The fight in ending the damaging effects of the student debt crisis was almost in sight after President Joe Biden and his administration went forward with their student debt relief plan. However, on Nov. 14, a federal appeals court blocked the plan after a coalition of six Republican-led states asked the court to stop any debt cancellation amid its litigation.
At first glance, this is a big loss for many college students and families. The costs of higher education is one of the biggest challenges for anyone wanting to pursue it. In addition, many of us likely voted for President Biden specifically for his student debt plan and had high expectations for it to be carried out. Those in dire need of relief could use a clean slate.
However, in order to better approach the problem of student debt, it’s important to recognize the flaws in the administration’s plan. A pause on the relief plan provides an opportunity for a new solution that involves not just the federal government but the students and college institutions themselves.
The GOP-led states, Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina, in the lawsuit argued that Missouri had a necessary standing to block the relief plan involving their Missouri Higher Education Loan Authority — also known as MOHELA. They argued that if the plan had gone through, there would be a tremendous loss of revenue.
The debt cancellation plan was already temporarily blocked after a lawsuit, brought up by two borrowers from Texas who didn’t qualify for debt relief, deemed Biden’s plan unlawful. The judge argued that the decision regarding who’s eligible for the cancellation plan was made too quickly and also argued that it was an overstep of executive power.
Biden was able to proceed with a plan like this through the Higher Education Relief Opportunities for Students or HEROES Act. The 2003 law grants the Secretary of Education to alleviate student loans and debt that have been caused by a national emergency, which the administration cited as COVID-19. However, the judge disagreed and ruled the plan unconstitutional, setting up the case for the Supreme Court, to whom the administration appealed.
The Biden administration’s plan is not a horrific idea, despite what opposing sides may argue. First of all, the targeted debt relief will provide up to $20,000 dollars of relief for Pell Grant recipients and $10,000 for non-recipients. In order to be eligible, one must make less than $125,000. For those who won’t have their entire debt removed, the repayment for their loan is based on income, which ensures that debt is repaid equitably. Almost all borrowers won’t have to spend more than 5% of their income on their loans. Individuals who make $15 an hour or less as a single borrower won’t have to repay anything at all. This is a decent attempt to curb the cycle of student loan debt, since this serves the purpose of ensuring that loan balances don’t outgrow individuals as long as monthly payments are made.
It’s undeniable that the administration’s relief plan is a huge first step to helping those who struggle with student debt. However, the plan to wipe student debt is a short term solution as there needs to be preventative measures that help prevent student loans from being the only option to afford higher education. Lowering interest rates on loans is not enough. There needs to be improvements to the ridiculous cost of education itself. The fact that over 25 million Americans applied for aid like this is a problem in itself and needs to be addressed for future generations of students pursuing higher education.
Improvements to the federal loan system must be coupled with a decrease in the cost of higher education. It’s these increasing prices in higher education that institutionally trap students and families into debt. Universities are the third-largest source of lobbyists in Washington and continuously approve students for loans with nothing but a credit check to make them accept their high costs.
This predatory form of lending, that only benefits the schools, is what has led so many individuals and their families to be burdened with debt. A solution that stops this aggressive lending is essential for making college affordable for future generations of students. Biden’s relief plan currently helps families and students who have succumbed to their school’s sole option of loans. It seems necessary to include solutions that will make colleges more affordable serves to not only prevent schools from putting their students in debt but also end the student debt crisis.
President Biden’s student debt relief plan is an excellent step forward to helping the millions of Americans that are suffering the consequences of pursuing college. The Supreme Court should understand that and rule in favor of these individuals and not to the courts who have and continue to ignore those individuals’ needs.
America will require a more robust plan for the future of higher education costs in order to wipe student debt and create a clean slate. Such changes will pose less risk to those pursuing higher education and allow for college and universities to be more accessible to all.
Skylar Paxton is an Opinion Intern for the fall 2022 quarter. She can be reached at paxtons@uci.edu.