The Hillary Clinton Student Debt Plan: Good Start, Needs Some Tweaks

Healing the symptoms doesn't always affect the cause.

Yesterday, Hillary Clinton announced new additions to her college affordability plan, and while we’re thrilled that a presidential candidate is actually addressing young folks, this plan doesn’t really grasp the whole scope of the issue.

From the Clinton campaign website:

Today, Hillary Clinton is announcing that she will take immediate executive action to offer a three-month moratorium on student loan payments to all federal loan borrowers … With dedicated assistance from the Department of Education during this moratorium, borrowers will be able to consolidate their loans, sign up quickly and easily for income-based repayment plans, and take direct advantage of opportunities to reduce monthly interest payments and fees … Families with income up to $125,000 will pay no tuition at in-state public colleges and universities – covering more than 80 percent of all families.

That stuff is great. However, if you scroll down just a little bit further on the page you run into one tiny, yet all-to-important, sentence:

States will have to commit to a combination of reinvestment and reform over the next four years and beyond to ensure that federal support is funding students and not excessive cost growth.

So, none of this happens unless the states step up to the plate. Which, historically, they haven’t. Not to mention the fact that Clinton’s plan allows them to opt-out if they so choose.

Over the past decade we’ve seen dramatic decreases in state funding towards education across the board. So why, given the opportunity to just say, “We pass,” should we expect them to act any differently? For most states, declining the plan would be par for the course.

Even if the states were to cooperate, the meat of the issue is being left unaddressed. That moratorium is a band-aid on bullet wound. Yes, borrowers will be granted three months to save and refinance, but that doesn’t mean their job prospects are going to be any better when that period ends. With roughly one in eight people claiming they’re underemployed, paying the loans back remains problematic.

Again, the fact that our futures are even being considered is a pleasant change of pace. The point is that student debt relief is part of a bigger overhaul of the higher education system, and for any one plan to succeed it’ll require a deeper understanding of the problem at large.

 

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Cover image: Getty

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Posted 07.07.2016 - 02:58 pm EDT
http://www.genfkd.org/pokemon-go-makes-money-reality-boring

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Michael Gorman

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