While talking with my coworker recently, I found out that her mom’s college debt had been forgiven. Her mom went to grad school and many years later, in 2023, she finally received a letter of her student debt forgiveness. This made me recall recent news stories about student debt. While news stories regarding student debt are common, its impacts on individuals are overlooked. Student-debt is a harsh reality for many people in the U.S., and breaking down those news stories is essential to understanding its impacts.
September 2022, Biden administration announced a student-debt forgiveness plan. The proposed plan is essentially to forgive up to $20,000 of student debt for low-income individuals who qualify. However, this headline event became a supreme court case as Biden’s plan was challenged and sued. One of the arguments against Biden’s plan presented worries about whether a president has the authority to enact the proposed plan. The lawsuit presenting these worries was filed by the US states of Arkansas, Iowa, Kansas, Nebraska, Missouri, and South Carolina following the announcements. We expect to hear from the Supreme Court on that case by June or July. (CNBC).
Student-debt forgiveness is an incredibly relevant issue for us as students. Debt has a huge impact on marginalized communities because those are often the people who take out loans, get charged higher interest rates, and/or don’t earn high enough wages to pay back their debt as soon as they would like to. (CFPB). This disadvantage perpetuates the poverty cycle for thousands across the nation who hope for the bill to be passed. Why might people struggle to pay back these loans despite having college degrees and jobs? 48% of Americans, as of February 2023, live paycheck to paycheck. People are barely paying for necessities, leaving them with little to put in savings. The pandemic also imposed a financial strain on many — savings were used up during times of need and current inflation makes it increasingly difficult to save. This is just the tip of the iceberg when breaking down the financial stress on individuals. Overall, student debt forgiveness is hope for many Americans but politics delay action on numerous such issues of importance.
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