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[COMMENTARY] Student Loan Forgiveness Should Not Be a One-Size-Fits-All

The glimmer of graduation season is upon us as the most disruptive year in education of the 21st century draws to a close.  More than four million college students persisted to the finish line in the stormiest of conditions. And though commencement may range from virtual to drive-through to in-person this year, there is one thing in common for college graduates who took out student loans: once they have that hard-earned diploma in hand, the clock for loan repayment starts ticking. 

(Photo by: Jeffrey Greenberg/Universal Images Group via Getty Images)

But, this year, there is hope for new graduates and the 44 million Americans struggling with student loan debt. The promise of federal loan cancellation has been sparked by a potential Presidential executive order and legislation proposed by Senators Warren, Schumer and other Democrats. With more than $1.7 trillion dollars of student loan debt, it’s time we act. On top of CARES Act measures that have extended student loan interest freezes through at least September, student loan cancellation discussions have ranged from $10k to as much as $50k per borrower. Those with loans who earn more than $125,000 may be exempt, but aside from that, cancellation should not be a one-size-fits-all award. There are groups who should receive more than others, and groups currently excluded who should be included. A baseline cancellation of $10,000 could be granted to all borrowers, but tiers of loan forgiveness will go a longer way. Specifically, we should prioritize and allocate more debt cancellation to those in or entering high-demand jobs, those who have been systemically oppressed, and lastly, to adult learners with some college but no degree.

We also should cancel a higher dollar amount on loans for current employees and recent graduates entering fields experiencing tremendous stress and a projected national shortage due to COVID-19. The teacher shortage “is worse than we thought” according to an Economic Policy Report. Given what teachers endured this past year, recruitment into this field is going to be more challenging than ever. Frontline healthcare workers have also been the sung and unsung heroes of this past year, but we need more of them and they need more relief. According to Mercer, there are serious workforce gaps that will affect “every health care provider.” These include a projected shortage of nearly 30,000 nurse practitioners by 2025. Medical technologists requiring a bachelor’s degree are also on the 15 most in-demand careers list by Indeed

Digging deeper into student loan debt by race, it’s staggering to see how racialized student debt has become. The Black-white disparity in student loan debt triples after graduation. On average, Black students graduate with more than $7,400 of debt compared to White graduates, but within a few years, that amount skyrockets to $25,000. It goes without saying that those white students who borrowed less for college can pay off their loans faster and begin to save and accumulate wealth at a faster rate than their Black counterparts. It’s just another example of a systemic cog fueling the Black-white wealth gap. Today, Black families’ median and mean net worth is $17,600 and $138,200, respectively, compared to the median and mean net worth of white families ($171,000 and $933,700, respectively). Additionally, Educationdata.org cites that “American Indian and Alaska Native student borrowers owe the highest monthly payments” compared to all races and that some groups delay life milestones due to debt, including Hispanic and Latino borrowers who are “the most likely to delay getting married and having children due to student loan debt.” The solution is simple: give a higher amount of loan forgiveness to Black Americans as well as other people of color impacted by loan debt at a higher rate than white people. By doing so, we would be taking long-overdue steps towards more racial justice in our country.

Adult learners with some college but no associate’s or bachelor’s degree are a key group not included in this year’s proposed debt cancellation. Why should we take a chance on those who haven’t crossed the finish line but who have accumulated debt? With 22 years of experience serving adult learners through online degree programs, I’ve observed that those who come back are highly motivated to finish what they started. Most realize that without a degree, they are stuck or unable to advance further in their careers. There are currently 36 million adults with some college, no degree, and an estimated 10% who are likely to return. Many have exhausted financial aid from their previously attended institutions or do not qualify for aid if they are taking less than half a full load of credits, which is common for adults juggling work, family, and school. Financial stresses have been shown to negatively impact persistence and graduation rates. The solution is simple: give those re-enrolling a debt-free start.

Hopefully, 2021 is the year we will see large-scale societal debt cancellation enacted. It’s going to take drastic measures to help the millions of Americans who are struggling most with upward social mobility while facing the long and arduous road of paying back loans. But it’s also an opportunity to make a statement about what matters most to us as a society. Let’s take the time to do it right by awarding accordingly and not in a unilateral manner. 

About the author:

Jessica DuPont serves as an executive director at Oregon State University Ecampus, and a Public Voices Fellow with The OpEd Project.



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