Argument Map - Student Debt Crisis by Adam Derbala

Is Rising Student Debt Harming the U.S. Economy?

ad1893 — 2024-04-15 10:09:29 UTC

WRITTEN BY

Return on Investment

ad1893 — 2024-04-15 10:21:11 UTC

While college tuition is increasing, college still provides a great return on investment which Bachelors degree holders earning 1.8 times those who only have a high school diploma and those holding PhD's or other professional degrees earning more than 2 times.

This can vary however depending on the major pursued as well as the institution attended

Central Claim

ad1893 — 2024-04-15 10:31:37 UTC

Student loan debt is a growing economic concern that may be harming the US economy.

How should the United States address the growing student debt crisis?

Summary:

"For decades, the U.S. government has helped students finance their higher education to bolster the country’s economic competitiveness and national security.

U.S. student loan debt has ballooned in recent years, outpacing most other forms of consumer borrowing.
President Joe Biden has launched several plans to provide student debt relief, but they have sparked intense opposition and legal challenges" (CFR 2024).

Federal Policies

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Socioeconomic Equality

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"large-scale debt cancellation would help advance racial and socioeconomic equality and boost the economy"

Addressing Rising Costs

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"Student debt has more than doubled over the last two decades. As of March 2023, about forty-four million U.S. borrowers collectively owed more than $1.6 trillion in federal student loans."

In previous decades, many did not attend college and of those who did, "less than half borrowed money to do so." The idea of not attending college in todays world has become stigmatized leading to more people attending college and the cost of tuition increasing. Now, more people than ever are taking out student loans.

The majority of students graduate with less than $20,000 in debt while 7% of borrows owe over $100,000. "However, borrowers with smaller amounts of debt often have a more difficult time repaying their loans, as higher debt from graduate or professional degrees can pay off with much higher incomes."

Debt Forgiveness Programs

ad1893 — 2024-04-15 10:47:41 UTC

Implementing these programs will alleviate a major burden that students experience while also stimulating economic growth.

The government currently offers:

Need-based tuition grants (Pell Grants)
Student loan programs
Veterans Benefits
Research Grants

"Funding levels for the program [pell grants] have not kept pace with the rising cost of college, resulting in more students turning to loans.

PRO: Debt Forgiveness

ad1893 — 2024-04-15 10:50:32 UTC

Many feel that debt forgiveness is necessary due to the rising cost of college tuition. This is a way to stimulate the economy while also bridging the gap between socioeconomic groups by allowing

CON: Debt Forgiveness

ad1893 — 2024-04-15 10:51:04 UTC

Many feel that large scale debt forgiveness will only benefit those who took out higher amounts of debt and that will be more likely to pay it off. Doctors and lawyers for example will take out more debt, but will be more likely to pay them back due to higher earning.

Many also feel that it is not reasonable to burden tax payers with paying for these debt forgiveness programs

Biden's Plan

ad1893 — 2024-04-15 10:55:36 UTC

Biden attempted to forgive "$20,000 in student debt for Pell grant recipients and up to $10,000 for non–Pell grant recipients who make less than $125,000 per year" through the use of an executive order. This plan was struck down by the Supreme Court and deemed unconstitutional.

Under the SAVE plan, Biden plans to use an income driven repayment plan that will lead to full forgiveness within 10 to 20 years.

Why are Costs so Hight?

ad1893 — 2024-04-15 11:15:32 UTC

"The cost of college—and resulting debt—is higher in the United States than in almost all other wealthy countries, where higher education is often free or heavily subsidized. Meanwhile, U.S. states have pulled back funding for public universities and colleges in the wake of the Great Recession."

"Some education finance experts say the increase in federal student lending is making college less affordable for many by allowing institutions to artificially inflate tuition."

For-Profit and Private Schools

ad1893 — 2024-04-15 11:18:54 UTC

Private school graduates as well as those who attended for-profit schools generally owe more than students who attended public universities.

"A 2014 study found that federal aid led to tuition increases only at private, for-profit schools, though other research has established a link between aid and rising tuition at public schools as well."

Social Implications

ad1893 — 2024-04-15 11:21:51 UTC

Racial Disparities

ad1893 — 2024-04-15 11:24:24 UTC

"Black college students generally take on more debt than white students, and they are more likely to struggle with loan repayment after graduating, in part because they typically have lower levels of family wealth. Black, Latinx, and American Indian students are all more likely to default on their loans than white students."

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Barriers to Education

ad1893 — 2024-04-15 11:34:26 UTC

The high cost of education deters lower income students from attending university. Since those who hold a degree have a higher earnings potential, a perpetual cycle is created in which the lower class remains in the lower class while the upper and middle classes excel.

My Perspective

ad1893 — 2024-04-15 11:41:44 UTC

As a first generation college student that has benefited from government funding for education such as the Pell Grant, I can say that I understand the importance of such funding as I likely would not have been able to attend college without it. While such funding is something I believe is necessary, I don't necessary believe in blanket student loan forgiveness as there are many factors to be considered. Students need to look at the university they are attending. Is it out of state, is it private/public or for/non-profit, what degree will they plan on receiving, etc. These factors will all impact the amount they will pay or the debt they will take on as well as ensure that they will be able to receive a return on investment upon graduation. Funding needs to be available for low income or underrepresented communities, but I feel that the federal government also needs to focus on bringing tuition costs down. Providing aid while not addressing the issue of the high cost itself only leads to costs further increasing. Ultimately, I view education to be an investment in yourself. There are tangible benefits such as earnings after graduation but also intangible benefits that education offers. Regardless, I believe that the student holds some responsibility for ensuring that they are not taking out exorbitant amounts of debt to attend a 'dream school' without a plan to be able to pay it back. I also feel that the government is responsible for allowing tuition rates to skyrocket and that they also hold some responsibility to address the issue whether through grants or student loan forgiveness as long as they have a long term plan to bring costs down.