Biden admin is delaying the release of its proposal—expected this month—to lower monthly payments for federal student loan borrowers via a new income-driven repayment plan.
But Ed Dept officials say they’re still on track for it to go live next summer:
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Jason Delisle
@delislealleges
Senior policy fellow . Higher ed finance, student debt, federal budget. Former fellow, , congressional staff. Views here=my own.
Washington, D.C.Joined April 2014
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The says the payment pause has cost the government $100 billion as of May 2022. cbo.gov/system/files?f
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The logic behind not paying student loans is getting pretty wild. If by "hurt financially" they mean "cost" then, well, this is false.
actionnetwork.org/forms/cant-pay
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Looked up the likely source for this. Median payment is $222. The *average* is $393. If I were to describe the "average student loan borrower," I'd go with the median here, $222. federalreserve.gov/publications/2
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In less than 50 days, the average student loan borrower will face a $400/month payment again.
We can’t let this happen. It’s time to cancel student debt and relieve this burden.
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The Surprising Role of High-income Families in Student Debt Trends: Examining Undergraduate Borrowing by Income, 1995–96 to 2015–16 aei.org/research-produ via
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Folks.Let me be clear.The wealthy do not take out student loans. I’m now a professional with student loans and it’s bc I grew up in poverty and worked my way out.Nothing , including education was “handed”to me. Everyone deserves the opportunity to succeed without student debt
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Consumer price inflation has cut the amount undergraduates can borrow in the federal loan program by 22% and counting. Our new report aims to help policymakers decide whether and how to respond.
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This was surprising. The share of undergrads taking out the max federal loan hasn't grown since the mid 2000s and remains at just 16%. Not what I expected given the student debt crisis narrative and the separate "student loans are driving up college prices" narrative.
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Someone has to say it. Federal student loan limits for undergraduates are shrinking... faster now with high inflation. From our new report on the effects of inflation on the purchasing power of student loans. cc urban.org/sites/default/
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Report is now live. urban.org/sites/default/
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Here's the link. Report is now live. urban.org/sites/default/
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With inflation raging, is there a case for Congress to raise limits on undergraduate student loans? Limits haven't budged since 2008 and the purchasing power is eroding rapidly now. @kblagg and I have a report coming out on this soon. Stay tuned.
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With inflation raging, is there a case for Congress to raise limits on undergraduate student loans? Limits haven't budged since 2008 and the purchasing power is eroding rapidly now. and I have a report coming out on this soon. Stay tuned.
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Congress has been unwilling/unable to define & police bad outcomes at all colleges broadly. Ditto for Obama, Trump & Biden admins. So they outsource to a third party what has so far been a politically impossible job, and yup, the third party won't do the job for the same reasons.
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My latest @NewYorkSun highlights @sleschly study showing that accreditors truly are watch dogs that don't bite when talking poor student outcomes. @arneduncan
So much so that the advice to pick an accredited school to protect yourself is bad advice
nysun.com/article/the-ac
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I’ll remember this the next time someone asks why the student loan program doesn’t just seamlessly, frictionlessly and automatically access borrowers’ income information in real time whenever needed.
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At the IRS in Austin, cafeteria is overrun with paper returns awaiting processing by campus’s dedicated employees who will *keystroke* line items into the IRS’s database
Investing in the IRS essential to overhaul this manual system, so agency can serve taxpayers way they deserve
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This paper has stats on how long borrowers are in default and how long it takes to most to exit. aei.org/wp-content/upl
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A student loan forgiveness idea: Loans that have been in default for 10 years or longer are forgiven. Make it retroactive + prospective. If the feds can't collect in 10 years w/ all their tools & borrowers can't/won't pay by then, it's in everyone's interest to call it even.
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New report by + . Students at public 4yr colleges that set "higher living allowance[s] for reasons not explained by local living costs and student living arrangements are predicted to borrow 40% more..."
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Join us at 4pm TODAY at (L'Enfant Plaza and online) for a discussion of Sandy Baum & Mike McPherson's new book, moderated by .
Reception to follow!
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Though there's interest in accountability policies to curb high-debt/low-earning grad programs, the fact that these degrees are concentrated at private non-profit institutions and in fields like social work & mental health counseling is going to create headwinds for reform.
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Nearly 1 in 5 master's degrees offered at private non-profit institutions result in unaffordable student debt, and the Income-Driven Repayment program papers over the issue. Will policymakers act to rein this in?
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Which master's degree programs weigh down students with high debt relative to their earnings?
Turns out private nonprofits are the biggest offenders.
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Debt levels for students who earn these degrees are substantially lower at public universities, but earnings are nearly identical. Why are debts/prices at private nonprofits so much higher for these degrees than at publics?
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3 types of masters programs account for about 1/2 of the high debt/earning ratio programs: social work; clinical, counseling, applied psychology; mental & social health services. Education/teaching isn't in this group. Theater, film, journalism are in there, but small.
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Our latest blog post looks at master's degrees with the highest debt/earnings ratios. It's largely a non-profit problem, and just three types of degrees make up nearly half of these programs. urban.org/urban-wire/hig cc
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Getting a strong, "college pays off, students loans are worth it and work" vibe from these conservatives -- in the to boot. The plot thickens in the right-left student loan debates.
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President Biden is reportedly planning to dampen any inflationary impact of student loan forgiveness by tying it to the payment restart.
I argue that coupling these policies makes sense but that Biden should consider going one step further:
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More first-ever data on the Public Service Loan Forgiveness (#PSLF) program from a new document provided to the
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A program for teachers and firefighters yes… but apparently many highly paid professions too.
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Who benefits from PSLF loan forgiveness? It’s not who you think.
Nearly a third of borrowers receiving student debt forgiveness through PSLF have incomes above $100,000—a larger share than borrowers earning $50,000 or less. #ELRFacts
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Never seen this info before. Income of those who received Public Service Loan Forgiveness. Lot of borrowers earning over $100,000.
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Who benefits from PSLF loan forgiveness? It’s not who you think.
Nearly a third of borrowers receiving student debt forgiveness through PSLF have incomes above $100,000—a larger share than borrowers earning $50,000 or less. #ELRFacts
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The just published the latest tally through May 2022 for the student loan payment pause. $112.8 billion cost and counting. cbo.gov/system/files/2
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In truth, if the author read the whole Return to learn site, she would have seen 5 states already rebounded past their 2019-20 enrollments.
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The problem with arguing for student loan forgiveness b/c the government bailed out banks in 2008/9 is that the government bailed them out with... loans. They gave the banks low interest government *loans* and the banks repaid them.
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If you believe a recent med or law school grad is worse off economically than someone with just a high school diploma then this view of the world is for you. via @NYTOpinion nytimes.com/2022/05/17/opi
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"Set up some sort of application process" for loan forgiveness. The track record on administered applications for student loan forgiveness has been, um, slipshod. Will this time be different?
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Ed Dept officials have told WH they would need to set up some sort of application process to determine whether borrowers qualify for relief if there’s an income test.
Ed Dept planning for various options based on what WH decides.
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New York's free college program has been hyper rationed with eligibility rules and involves massive paperwork (3 annual forms and a yearly contract). A new brief finds very low take up rates.
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Back in the 1970s, Congress expanded access to interest-free student loans and volume surged -- a big reason was the rate was far below inflation so everyone took out loans. Important lesson for today's debate about making student loans interest free. cbo.gov/sites/default/
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Made this quickly for context for the resetting student loan interest rates today.
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This is from 2012, but provides the history of how interest rates are set on federal student loans, for those writing about resetting interest rates today. files.eric.ed.gov/fulltext/ED540
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