With unemployment rates higher than during the great depression, the loss of over 300,000 lives, and major interruptions in everyone’s life plans, we are all feeling the effects of COVID-19. Students in particular have suffered, with remote learning, limited social interaction, and limited job opportunities for recent graduates, there have been disappointments across the board. In the face of such a terrible year, student debt relief would help students recover from the disastrous effects of the pandemic. The U.S. government should, at least partially, cancel student loan debt, because it will help close the racial wealth gap, and closing the racial wealth gap will benefit the United States. And, cancellation of student loan debt will stimulate the economy, which is necessary due to the current economic crisis.
Student debt relief will shrink the racial wealth gap, and doing so would benefit Americans by boosting the economy. By closing the racial wealth gap, the U.S. could see a 4-6% increase in USA GDP, by 2028.
Student debt forgiveness would aid in this, because student loan debt is especially limiting for Black families. As a result of centuries of systemic oppression, Black students have less ability to repay their loans due to racial wealth disparities. For similar reasons, Black families are disproportionately acquiring student debt, as Black students have a higher likelihood of need to take on debt to pay for education. Student debt cancellation would increase overall net worth for Black families, which would help close the racial wealth gap. Moreover, student debt contributes to racial wealth inequality, because of the disparities between white and Black families’ amount of student debt taken on.
Some critics of student debt cancellation believe that the United States should not cancel student loan debt because it is unfair to those who have already paid off their loans. This stems from the fact that the current proposals for student debt forgiveness plan to cancel debt on a single day, meaning that those who paid off their loans just a day before would not receive any benefit from loan cancellation. While this is an interesting area for exploration into how retroactive debt forgiveness could be implemented, this is not a fair reason to oppose student debt cancellation. Just because people have suffered from something in the past, it does not mean that it is unfair to prevent others from suffering from the same thing in the future.
Cancellation of student loan debt is also a good idea because it will stimulate the economy, and stimulus is vital in order to create economic recovery. The United States is currently experiencing a recession, with over 44 million Americans filed for unemployment. In the case of student debt cancellation, the projected GDP increase is $86 billion-$108 billion per year on average. Furthermore, cancellation of student loan debt allows recent graduates to buy homes, and pursue business opportunities, which will benefit the economy.
It is absolutely true that cancelling student loan debt does not address the rising price of homes, rising cost of medical care, and rising cost of living overall. However, this does not mean that student debt forgiveness is futile. Forgiveness of student debt is not a be-all-end-all solution, however, it can significantly reduce the economic burden placed on families. Although debt forgiveness will not solve all of the factors contributing to the nation’s current economic crisis, it will take some burden off the backs of families.
We are in the midst of an economic crisis, and action must be taken to recover our economy now. Families across the nation are drowning in debt. Although it’s not a complete solution, student debt forgiveness is beneficial to the United States. It is necessary to immediately enact student debt forgiveness as a primary step in recovering our country from this crisis. Student debt cancellation may not be a perfect solution, but it is a step in the right direction for our nation.
Lucie Brock, a Greenfield resident, is a first-year student at Smith College.