The 2020 presidential race is heating up.
Here’s what some applicants are saying about your student loans.
Student Loan Debt Statistics
According to the last student loan debt statistics, there are over 44 million borrowers who collectively owe $1.5 trillion in student loan debt. Today, according to personal finance site Make Lemonade, student loan debt is now the second highest category of consumer debt — just after mortgages and higher than credit card debt and car loans. By 2023, 40% of student borrowers may default on their student loans.
Some of the 2020 presidential candidates have weighed in on the future of higher education, how to deal with growing student loan debt, and how to pay off student loans faster. While this list does not include every presidential candidate or every aspect of a candidate’s position on student loans, expect each of the candidates to release more in-depth policy proposals regarding student loans. as the campaign progresses.
Pete Buttigieg (D-IN)
Pete Buttigieg is the mayor of South Bend, Indiana.
Buttigieg thinks that:
- The cost of college should be lowered, but he doesn’t believe in free college.
- States should take a more active role in supporting student tuition.
- There should be no widespread cancellation of student loan debt, given the cost.
- There should be more talk about canceling student debt, refinancing student loans, and income-contingent repayment.
Kamala Harris (D-CA)
Kamala Harris is a United States Senator from California.
Harris thinks that:
- The college should be student debt free and supports the Debt Free Colleges Act.
- Student loan refinancing should be available from the federal government.
- Students should be protected from for-profit colleges that engage in predatory practices.
Kirsten Gillibrand (D-NY)
Kirsten Gillibrand is an American Senator from New York.
Gillibrand believes that:
Bernie Sanders (I-VT)
Bernie Sanders is a United States Senator from Vermont.
Sanders believes that:
- College should be free for some families earning less than $125,000 (College For All Act).
- Community college should be free for all students.
- Federal interest rates on student loans should be lower and the federal government should not make a profit on student loans.
- Student loan refinancing should be revamped to help save money for more borrowers.
Elizabeth Warren (D-MA)
Elizabeth Warren is a United States Senator from Massachusetts.
Warren thinks that:
- Student loan refinancing should be provided by the federal government.
- Civil service loan forgiveness should extend to all federal student loans, not just direct loans.
- The federal government should not make money on student loans.
- Taxes on the wealthy could be used to alleviate student debt.
Amy Klobuchar (D-MN)
Amy Klobuchar is a United States Senator from Minnesota.
Klobuchar thinks that:
- Pell grants should be expanded.
- Community college should be free.
- Borrowers should be able to refinance student loans through the federal government and enjoy a lower interest rate.
- Students should not have “free college” for four-year degrees.
Cory Booker (D-NJ)
Cory Booker is a United States Senator from New Jersey.
Booker believes that:
- A debt-free college degree and better access to college for low-income students are important goals for a revamped higher education system.
- Predatory student loan lending must be stopped.
- The Free Application for Federal Student Aid (FAFSA) form should be simplified.
- The cancellation of civil service loans, as well as the refinancing of student loans, should be extended to more borrowers.
Beto O’Rourke (D-TX)
Beto O’Rourke is a former US Congressman from Texas.
O’Rourke believes that:
- Civil service loan forgiveness should be expanded, and those who serve their community after college should have access to student loan forgiveness and perhaps not have to borrow student debt.
- At a minimum, the first two years of a state or community college should be free for students.
- Federal student loan interest rates — and the cost of college education — should be more affordable.
Andrew Yang (D-NY)
Andrew Yang is an entrepreneur from New York.
Yang thinks that:
- A 10×10 student loan emancipation plan should provide student loan forgiveness to anyone who spends 10% of their salary for 10 years on repayment.
- Vocational training must be broadened and de-stigmatized.
- Universities should implement an administrator/student ratio.
President Donald Trump
President Trump released his 2020 budget and his vision for higher education. In his proposal, Trump called for several goals, including:
- balancing the needs of students with the interests of taxpayers
- ensure budgetary discipline in the expenses
- reduce the role of the federal government in education
- reduce student loan debt
- increasing the accountability of higher education institutions
- make higher education more affordable
- invest in technical and vocational education
Specifically, Trump proposed that:
- The Civil Service Loan Forgiveness Program is expected to be scrapped, impacting borrowers who take out a new student loan after July 1, 2020.
- There should be only one income-based student loan repayment plan.
- Student loan forgiveness should be available to all undergraduate and graduate student loan borrowers who participate in the single income-driven repayment plan. Borrowers would pay 12.5% of their discretionary income and receive student loan forgiveness on their federal undergraduate student loans after 15 years and receive student loan forgiveness on their federal graduate student loans after 25 years.
There are several key questions candidates, legislators, policymakers, voters, and political observers should consider as these student loan proposals become more comprehensive:
- What is the role of the federal government when it comes to granting student loans?
- What is the role of the private sector, including banks and other financial institutions, in providing federal student loans?
- Given the amount of student loans in arrears, will the federal government start guaranteeing federal student loans?
- How will the federal government afford to refinance student loans?
- Should Federal Taxpayers Pay Federal Student Loan Forgiveness Through the Civil Service Loan Forgiveness Program, Income-Based Repayment Programs, and Similar Programs?
- Should college be a “debt-free” student loan and how would the cost be funded?
- Should college be free and how would the cost be funded?
- What is the right balance between the interests of students and those of taxpayers when it comes to student loans?
Lots more to come as new proposals are announced and debated, so stay tuned.