Recent data obtained best payday loans Beaver Falls PA by the National Consumer Law Center showed only 32 individuals have actually received loan forgiveness since the launch of the first income-driven repayment plan in 1995. The policy and advocacy organization estimates that approximately 2 million borrowers have been in repayment for at least 20 years under the various income-driven repayment plans.

Akers also argues that widespread cancellation would offer “a lot of benefits to people who are already doing quite well in this economy.”

Brookings analysis of Federal Reserve data showed households with master’s, professional or doctoral degrees owe 56% of the nation’s student debt. Their median household earnings are approximately $72,000, $111,000 and $101,000, respectively, according to 2019 U.S. Census Bureau data.

Additionally, critics like Alexander Holt, a policy analyst at the Committee for a Responsible Federal Budget, make the case that blanket cancellation of student debt would present a “moral hazard” and is “not a good use of taxpayer dollars.”

“There’s a cost to forgiveness. It depends on the cancellation policy being proposed, but it’s either hundreds of billions of dollars or up to a trillion dollars,” Holt said. “That cost adds to the federal debt. So ultimately, taxpayers are responsible for the federal debt.”

He added, “If we were to cancel student loans, we are basically making a decision to provide relief now and have some future generation pay for it later. “

The same goes with the companies that service or hold federal student loans

Holt said lawmakers should be considering policies that “help people at the lower end of the income spectrum, especially now” during the pandemic. “Those tend to be the people who didn’t go to college, who didn’t take out any debt,” Holt said, and they make up a majority of the U.S. population. Statistics from the U.S. Census Bureau show 64% of people over the age of 25 do not have a bachelor’s degree or higher.

“No silver bullet”

While payments of federal student loans are currently suspended due to COVID-19 emergency relief measures, and the interest rate is at 0% until at least , outstanding student debt still looms over about 1 in 8 Americans.

“There’s no silver bullet for a $1.7 trillion crisis,” Frotman said, adding that the issue needs to be tackled “from all angles.”

“We need to enhance the consumer protections, so student loan borrowers are no longer second-class citizens being forced to deal with abuses that people with a mortgage or credit card don’t have to face,” Frotman said. “We need to improve the Department of Education to ensure that they’re actually doing a much better job overseeing these programs. We have to make college more affordable for the next generation, so we’re not just dealing with this in another five years. On the table needs to be reducing, canceling debt for millions of people across this country who have been held back because of it.”

“To strengthen this country and our global competitiveness, we must ensure that students can enroll and graduate from college without the fear of lifelong debt all students deserve access to a high-quality, affordable education that equips them with the skills to succeed. To fulfill that goal, the Department of Education must act to protect students from institutions that take advantage of their postsecondary investments – particularly when it is financed with federal financial aid. Borrowers deserve world-class service that makes it easier for them to manage their benefits. When they do not, there must be consequences. The fact that students of color are disproportionately likely to have student loans or have attended colleges with credible accusations of misconduct further highlights the importance of strong protection.