re: When do the DEMs/Biden get serious about some Student Loan Forgiveness?

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Make universities have skin in the game by forcing them to co-sign on all loans, or even better, be the bank themselves and loan money to their own students.

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They could even just underwrite a portion of the loan. Even if you made them responsible for 10%, it would radically change how they do business.

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You realize that people with medical degrees, engineering degrees, and other very useful degrees...(useful not just for them personally, but for our society) who graduate with hundreds of thousands in loans.

I know several physicians who have over 200k in loan debt.

JMO but we should offer loan forgiveness on a graduated scale. Base it on how much your degree benefits America - if we need more folks in that field, then more loan forgiveness. If we don't need anyone in that field, then no loan forgiveness.

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Most medical debt is from federal loans. Most of them have two distinct pathways to forgiveness already- 120 qualified payments under an income-based repayment plan after consolidation through fed loan while working for a 501c3 . This forgiveness is tax-free
The other is something similar but requires you to qualify for hardship, pay a specific amount/percentage of discretionary, not miss payments, and hit the 20 or 25 year mark and still owe. This gets you a gift that is taxable.


If you don't choose one of these paths, you are on the hook for what you took. $200K in debt isn't that bad when you make $200K or more a year, and I certainly expected to pay it back.


Personal touch: Wife and I combined around $300K in debt upon graduation from residency in 2018 (just from undergrad, medical school). This is on the leaner side of debt for two docs. She had a bit of help from her parents. As it sits, we will be debt free in about 7 months.


Other interesting point:
You can usually deduct student loan interest from taxable income, but most doctors (who it would benefit the most) phase out of it at essentially any "normal" doctor income.


I don't think offering big rewards to the highly-compensated is a particularly useful exercise when it's very easy for those people to live within their means and stick to the terms they have agreed to.

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I don't know how you do this in all areas. I know plenty of attorneys who make 300K plus a year. I know plenty of attorneys who make 70K a year working on their own or working for government.

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It’s not that hard. Don’t over complicate it.

Completely unrelated, the amount of money a student can take out is pretty limited if the parents make any kind of money at all. Our daughter could only take $27k maximum for her four years in Stafford loans.

In other words, the students least likely to understand the ramifications of taking out $100k in debt for a kinesiology degree are the most likely to get into massive debt.

Secondly, there’s no responsibility from the school. A friend of mine had a daughter going to school to try to go to PT school. PT school is incredibly competitive and she was floundering through her undergrad. At what point should her college have said “Uh, yeah. No. You’re not going to PT school. What’s your next choice?”

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The tool is obviously not fine since it has caused tuition to skyrocket past inflation. In fact, the two areas of the private sector that the government is most involved with - education and medicine - just so happen to be the ones with the greatest increase in costs. That is not a coincidence.

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I would argue that's due to misuse of the tool as opposed to the tool itself. Thus, the solution should be different.

If you use a hammer to try to beat a screw into the wall, the problem isn't a design flaw of the hammer, or the existence of the hammer.

Clearly the system is broken.

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My plan would cause the schools to not allow debt to be used to take courses everyone knows are useless. Right now they are happy to do so because they have nothing to lose. In fact most MANDATE a healthy dose of useless courses no matter the w degree pursued.

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You will never get "everyone" to agree they are useless.

We are dealing with this right now in the CPA profession. The CPA exam is being rebuilt and as such we need colleges to somewhat change their accounting education programs. The exam is being rebuilt because the world is changing and young CPAs need a somewhat altered skill set compared to what was needed decades ago.

Yet, the accounting professor community is fighting tooth and nail to not change. Even those most of them have not been in public practice for decades, if they ever were.

If the CPA community is struggling to convince accounting professors as to what classes are important, having all of society agree on what total classes are important for all majors is going to be even harder.

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Even the universities themselves know that many of their courses and majors have no economic value whatsoever. They know it because the data says so, not because people feel it is so. Those courses are offered because they believe they offer some value other than economic, which is probably true for the most part.

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There are many college administrators who still believe college should be about enlightenment and education, more so than job skill development.

These people have no concept of economics or economic value.

You have to fix that problem before you can expect them to not allow student loans for courses of little to no economic value.

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the only reason something hasn't happened yet is they want this bullet in the chamber for emergencies.

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I think they realized Biden doesn’t have the authority to do it via an EO and the courts would strike it down if he tried that route…and that they wouldn’t have all 50 Dem senators onboard to get it through Congress. So they aren’t talking about it because they hope most people will forget all the campaign promises about forgiving student loan debt