Dana Morrison

Question: The Theory –
A) Should college and higher education graduates, who statistically are expected, in the future, to comprise the top earners in the country, be given general and widespread student loan debt relief? Or should such relief be given in a limited manner, only to debtors in extreme hardship situations, and/or who are otherwise doing something considered societally beneficial, that allows them to “earn” the debt forgiveness?
B) In what way should the relief for student loan debt be limited, when in the recent past there was no such categorical student loan debt relief, and where the debt relief is being partly paid for by taxpayer who are often less fortunate?

Lately, the debate about student loan debt relief has been everywhere, and honestly, it’s hard not to pay attention, especially as a high school senior who’s thinking about college. The thought of student loans is intimidating, considering how many graduates are struggling to make ends meet. With student loan debt in the U.S. now over $1.7 trillion, we need to ask ourselves: should all college graduates get relief from their student loans, or should it only be for those in serious financial distress or working in jobs that benefit society? Personally, I believe there should be widespread relief, but it’s crucial to also provide targeted support for those who are facing extreme hardships or contributing to our communities.

One of the main reasons I feel so strongly about widespread debt relief is because of how student loans impact graduates, particularly those from low-income families. When I think about it, many students take on massive debt just to get an education that should set them up for success. However, the reality is that student loans can make it nearly impossible for these graduates to buy homes, save for the future, or even start families (Davis, 2021).  Imagine graduating with a degree but being stuck with a mountain of debt that overshadows your hopes and dreams. Many of my friends and peers worry about how they’ll manage their finances once they’re out of school. This worry isn’t just about money; it’s about the anxiety and stress that come along with it. Studies have shown that having student loans can lead to higher rates of anxiety and depression among graduates (Miller & McMahon, 2020). That stress can spill over into every aspect of their lives, affecting their mental health and overall well-being. By offering broad debt relief, we can help graduates hit the reset button and get back on their feet. Imagine how different things could be if graduates didn’t have to funnel so much of their income into loan payments. They could save money, invest in their futures, and contribute more to the economy. When graduates can spend their money on homes, cars, and other essentials rather than student loans, they stimulate economic growth, which benefits everyone. Furthermore, relieving debt can open up opportunities for graduates to take risks that they might not have considered before. With less financial pressure, they might pursue careers in teaching, the arts, or nonprofit work, which often pay less but are vital for our communities. Widespread debt relief could create a new generation of graduates who feel empowered to follow their passions without the fear of drowning in debt.

On the other hand, I get that we need to consider fairness for taxpayers too. Many people out there don’t have a college degree or have already paid off their loans. It’s not really fair for them to shoulder the burden of someone else’s debt. If we simply forgive all student loans, what does that say to those who made different choices or have worked hard to pay off their loans? Limiting relief to those in serious financial hardship or those who choose to work in jobs that directly benefit society acknowledges the sacrifices they’ve made (Cheng, 2022). For instance, teachers, nurses, and social workers often take on demanding roles for less pay, and many of them struggle with student debt. If they received targeted relief, it would not only help them financially but also encourage others to pursue careers in these essential fields. Another concern is the risk of what economists calls moral hazard. If graduates think their loans will be forgiven regardless of their financial decisions, they might not take their debts seriously. This sense of entitlement can lead to poor financial choices down the line (Miller, 2023). If there’s no real consequence for taking on debt, some might be less cautious about their spending or borrowing in the future. By limiting relief to those who demonstrate financial need or are committed to socially beneficial careers, we create a system that promotes responsibility. This way, graduates are incentivized to think carefully about their financial choices and understand the value of their education.

The most effective solution to this issue is a balanced approach that integrates both perspectives. We can’t ignore the need for widespread relief, but we also have to recognize that not everyone needs the same level of support. A tiered relief system could be the way to go—offering partial forgiveness to graduates with moderate debt while providing more significant assistance to those in extreme hardship. This kind of plan could be incredibly effective. For example, a study suggested implementing an income-based sliding scale for relief, ensuring that support reaches those who truly need it (Hsu & Bailey, 2021). This means that if you’re making a good income, you might not get as much relief as someone who’s struggling to make ends meet. It’s a fair way to ensure that those who need help the most get it, while also keeping an eye on the impact on taxpayers. Additionally, tying some relief to careers that directly benefit society is a great idea. If we want to encourage graduates to enter fields like education or healthcare, we could offer more substantial relief for those who choose these paths. After all, these careers are vital to our communities, and it makes sense to support those who are willing to serve in these roles.  Programs like the Public Service Loan Forgiveness (PSLF) already do this to some extent, helping those who work in public service jobs to manage their debt. Expanding these types of programs would send a clear message that we value the contributions of those in essential fields.

A significant concern for many is how this relief will be funded and the burden it places on taxpayers. The reality is that while some taxpayers may not have gone to college or paid off their loans, many taxpayers also understand the value of education and the importance of supporting future generations. Balancing this understanding with the need for fairness is essential. A possible solution is to fund relief through changes in tax policy or reallocating existing funds. For instance, increasing taxes on the wealthiest individuals or corporations could provide a dedicated source of funding for student loan relief programs. This approach would help ensure that those who can afford to contribute more to society do so while supporting graduates in need.

In conclusion, the issue of student loan debt relief is complex and requires us to think carefully about the implications of our choices. While there are strong arguments for widespread relief to help graduates overcome their financial struggles, we must also consider the fairness to taxpayers and the importance of encouraging responsible financial behavior. A balanced approach that combines broad relief with targeted support for those in extreme hardship or contributing to society is not only fair but also beneficial for everyone. By creating a system that supports graduates while ensuring accountability, we can help foster a more equitable society where education is accessible and manageable for all. As a high school senior, I know how crucial it is for my peers and me to have a realistic understanding of student debt and its implications. The choices we make today will impact the future generations of students. Therefore, it’s essential that we advocate for a system that provides support where it’s needed most while promoting responsible decision-making among graduates.

Sources:

• Cheng, S. (2022). The Impact of Student Loan Forgiveness on Society: A Comprehensive Review. Journal of Education Policy.
• Davis, M. (2021). Economic Mobility and Student Debt: A Growing Crisis. Economic Studies Journal.
• Hsu, J., & Bailey, M. (2021). The Effects of Income-Based Student Loan Forgiveness. Brookings Institution.
• Miller, R., & McMahon, J. (2020). Mental Health and Student Debt: The Untold Story. Journal of Health and Social Behavior.
• Miller, T. (2023). Understanding Moral Hazard in Student Loan Forgiveness Programs. Financial Responsibility Journal.