Poor Student, oil on canvas, 1932 © Fred Gardner | Smithsonian American Art Museum
President Biden’s recent announcement that some amount of federal student debt for some qualified individuals will be forgiven is both an impressive first step—and an unsatisfactory long-term solution to a longstanding issue. Although Biden’s plan will undoubtedly change tens of thousands of Americans’ lives, it won’t solve a structural problem that is deeply entrenched.
When the White House announced its plan for federal student loan forgiveness, some Republican politicians and pundits went into a frenzy to criticize what they saw as a massive giveaway. Senator Ted Cruz made a particularly inflammatory statement, saying that “that slacker barista who wasted seven years in college studying completely useless things now has loans and can’t get a job.” Many of the blue-collar men and women Cruz praised on the campaign trail undoubtedly have student debt themselves, or, if not, many of their children do. It is also important to note that those with the least are getting the most help, as debtors who were eligible for a Pell Grant get $20,000 waived instead of $10,000. Instead of acknowledging how this plan will change many Americans’ lives across the country, conservatives tried to paint the picture of an urban, educated liberal getting financial help they did not deserve.
But there are also more serious criticisms. According to the Committee for a Responsible Federal Budget, federal student debt will return to its current level of $1.6 trillion in just over five years. Adjusted for inflation, it will return to its current high by 2031—in only nine years. Interestingly, the committee points out that the plan’s changes to income-driven repayment will almost certainly cause many borrowers to slow down paying back their loans, causing us to cross that threshold even sooner. So now, more than ever, it’s time for the American Left to keep making the case that Senator Bernie Sanders and the progressives have made—for taking socialism seriously, and enacting real structural changes in the economy.
As long as Biden’s plan survives the Supreme Court challenge that Senator Cruz and others have started anticipating, this is one of the few ways the president can help people affected by outrageous student debts in the immediate short-term. No one is holding their breath for the evenly split Senate to pass a plan that truly restructures how we fund our colleges and universities, which ought to include free tuition for public postsecondary institutions. But it’s politically feasible for the Democratic Party to make this move before the midterm elections and kick any real solution down the road.
It’s true that Biden shares some blame for the current student debt crisis, thanks to his role in leading the moderate Democrats in passing the 2005 “Bankruptcy Bill.” This bill imposed tighter restrictions to bankruptcy rules, making student debt almost impossible to discharge during the bankruptcy process. Biden enthusiastically championed this bill after taking hundreds of thousands of dollars from the many Delaware-based credit card companies. (The logic given for these changes was that interest rates would decrease if lenders were given more protections. But this never happened.)
But Biden’s action on student debt indicates that Americans may be ready to move on from the austerity politics that defined the Republican Party from Ronald Reagan to Donald Trump. Fewer and fewer Americans believe that “the top nine most terrifying words in the English language is ‘I’m from the government, and I’m here to help.’” On this particular issue, Americans are way more open to major structural overhauls in our college system than either party’s policy positions. According to the Pew Research Center, more than a third of Americans polled who consider themselves Republicans or lean Republican support making public colleges and universities tuition-free. Even Democrats who consider themselves moderate or conservative are overwhelmingly in support of such a sweeping change—at 81 percent of those polled.
At a time when every American has seen their government under both Trump and Biden hand out checks to everyone in the country and wipe out tens of thousands of dollars of debt for millions of people, it’s getting harder and harder to make the case for small government.
Jackson Todd is an MA candidate in Politics at The New School for Social Research.