Some Oregon students say Biden’s loan forgiveness doesn’t go far enough
President Joe Biden announced a one-time write-off of some federal student loan debt on Wednesday. The new policy wipes out up to $20,000 for people who went to college on Pell Grants and $10,000 for those who didn’t, only if they earn less than $125,000 a year.
Some Oregon students appreciate the move, but think the president could have gone further.
According to data for the 2019-2020 academic year from the Oregon Higher Education Coordinating Commission, or HECC, individuals who earned an associate’s or bachelor’s degree from Oregon’s public universities on average about $21,000 in federal debt. At community colleges, former students owe about $13,000 on their federal loans. Overall, 31% of Oregon undergraduates have federal loans, according to Oregon HECC.
“I am thrilled with the mobility and relief this decision will bring to student debt holders in Oregon and across the country,” said Luda Isakharov, student body president at the University of Oregon, in a statement. communicated to the OPB. “However, a one-time cancellation is the bare minimum to meet the skyrocketing costs of a college education.”
Isakharov is from Oregon, and she said she chose to go to OU because the tuition in the state made it more affordable.
“But a lot of my friends and peers come to Oregon for out-of-state programs, and the costs are extremely heavy, and as a result, they have to take out extremely large loans,” she said. “I just wish we could all choose our college, universities, and educational paths based on our passions and what’s best for us and not be constrained by onerous costs.”
Student leaders at Oregon State University, Oregon’s largest public university, had a similar mixed reaction to Biden’s announcement. Oregon State University Student Associates said in a statement from their executive branch that while the partial loan forgiveness will benefit many students, it is not a permanent solution.
“While we seek greater action from the federal government on the student debt crisis, we are pleased to hear that action is being taken,” the ASOSU executive branch wrote. “We hope this will represent a first step towards longer-term actions to tackle the dramatic rise in the costs of higher education.”
Oregon politicians reacted positively to Biden’s announcement on Wednesday.
Rep. Suzanne Bonamici, D-Ore., and U.S. Sens. Ron Wyden and Jeff Merkley, both Democrats, released statements Wednesday morning supporting the president’s action.
Bonamici called the announcement “the most ambitious in a long list of actions the Biden administration has taken to support student borrowers, reform the federal student loan system, and make our country’s colleges and universities more affordable.”
Wyden tweeted that the one-time loan forgiveness is great news for students who are forced to make decisions between paying off their loans and making ends meet. He said he would continue to push for student debt relief in the future.
Merkley said he applauded the action but saw it as a “down payment” on the overall solution. He says he will pursue bigger reforms, including affordable, income-tested repayment plans.
As enrollment has plummeted at most Oregon public higher education institutions during the pandemic, tuition has increased. The rising cost of higher education has made it even more difficult for students to graduate without taking on substantial debt.
The Oregon Student Association, a nonprofit student advocacy group, said while Biden’s partial debt forgiveness is a step toward solving the “broken higher education system,” there is still a lot to do.
“Public higher education continues to be significantly underfunded, forcing students to shoulder the burden of high tuition fees,” the OSA executive committee told the OPB in a statement. “We urge President Biden to expand financial aid, fully fund higher education, and cancel all student debt.”
OU Student Body President Isakharov said she hopes Biden’s announcement will start a broader conversation about college access and affordability.
“The loan forgiveness is an incredible step, but I want to know what’s next — both from the federal government, but also from the state of Oregon,” Isakharov said. “The systemic issues that force people to take out loans in the first place continue to drive up tuition costs.”
Along with the partial, one-time loan forgiveness, Biden announced a cap on monthly payments for federal undergraduate loans — lowering it from 10% to 5% of a borrower’s discretionary income.
He said the US Department of Education is also proposing a rule to revise income-based repayment plans in multiple ways. This includes forgiveness of loan balances after 10 years of payments instead of 20 years for borrowers with an original loan balance of $12,000 or less.
Biden has announced he will extend the student loan hiatus one last time. It was previously extended until August 30, but Biden said it will now last until the end of this year.