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If you received any Pell grants and make less than $125k, then $20k is forgiven. If you didn't receive Pell grants and make less than $125k, then $10k is forgiv

If you received any Pell grants and make less than $125k, then $20k is forgiven. If you didn't receive Pell grants and make less than $125k, then $10k is forgiven. That's what I've read so far, at least. I've also read the estimated cost of this is $300 billion, and doing the math on that and the number of taxpayers, I've calculated that the cost to each taxpayer is about $2k, which is less than the cost of tuition for one person at public colleges (or at least, less than the tuition at a public college near me). And this is to pay for the forgiveness for all student loans for these people that have accrued over decades. Tiny cost to help stop punishing people for wanting to learn in a society literally built upon knowledge, in my opinion. Especially if it acts as a proof of concept that paves the way for future policies applying to new loans -- which would be much cheaper than this all-at-once batch iteration. I'm in the group of people who would qualify for this. Do I care personally? Not really, I've spent the last 7 years factoring my loans into my budget and I guess I'm content with the sunk cost fallacy now. But do I care as a member of society? Absolutely. This is a wonderful step in the right direction. EDIT Correction: the $300 billion figure I read is not, as I first thought, annual. It is an estimate over 10 years. Which means the taxpayer cost is actually more like $208/year, not $2k. Even better!

noobly 4y ago
What are the odds it gets shut down? I'm reluctant to get too excited until it's more certain (of course I'll wait to celebrate until it's reflected in my balance, but just knowing it's a relatively sure thing would take a huge load off my mind).
- IceMetalPunk 4y ago
  That I don't know. Apparently they're using a 2003 act, along with the current pandemic, to bypass the need for congressional approval, so it may just be impossible to kill, especially now that it's been announced everywhere. But I'm no politician, so there could be more factors at play that could stop it before the disbursements.
ghiculescu 4y ago
Why do you think this will lead to new loans getting cheaper? It seems like it would make loans riskier (there’s now a precedent that creates less incentive for future borrowers to make repayments) and thus more expensive.
- IceMetalPunk 4y ago
  I said that if it proves the feasibility of larger. government subsidies on student loans, it could pave the way for future government policies that subsidize new loans. Banks don't care if they're getting paid by the borrower or the government, as long as they're getting paid.
  - ghiculescu 4y ago
    But you don’t think that will cause them to get more expensive?
    - IceMetalPunk 4y ago
      Someone in another thread suggested that universities will raise their tuition to offset the subsidies, for no reason other than profit. I hope that's not the case (it's dystopian to think education is subject to price gouging out of greed, but then I suppose if medicine is, we're already in that dystopia). But even if it is, the tuition would raise equal to the subsidies and the cost to the student wouldn't increase, it just wouldn't decrease. Best case is universities aren't entirely heartless and realize that they're surviving and profiting just fine on the current tuition, and the education they provide is so important that they shouldn't just raise costs arbitrarily "because they can" in spite of their students. In which case, the loan principals remain the same, but the student pays less. Worst case, as mentioned above, is we're in a true capitalist dystopia, in which case the costs won't get cheaper, but they also won't get more expensive. You mentioned the risk of nonrepayment. There is no increased risk of that: the loan servicers will definitely get repayed by the government, and the remaining balance (if there is any) has lower risk of nonrepayment from the student because the payments will be lower, and thus easier to afford.
Forgeties79 4y ago
For reference/comparison, the Bush tax cuts cost us somewhere in the neighborhood of 4-5 trillion. https://www.thebalance.com/president-george-bush-tax-cuts-3306331 https://www.thebalance.com/president-george-bush-tax-cuts-33...

noobly 4y ago

What are the odds it gets shut down? I'm reluctant to get too excited until it's more certain (of course I'll wait to celebrate until it's reflected in my balance, but just knowing it's a relatively sure thing would take a huge load off my mind).

IceMetalPunk 4y ago
That I don't know. Apparently they're using a 2003 act, along with the current pandemic, to bypass the need for congressional approval, so it may just be impossible to kill, especially now that it's been announced everywhere. But I'm no politician, so there could be more factors at play that could stop it before the disbursements.

ghiculescu 4y ago

Why do you think this will lead to new loans getting cheaper? It seems like it would make loans riskier (there’s now a precedent that creates less incentive for future borrowers to make repayments) and thus more expensive.

IceMetalPunk 4y ago
I said that if it proves the feasibility of larger. government subsidies on student loans, it could pave the way for future government policies that subsidize new loans. Banks don't care if they're getting paid by the borrower or the government, as long as they're getting paid.
- ghiculescu 4y ago
  But you don’t think that will cause them to get more expensive?
  - IceMetalPunk 4y ago
    Someone in another thread suggested that universities will raise their tuition to offset the subsidies, for no reason other than profit. I hope that's not the case (it's dystopian to think education is subject to price gouging out of greed, but then I suppose if medicine is, we're already in that dystopia). But even if it is, the tuition would raise equal to the subsidies and the cost to the student wouldn't increase, it just wouldn't decrease. Best case is universities aren't entirely heartless and realize that they're surviving and profiting just fine on the current tuition, and the education they provide is so important that they shouldn't just raise costs arbitrarily "because they can" in spite of their students. In which case, the loan principals remain the same, but the student pays less. Worst case, as mentioned above, is we're in a true capitalist dystopia, in which case the costs won't get cheaper, but they also won't get more expensive. You mentioned the risk of nonrepayment. There is no increased risk of that: the loan servicers will definitely get repayed by the government, and the remaining balance (if there is any) has lower risk of nonrepayment from the student because the payments will be lower, and thus easier to afford.

Forgeties79 4y ago

For reference/comparison, the Bush tax cuts cost us somewhere in the neighborhood of 4-5 trillion. https://www.thebalance.com/president-george-bush-tax-cuts-3306331 https://www.thebalance.com/president-george-bush-tax-cuts-33...