Huron Plainman | One step, not the complete solution

“I take two steps forward
I take two steps back
we come together
Because opposites attract
“Opposites Attract” – Paula Abdul ft. The Wild Pair

Back when MTV was still playing music videos, I have a distinct memory of this one. Paula Abdul, then best known as the incredible choreographer of the Laker girls, danced with an animated cat and sang a duet! My 10 year old mind was blown away by how someone could play and dance to a cartoon – it must have taken considerable talent!

Playing on an “80’s hits” station recently, this song popped up, and the lyrics seemed so fitting for a much-misunderstood effort going on in Washington.

On August 24, President Biden announced he was signing an executive order that was to be part of a three-part plan to change the massive student loan problem in this country.

The first part has been widely covered in a partisan fashion – the immediate remission of $10,000 in student loans to people earning less than $125,000 or up to $20,000 remission to those with Pell Grants. Although I won’t go into detail, one area that has often been omitted from coverage is that borrowers who paid during the pandemic when federal student loan repayment was suspended will receive reimbursement for being diligent. in loan repayment throughout the pandemic.

Rewarding those who repaid their loans responsibly is also an angle that hasn’t been mentioned once in the Executive Order’s coverage, I don’t believe.

The second part of the plan is to fix the Civil Service Loan Forgiveness Program (PSLF). The PSLF program has been in place for four presidential administrations to this point, originally created under President George W. Bush to encourage workers to take jobs in nonprofit organizations, the military or in some government positions, especially those in rural or underserved areas. .

This program has expanded over time to include educators in at-risk neighborhoods (added under the Bush administration), mental health workers (added under the Obama administration), and other social workers (also added under the Obama administration).

The problem is that funding for the administration of the program has been left in the hands of Congress, and neither party seems to find the program a particular selling point at election time, so it has often been left without adequate funding for staff and/or oversight.

That means thousands and potentially hundreds of thousands of Americans have been denied loan forgiveness already because they were willing to work in lower-paying jobs, with extreme hours, additional risks, and often fewer opportunities for immediate promotion.

These jobs serve millions of Americans with vital services they desperately need, but those willing to make the financial sacrifice to ensure all have proper service have been left behind by a program that was not not properly staffed, lost paperwork and had no oversight to see this happening for years.

Obtaining the backlog of PSLF-eligible rebates is estimated to have a greater impact than the $10,000 rebate that was announced, just to give an idea of ​​the severity of the mess the PSLF program has faced.

Finally, the third part is to dramatically increase Pell grants and set up accountability committees within the Department of Education to audit school costs nationwide. Pell Grants are essentially free money for a college, so they are going to be used as a way to control college costs – with costs rising too quickly in a particular college, Pell Grants will be removed or greatly reduced in the establishment.

There was a time in this country when higher education was considered important enough that world-renowned institutions like Cal-Berkeley were free to attend, paid for by taxpayers, even for those outside of it. State. Even prestigious schools like Harvard and Yale for a full year of tuition cost $400 in 1930, roughly the total of the average worker’s salary for 4-5 months. It would obviously take time to save that kind of money, but it was viable.

Harvard in 2022 costs a student over $70,000 a year to attend. The average family income in 2021 was just under $88,000, which means a family would have to pay 10 months of gross income to pay for a year’s expenses at Harvard for a student now. This is at least double, adjusted for inflation, and allowing a family income to cover the costs rather than a single income in 1930. The word “viable” tends to leave the discussion at this level of cost .

The sad reality is that college costs had one focal point when they soared: integration.

The university was considered “high intelligence”, even when it was free, so much so that those who belonged to the middle class or the lowest incomes before integration were often considered extreme outsiders on a university campus. .

When universities were forced to integrate, some of the schools that fought the hardest were those in that “prestigious” bucket, schools whose endowments were in the nine figures in the 1960s and are now in the billions. dollars for some schools (Harvard’s is more than $53 billion, for example). These schools wanted to keep the “riff raff” of the campus, assuming, of course, that those of different backgrounds, races, and financial backgrounds denigrated the collegiate atmosphere. Making the institute incredibly expensive was the “answer” to keeping the university for the elite.

Prices rose rapidly from the 1960s, but the 1980s saw a shortfall in the national budget that enterprising DC economists bailed out using colleges, leading to the final price push to where we are at. are today.

At the time, the federal student loan limit was a paltry $2,500 a year. Keeping with the Harvard theme, the cost to attend Harvard in the mid-1980s was around $15,000 per year. These economists saw that increasing the loan limit would allow more people to borrow, which would bring more money to the government as (supposedly) those people repaid their loans.

A freshman starting college in 2022 can take $31,000 in federal student loans for four years of undergraduate study as a dependent and $57,500 as an independent student. This allowed more people to borrow to go to school, but many of those who attended school were unable to repay the loan for a host of reasons, and legislation passed in the late years 1970 made federal student loans something that cannot be discharged during bankruptcy proceedings, meaning that even someone declaring bankruptcy is still saddled with student loan debt.

To capture the impact of the decision to increase the borrowing capacity of students, the country’s debt has increased significantly since the 1980s, largely due to this decision to increase the maximum amount of student loans that can be contracted. About 50-65% of the entire $2.5 trillion national deficit is student loan debt owed to the government, with some estimates suggesting it could amount to as much as 70-75% of the total national debt.

Former President Barack Obama recently appeared on the Netflix series ‘The G Word’ with Adam Conover and explained that while many would love to see instant action in Washington, D.C., the truth is most of the work being done looks like the direction of a very large ship. A full turn of the wheel moves the ship only slightly, but it Is move the ship.

While many may disagree with elements, or all, of Biden’s executive action, it’s the first turn of the wheel to move the ship of college fees and student loan debt that absolutely needs to turn. in this country.

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