Former US Education Secretary John King has a bold proposal to accelerate the country’s economic recovery from theand putting millions on a better path to financial security: Forgive all the $1.7 trillion Americans still owe on their student loans.
King, who served under President Barack Obama, told CBS News that the federal government paid about 80% of the cost of college education for students through its Pell grant program in the 1980s. But the government’s decision over the past few decades to reduce its investment in higher education has left many students deeply in debt, with the current Pell program covering less than a third of scholarship recipients’ annual tuition.
“We must make up for this policy mistake of the past 40 years by addressing the crushing burden of student debt that so many young people feel today and solving the problem in the future by committing to a debt-free college in the United States. , “said the king.
More than 43 million Americans — nearly 13% of the U.S. population — have student debt, according to the St. Louis Federal Reserve. The average borrower owes about $37,000.
This debt anvil often weighs on borrowers for years, forcing them to postpone plans to buy a home, start a business or even have children, King said. Other prominent lawmakers, including Senators Elizabeth Warren and Chuck Schumer, have also urged the government to cancel student loans
The White House, dating back to 2020 under President Donald Trump, imposed an interest-free forbearance on student loan payments during the pandemic. As a result, since March 2020, nearly 37 million borrowers have been forgiven student loans, an estimated $195 billion worth of canceled payments, according to the New York Federal Reserve.
But the forbearance ends on May 1 and many borrowers are worried about being able to resume their payments.
Current Education Secretarythat Biden administration officials are discussing internally how to offer more student debt relief.
“We’ve definitely, from day one, put borrowers and students at the center of the conversation,” Cardona said. “In just one year, President Biden has already forgiven over $17 billion.”
In addition, the Department of Education hasfor thousands of former students at for-profit colleges after evidence showed their schools misled them into giving them loans.
It’s not enough to cancel past school loans, said King, who is now running for governor of Maryland. The US government must also ensure that future college graduates do not find themselves burdened with student debt, he said. Two ways to help this cause are to make community college free and to increase the amount each student receives in Pell grants, King said.