Before condemning student loan forgiveness, remember how much higher education matters, and costs: Eric Foster

ATLANTA — It is hard to overstate the importance of getting an education. A simple Google search reveals various quotes from luminaries of all stripes and colors, from times past and present, from Nobel peace prize winners to US presidents, all proclaiming the value of an education.

“Education is the most powerful weapon which you can use to change the world.” – Nelson Mandela

“An investment, in knowledge, always pays the best interest.” -Benjamin Franklin

“Upon the subject of education, … I can only say that I see it as the most important subject which we as people can be engaged in.” – Abraham Lincoln

“Knowledge is in every country the surest basis of public happiness.” – George Washington

For generations, we have exalted education as the surest way to pull yourself up by one’s bootstraps and change the trajectory of one’s life for the better. If you want to change your circumstances, or the world, as Mr. Mandela suggests, the best way to do that is by going to school. To put it simply, getting an education is a good thing.

But what is often left out of exhortations about getting an education is the cost.

”In 1980, the price to attend a four-year college full-time was $10,231 annually — including tuition, fees, room and board, and adjusted for inflation — according to the National Center for Education Statistics,” Forbes magazine reported earlier this year . “By 2019-20, the total price increased to $28,775. That’s a 180% increase.”

There are several theories offered for why the cost has increased exponentially, such as reduced state and local funding for public institutions, increased staff costs, and simple market competition, but I will leave that to the scholars and economists. What matters most here is that a college education was previously something that could be paid for if you worked a summer job or worked while you were in school. For some time now, that is no longer the reality.

Despite the ever-increasing cost of higher education, many Americans still recognize its value. A recent survey conducted by New America, a nonpartisan think tank, found that 30% of Americans believe that a bachelor’s degree is the minimum level of education that immediate and close family members need “to ensure financial security.” If you include all postsecondary degrees (associate’s, master’s, and doctoral), 55% of Americans believe that a postsecondary degree is the minimum level of education that an immediate or close family member would need to ensure financial security.

The question, then, for that 55% of Americans is, how do you pay to achieve the thing that will give you (or your loved ones) financial security? Most Americans cannot afford to pay roughly $30,000 per year out-of-pocket for a bachelor’s degree. Associate degrees aren’t as cheap as you may think, either. They average around $10,950 annually at a public institution and $28,627 at a private institution.

Most people resort to taking out loans. In April 2019, the Institute for College Access & Success found that 69% of all students who graduated with a bachelor’s degree in 2016 had student loan debt. The average amount owed was $29,650.

Consider, then, what kind of market those students are graduating into with almost $30,000 in debt. According to the National Association of Colleges and Employers, the average college graduate starting salary is around $55,260. Assuming an average US tax rate for a single working person of 22.6%, that would mean a take-home salary of $42,771.24.

The average rent nationally for a one-bedroom unit is about $1,770 per month. What that means is the average college student, making the average salary, and renting the average one-bedroom unit, would be spending almost half of his or her after-tax income on rent alone. If you add in grocery costs, phone bills, transportation costs, you can see how the average college student might not have much left over to repay $30,000. Or more specifically, $30,000 plus interest.

I understand being upset about student loan forgiveness. It is not unreasonable to claim what President Joe Biden did was unfair. It certainly feels unfair when you see the government taking action to address the problems of others when you have your own very real problems that you would like the government to address. We all pay taxes. What makes their problems more important than mine? If you don’t have any student loans (roughly 80% of Americans don’t), I don’t blame you for feeling that way.

I can also understand being upset if you paid off your student loans. You likely sacrificed many wants, desires, and possibly other needs, to pay your debt. And you likely did so over a period of time, requiring continued diligence and commitment. If you persisted through that ordeal, I can see how it feels unfair when others get that same debt erased with the stroke of a pen. It feels like your sacrifices were worth nothing; unnecessary even. Apparently, all you really had to do was wait.

I understand the feeling, but I want you to take a step back for a second. Remember, your fellow Americans who took out loans did so in an effort to do something that our society encourages them to do: get an education. We encourage people to get an education because it helps our society as a whole.

A degree is essentially a requirement for elected office. Ninety-six percent of the members of Congress have a college education. We haven’t had a president without a college degree since 1953. Those with college degrees are more than twice as likely to volunteer and contribute more money to charity. Per a 2015 Lumina Foundation study, over a lifetime, bachelor’s degree holders contribute $381,000 more in taxes than they receive in benefits. By contrast, a high school grad contributes just $26,000 more.

Accordingly, we must move beyond the divisive framing of the student loan forgiveness conversation. Certain individuals are hell-bent on framing this in an “us versus them” kind of way. College graduates versus non-college graduates. Plumbers versus doctors and lawyers.

It is not college graduates versus non-college graduates. Plenty of non-college graduates have outstanding student loans. Up to 32.9% of undergraduates do not complete their degree program.

People drop out for a variety of reasons, from inability to pay to life events. I had a classmate drop out of college after he lost a parent on Sept. 11. I contemplated dropping out of law school when my daughter was born. Regardless of the reason for dropping out, those loans still come due.

It is not plumbers versus doctors and lawyers. Plumbers have student loans, too. The average cost of vocational school is roughly $33,000. While this is considerably less than the average cost of college, it is not a sum which many are able to finance personally. Students who attend trade school graduate with an average of $10,000 of debt. Surely tradespeople want their student loans forgiven, as well.

It is fair to argue that wealthy individuals should not have their student loans forgiven. I think most people can agree with that. But Biden sought to address that concern by capping those who qualify at an annual income of $125,000 individually and $250,000 for married couples. You can argue that the caps should have been lower, but the point is that your concern was heard and validated. Others strenuously argued for no cap at all.

The reality is that many people struggle to repay their student loan debt or have put off life events such as home-buying or marriage or having children because of student loan debt. It’s not the majority of Americans, but it’s a fair number. Biden took a step to help those people.

Eric Foster is a columnist for The Plain Dealer and cleveland.com.

Every American does not benefit from every governmental program. The vast majority of Americans do not own a business, yet their taxes helped subsidize the Paycheck Protection Program during the pandemic. The taxes of the approximately one-third of Americans who do not own a home help subsidize the mortgage interest deduction that homeowners can receive. The idea is that these programs help specific groups of people, which will, in turn, benefit the public at large. You can argue that student loan forgiveness does not help the public at large, but you should be able to see that a reasonable argument can be made that it does.

Some say that, instead of student loan forgiveness, we should be addressing college affordability. This argument presents a false choice. Nothing says that we cannot address the underlying issue as well as its current effects. When a doctor diagnoses someone with a medical problem, a bad back, for example, the doctor will prescribe treatment for the underlying issues (surgery, perhaps) as well as the symptoms of the issue (ibuprofen for back pain). Why can’t we do that same thing here?

Addressing college affordability is a huge task. As I noted earlier, the rapidly rising cost of higher education has many causes, all of which should be examined. But as the saying goes, if you want to eat an elephant, you start with the trunk. Student loan forgiveness is that trunk.

Eric Foster, a community member of the editorial board, is a columnist for The Plain Dealer and cleveland.com. Foster is a lawyer in private practice. The views expressed are his own.

To reach Eric Foster: [email protected]

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