Hello friends! I just want to remind you all that there exists a Politics Forum where we can be a bit more free about expressing disagreement. This is an important topic for all visitors to CC, so I want to keep this topic open. Please avoid debate here!
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Itâs unexpected in the sense that people werenât expecting follow-through, but Biden said heâd do this nearly 2 1/2 years ago.
This proposal would be in addition to my existing student debt proposals:
- Immediately cancel a minimum of $10,000 of student debt per person, as proposed by Senator Warren in the midst of the coronavirus crisis.
- Those earning less than $25,000 per year will not have to make monthly payments and will accrue no interest
- Those earning more than $25,000 per year will pay no more than 5% of discretionary income toward payments
- After 20 years, the remainder of federal student loans will be forgiven without any tax burden
- Those who participate in public service will be eligible for additional federal loan forgiveness, including $10,000 per year of forgiveness for up to five years.
1/3 of people with loans will have $0.00 left to pay 2/3 will have half their loans left to pay⊠Something is better then nothing. No incuring interest and payments will be 5% of monthly income. These last two is big. $20,000 for Pell Grant people.
My loans were forebeared so many times I lost count. Had no choice. The incuring interest was a killer. It was like a penalty to take out loans and trying to get ahead.At least peopleâs loans wonât double due to it.
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I agree that this is an important topic to discuss, and I hope that we can focus on the facts.
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Nope, you borrow it you owe it. No justification for this beyond vote buying and wealth redistribution from the bottom to the top. Unemployment is at a record low. The labor market is hot, employers canât hire enough people but students canât afford their loan payments? Canât have it both ways.
Another interesting comment I read earlier today:
âOne last thought on this - the student loan program got taken over by the federal government under NANCY PELOSI as part of OBAMACARE. Because they used the âprofitsâ it would generate to write down the true cost of Obamacare.
From The Hill, in May of 2013:
"Recent speeches by Tennessee Republican Sen. Lamar Alexander highlight a connection that has yet to be reported in the media and is yet to be understood by the young people struggling with high interest rates in the hopes of financing their college education.
According to the Congressional Budget Office, $8.7 billion of the money collected in student loan interest payments actually goes to pay for ObamaCare. The CBO estimates that the interest rate on these loans could be reduced from 6.8 percent to only 5.3 percent were the funds not used to subsidize the healthcare reform law and other federal programs."
Wonder if thatâs still happening? Didnât seem to work as promisedâŠâŠ
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I was wondering if people would support my 27 year old plumber receiving similar debt relief?
Rather than taking out loans to attend CC, he worked an apprenticeship, than borrowed money to buy his own truck and then went into further debt to buy his own Roto Rooter franchise. He had been paying taxes and loan payments for the last 9 years and now employees 2 people.
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Regarding the 20k for Pell recipient eligibility. If a student had full Pell eligibility in UG but no student debt, will that student be able to get the 20k forgiveness towards their federal med school loans, or would the student only qualify for 10k because the student loans werenât taken in the years they received the Pell grants?
Seems like it would be best to split off the political advocacy posts into a thread in the politics section, while keeping this thread purely for talk about what it actually is, who is eligible, etcâŠ
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This is one of the things we have to wait to find out. My suspicion is that the grad/professional federal loans will qualify, but thatâs just a guess.
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Any guesses as to how they came up with the income limits?
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And I can cite sources that dispute The Hillâs reporting. We could have a thread where people argue back and forth about the politics of this, but that really belongs on a separate (political) thread.
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Contacting your congressional reps is a good place to start if youâre curious about this, but yes, Iâd imagine many people would be in support - assuming a candidate runs on the issue or there is a grassroots initiative about it.
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In the words of Jerry SeinfeldâŠ
Been a while since I took Econ but funding debt elimination through government spending seems inflationary. Then again I thought a recession was two quarters of negative GDP, combined with declining consumer sentiment.
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And will those receiving debt forgiveness owe the requisite taxes for their windfall?
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Agreed but this is fundamentally a political decision.
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I had $350,000 loans between my wife and I. With forbearance forever. We paid every last penny plus.
I am happy that some wonât have it as hard as we did. This is a boost and help to people. Not a bad thing. Plus repayments will be 5% not 10% of income. This will help many people to get ahead. Again, not a bad thing.
Some people will say itâs unfair since they didnât go to school etc. But this is only addressing those that did go to school.
Biden also is pushing for free community College for 2 years at least. There is more to the bill.
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I did not read it that way. I read it as IF your 5% repayment doesnât cover all the interest accruing, the government would cover the rest, so someone making a 5% payment may be paying only interest and not principal, but that the balance wouldnât be growing. THAT is a big difference as the new plan would forgive the balance after 10 years.
To be fair, I think we could do something for such people. Perhaps a trophy to reward them for their outstanding financial acumen, or their names on a plaque.
It only benefits those who took out student loans. It burdens all federal income tax payers.
There is no bill. This is an executive order dictated by Biden not a bill debated and passed by congress.
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Kind of like when my tax dollars go to to help victims of hurricanes Florida and Texas, tornadoes in the midwest or wildfires in the westâŠwhereâs my trophy for choosing to live somewhere that doesnât have those perils?
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