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Canceling Student Debt Is Just a Start. We Need to Do More.

The larger issue is the high and rising cost of higher education. There are ways to hold those costs down. An educated workforce is good for everybody.

A pink piece of paper stuck to the back of a person’s shirt that reads “President Biden: canceled student debt! Thank you!!!! Let’s Keep Fighting!!!”
Student loan borrowers rally in front of the White House on Aug. 25 to celebrate President Biden cancelling up to $20,000 in student debt and begin a campaign for cancellation of remaining debt from student loans.
(Paul Morigi/Getty Images for We the 45m/TNS)
President Biden acted wisely and compassionately when he announced last month that he was going to cancel up to $20,000 in individual federal student loan debt. Reducing student debt by any amount is a good start, but in and of itself the president’s action is not nearly enough. According to the White House and the U.S. Department of Education, 45 million borrowers owe $1.6 trillion in student debt. And according to U.S. News & World Report, tuition and fees at nationally ranked universities have risen by 134 percent over the last two decades. These problems must be tackled head-on by not only forgiving student debt but also reining in the uncontrolled cost of higher education. Government at all levels, including states and localities, can play an important role.

As both a parent and a former president of a state technical college in metropolitan Atlanta, I know about the problems of student debt firsthand. At the college, nearly three-quarters of the students received some form of financial aid, yet many still had to work full time to make ends meet. The pressure associated with having to work while pursuing a course of study adds stress to the lives of students that too often results in them dropping out of college. Students who fail to complete their studies still must repay their student loans. Biden’s loan forgiveness program would assist many of them, but some would still owe substantial amounts.

It gets no easier as parents trying to help their kids pay for college. My wife and I worked most of our lives in the public sector as educators and public officials. We did not have the resources to establish a savings fund for our two daughters’ education. They had to take out student loans. After they finished with their education — two bachelor’s and two master’s degrees later — they still owed hundreds of thousands of dollars.

These dilemmas faced by my daughters and former students are unfortunate, unnecessary and not in the interest of our nation remaining competitive with other leading countries. But instead of some members of the president’s opposition party (and a few within his own party) criticizing him, they should ask how they can help him do more. Some of these same critics remain silent as billions are spent on military aid to our allies each year, tens of billions in revenue are lost when profitable corporations pay little or no federal income tax, and billions of dollars in state and local tax revenues are forfeited when those governments forgive or abate taxes for wealthy corporations in the name of economic development and job creation.

When you see things like this happening, it becomes clear that it is not the money but who is being helped. It makes no sense to me why everyone would not want to help students and graduates get some relief from the oppression of educational debt.

Critics of the president have also participated in a game of divide and conquer that must stop. They attempt to pit the nation’s workers against college students by telling workers that they will bear the brunt of the cost of Biden’s loan forgiveness program. This is no truer than saying that workers disproportionately pay for aid to Ukraine or Israel. Our government sets the nation’s spending priorities. It is intellectually dishonest to suggest that the nation’s working class is bearing an unfair burden for Biden’s student debt cancellation initiative.

Instead of criticizing, the nation would be better served if public officials worked together to solve the problem. Here are some suggestions:

First, the federal government could stop awarding lucrative research grants to colleges and universities that continue to raise their tuition and fees beyond the inflation rate. Billions of dollars of sponsored research funding go each year to private universities like Duke, Emory, Harvard, the University of Chicago and Yale, along with public flagship universities. These and other institutions need to be held accountable for the rising cost of higher education.

Sherman Golden, an Atlanta attorney and a specialist in public finance, agrees and recommends that we restrict students wanting to take out student loans to schools that charge tuition at or below a certain level established by the federal government. “Over time, students would stop applying to schools with tuitions above the established levels due to their inability to secure the necessary loans, effectively forcing those institutions over time to adjust their costs to remain competitive or lose out on talented applicants,” Golden told me.

States could also freeze public-college tuition, perhaps for the next five years, to give families a chance to rebound from the lingering effects of COVID-19 and inflation. Additionally, states could devote more of their billions of dollars of revenue from parimutuel betting, lotteries, casino gambling and legalized sports betting to establish new educational scholarships and build up existing scholarship programs. Revenues from the state lottery Georgia approved in 1992 are used primarily for scholarships for students at both two-year and four-year colleges and tuition for early childhood education. Today 45 states have lotteries but not all use their revenues to fund education.

Finally, cities and states could establish an education fund from the fines that businesses pay for failing to meet job goals or other community benefits provisions after they have received tax abatements.

Higher-education scholarships might have to compete with other local needs, including pre-K-12 education, but both are worthy of greater public investment: Cities and states benefit from an educated workforce when better-paid residents buy homes, start businesses and pay taxes.

We live in an economy today where higher education, including technical training beyond high school, is imperative. Governments at all levels should do more to ensure that their constituents can get that education without being saddled with crippling debt. Biden has made an important first step. Now it is up to other public officials from both sides of the aisle to finish the job.

Governing's opinion columns reflect the views of their authors and not necessarily those of Governing's editors or management.
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