There is growing sentiment within Congress, the Biden administration, and the general public for some or all of existing student loan debt to be wiped out, according to a published report and the results of a recently released poll.
Nearly two-thirds of respondents to a poll indicated they were in favor of forgiving a flat amount of student loan debt and more than half of the respondents were for wiping away all of it.
That data could give President Joe Biden more capital as he seeks a solution to solve the student loan debt crisis in America. Aside from mortgages, the biggest category of debt owed by Americans is the $1.55 trillion of unpaid student loans. Further fueling an initiative aimed at eliminating student loan debt was buoyed by the results of the Senate runoff elections in Georgia, which gave Democrats a majority in both houses of Congress. One research firm wrote that there is a “high likelihood” that student loan debt relief will be included in a future relief bill aimed at helping Americans cope with the COVID-19 pandemic, according to a published report.
One plan being floated would be to cancel $10,000 of student loan debt for everyone, which would wipe out about $370 billion and eliminate debt for 15 million individuals who owe less than that amount. But such a move would unlikely achieve its intended effect — stimulating the economy.
While dealing with student loan debt already on the books could help solve the problems of individuals who are in college or have already graduated or otherwise left school, it would not do anything for those about to head to college in the coming years, experts noted, thus allowing the debt cycle to just restart for a new generation of students.
“The problem with forgiving student debt is that every day we’re making new loans in this broken system,” says Adam Looney, an economist at the University of Utah, in a published report
