’t need to meet ANY sort of income requirements or means testing for almost $1 TRILLION in forgiveness.”
Republican lawmakers are now against Biden’s student loan forgiveness. But many of these critics took out Paycheck Protection Program loans that the government forgave. For example, Rep. Marjorie Taylor Greene and her husband, owned a construction business which received a $182,300 loan from the program, and the loan was forgiven.
In addition, AOC indicated that if the Trump tax cuts were repealed there would be “money left over to contribute to universal childcare” and other needs of average Americans. While most Congressional Democrats support the repeal, they don’t have the votes in the Senate to overcome a Republican filibuster. Unfortunately, two Democratic senators, Manchin and Sinema stand in the way of eliminating the filibuster.
But, if the Democrats promise to repeal the filibuster, it would be another reason to vote for Democrats, boosting turnout and their chances of increasing their majority in the Senate. Then, the Democrats could eliminate the filibuster and rescind the 2017 tax cuts. That sounds like a very winnable Democratic platform. And truly fair as well.
Bruce Berlin, J.D.
A retired, public sector ethics attorney, Berlin is the author of Breaking Big Money’s Grip on America (See breakingbigmoneysgrip.com.), the founder of New Mexicans for Money Out of Politics, a former U.S. Institute of Peace fellow, and the founder and former executive director of The Trinity Forum for International Security and Conflict Resolution. He can be reached at firstname.lastname@example.org.
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