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Over the course of the Covid pandemic, we have seen one of the largest upward shifts of wealth in recent history. According to Forbes, there were 660 more billionaires in 2021 than the year before. At the same time, enrollment in community colleges and four-year universities plummeted in the United States, with the student debt crisis creating a situation in which low-income communities are hesitant to pursue higher education because of the likelihood of leaving with crippling debt.
In order to stop the student debt crisis and prevent future generations from being condemned to the reality that borrowers face today, we need to adopt a free college system. Such proposals already exist in both the House and Senate, with two of the most notable pieces of prior legislation being Senator Bernie Sanders and Representative Pramila Jayapal’s College for All Act, as well as Senator Brian Schatz and Representative Mark Pocan’s Debt-Free College Act. Such bills would allow for students to obtain a college education without fear of facing a lifetime of debt, while also helping communities that have been historically excluded.
The current budget reconciliation bill being considered by Congress includes two years of free community college, which would be a monumental first step in the fight for free higher education. The plan is a priority for President Biden who has pitched it as a critical component of his Build Back Better plan and sees free community college as part of his economic agenda domestically and abroad. On the campaign trail, Biden noted that “sixty-five out of 100 jobs today require more than a high school degree” and went on to warn that “any country that out-educates us will out-compete us.” According to the White House, the plan would allow nearly 6 million students and workers to earn a degree or credential for free.
However, this proposal is at risk as Senate Republicans and a handful of moderate Democrats threaten to pull the proposal from the package. Despite the fact that Senator Kyrsten Sinema of Arizona has previously said that “every American willing to work hard should be able to get a quality education through our country’s community college system,” she and Joe Manchin of West Virginia are the most notable holdouts.
Today, 45 million American student loan borrowers owe over $1.7 trillion in federal student loan debt, with the average borrower owing $37,000. While the student debt crisis is disastrous for all age ranges, it disproportionately impacts younger Americans, with one in three adults aged 25 to 34 having student loan debt. The impacts of the debt crisis prevent younger borrowers from purchasing homes, expanding their families, and saving for retirement. The average borrower takes 20 years to pay off their loans, with the average payment being $400 per month. Borrowers are being crushed by the student debt crisis—in order to solve it, we must address its root cause: the dramatically inflated cost of a college education.
Unlike most lawmakers, current students and recent graduates are all too familiar with the rising cost of a college education. From 1982 to 2012, the cost of tuition at private four-year college, for example, rose by 250 percent, and in the past 10 years alone it has risen by another 25 percent, with no indication that it will stop rising anytime soon. The University of California Board of Regents, for example, voted to begin increasing tuition for each new incoming class, leading to a 20 percent increase by 2026.
Previous generations of college attendees could pay for their education by working through college, but that is becoming increasingly difficult as the price of school increases eight times faster than wages. With 70 percent of students having to take out student loans to help pay for their education, the cost of college is condemning the majority of Americans to perpetual economic uncertainty and distress. Student debt also disproportionately impacts borrowers of color; 20 years after starting college, the median white borrower only has 6 percent of their debt remaining, while the median Black borrower has 95 percent of their debt intact.
“The exorbitant cost of higher education is fueling a system in which racial, gender, and generational wealth gaps continue to grow. In order to build an economy that will work for Millennials, Generation Z, and future generations of Americans, we need Congress to stop the student debt crisis at the source by passing free college legislation,” says Charlotte Hancock, senior director of Generation Progress.
Not only would student debt cancellation be one of the most impactful ways for us to build back better; it would also be one of the most meaningful policy paths toward a more equitable economy. As college costs soar and the student debt crisis gets worse, it is becoming clear that in order to fix our higher education system we must both provide free college for those seeking education as well as cancel the student debt of those who carry the burden created by our broken systems.