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For millions of Americans, President Joe Biden’s student loan cancellation offers a life-changing chance to escape the burden of debt. But for future generations of students, it doesn’t fix the underlying reason for the crisis: the rising cost of college.
The specter of heavy debt will still loom over current high school seniors – and everyone after them – since the debt cancellation only applies to those who took out federal student loans before July 1.
Among the main causes is rising college tuition: Today’s four-year universities charge an average of nearly $17,000 a year in tuition and mandatory fees, more than double the inflation-adjusted average from 30 years ago, according to federal data.
Biden’s failure to tackle the broader problem drew reproach from Republicans along with some of his fellow Democrats.
Sen. Catherine Cortez Masto, D-Nev., said the loan cancellation “doesn’t address the root problems that make college unaffordable.” Instead she called for expanded Pell Grants reserved for low-income students, and targeted forgiveness for borrowers in need. Other critics included Sen. Michael Bennet, D-Colo., who said the forgiveness should have been joined by action to address the “absurd” cost of college.
“We cannot continue to trap another generation of Americans in this cruel cycle,” Bennet said.
There’s no doubt that Biden’s debt forgiveness plan has a big upside for many Americans, if it survives the court challenges that are likely coming. More than 20 million will be eligible to get their federal student debt erased entirely, and 23 million more could get it reduced, the administration said. The plan cancels $10,000 per borrower and another $10,000 for Pell Grant recipients, for those who earn less than $125,000 a year or $250,000 per household.
Biden also extended a pandemic-era pause on federal student loan payments for what he called the “final time.” Payments are now expected to restart in January.
But without broader action, the nation’s federal student loan debt will return to today’s levels – $1.
