Why Student Debt Is So High and Why Forgiving It Doesn't Fix the Problem

Money For the Rest of Us

J. David Stein

Investing, Investing Podcast, Business, Economics, Economy

4.5 • 1.4K Ratings

🗓️ 14 September 2022

⏱️ 30 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

What are the drivers that lead to higher student loan balances? Why a one-time student loan forgiveness program doesn't solve the problem of increasing student debt. What are some more viable longer-term solutions.

Topics covered include:

How big is the Biden Administration student debt forgiveness plan
How big has the student debt burden grown
Why are borrowings for students increasing
Why Baby Boomers spent so much less on college
How are student loans accounted for by the U.S. federal government
What is the impact on the deficit and potentially inflation of forgiving billions of dollars of student debt

For more information on this episode click here.

Show Notes

Student Debt And The Federal Budget | How Student Loans Impact The U.S. Fiscal Outlook, November 2021—Bipartisan Policy Center

What the Student-Loan Debate Overlooks by Ronald Brownstein—The Atlantic

See the Average College Tuition in 2022-2023 by Emma Kerr and Sarah Wood—U.S. News & World Report

Biden’s Student-Debt Plan Could Chip Away at the Racial Wealth Gap by Sheelah Kolhatkar—The New Yorker

If your federal student loan payments are high compared to your income, you may want to repay your loans under an income-driven repayment plan—Federal Student Aid

What Does Student Debt Cancellation Mean for Federal Finances?—Committee for a Responsible Federal Budget

Government payments by program—Economic Research Service, U.S. Department of Agriculture

Projected Lifetime Earnings by Major by Douglas A. Webber, December 1st, 2019

Related Episodes

245: Is College Worth It?

307: Income Share Agreements—Good for Students or Investors?

327: Is Student Loan Forgiveness A Good Idea?

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Transcript

Click on a timestamp to play from that location

0:00.0	Welcome to Money for the Rest of Us.
0:03.5	This is a personal financial show on money.
0:06.4	How it works, how to invest it, and how to live without worrying about it.
0:10.4	I'm your host, David Stein, today's episode 402.
0:13.7	It's titled Why Student Loan Dead Is So High?
0:16.6	And why forgiving it doesn't fix the problem.
0:20.8	Last month, President Biden announced a plan to forgive some student loan debt via an executive
0:26.3	order.
0:27.3	At the same time, the administration announced the moratorium on making student loan payments
0:32.3	wouldn't.
0:33.3	The Biden administration intends to write off $20,000 of loans for individuals that took
0:39.1	out Pell grants and up to $10,000 for other borrowers who didn't take out Pell grants.
0:45.2	This is for borrowers whose income is less than $125,000 a year.
0:49.6	Currently, there's about $1.6 trillion of federal student loans outstanding in the US.
0:55.4	About 45.3 million individuals.
0:58.6	About 7 million individuals have student loans less than $5,000.
1:02.5	And another 7.5 million have student loans less than $10,000.
1:07.3	In other words, between $5,000 and $10,000.
1:10.0	Potentially then, 15 million individuals could see their student loans gone, assuming they
1:14.9	meet the income threshold.
1:17.1	There's been different estimates of how big this total forgiveness bill will be and it
1:21.4	depends on what percentage of students who qualify for forgiveness actually take advantage
	...

Please login to see the full transcript.

Previous episode | Next episode

Disclaimer: The podcast and artwork embedded on this page are from J. David Stein, and are the property of its owner and not affiliated with or endorsed by Tapesearch.

Generated transcripts are the property of J. David Stein and are distributed freely under the Fair Use doctrine. Transcripts generated by Tapesearch are not guaranteed to be accurate.