…more than 2/3 of American graduates were in debt as at 2016, and their debts averaged $29,650.
American billionaire “Robert Smith” has sparked a new debate on student loans, which began after he announced to students graduating from historically black Morehouse College that he would pay off their student loans. Since then, a good number of students, and politicians have all come out to air their views on the subject of Student loans.
The amount owed by students of the Morehouse College Class of 2019 is said to be around $40 Million.
Robert Smith is a Texas businessman who is also the richest African-American. Although his actions have been met wit applause by the general public, there are still some factions of people who are not entirely happy with the situation.
“Can a billionaire pledge to pay off my student loan debt? I’m glad for the graduating class, but also envious,”Twitter user writes, reflecting a sentiment common on social media.
With the election season coming closer, politicians have already began to weigh in. Several Democratic challengers to President Donald Trump in next year’s elections have already began to propose different ways to reduce the nearly $1.5 trillion American student loan burden.
“People shouldn’t be in a situation where they depend on a stranger’s enormous act of charity for this kind of liberation, to begin with.”Alexandria Ocasio-Cortez , via Twitter.
Alexandria Ocasio-Cortez is a rising Democrat House representative who was elected last year in part on the promise of free university education.
A 2016 report published by the Institute for College Access and Success details that more than 2/3 of American graduates were in debt as at the time of the report, and their debts averaged $29,650.
Paying off the debts accumulated by these young students is a long and arduous process that could take them between 10 – 20 years. Most times these burdens causes the delay in the starting of families and the purchase of cars and homes.
When taken into account, the effects of these debts and loans will generally have a negative effect on the overall US economy, and Smith isn’t the first billionaire to take notice.
– Mobilized billionaires –
In November 2018, former New York mayor Michael Bloomberg pledged around $1.8 billion to his alma mater Johns Hopkins University in Baltimore, from which he graduated in 1964.
The donation aims to make education at the elite school more affordable to low- and middle-income students, who would otherwise have to face fees and living costs totalling about $72,000 per-year.
Another billionaire, Kenneth Langone, gave $100 million to the New York University School of Medicine last year to make tuition free for its current and future students.
– Tax the rich –
Between the year 1996 and 2012 Student loan debt levels soared in the US, and Senator Bernie Sanders put the rising costs at the heart of his unsuccessful 2016 presidential campaign.
The following year, the independent politician from Vermont put a measure called the “College For All Act” before the Senate, which would have abolished tuition fees at public universities for most families.
The cost of the measure, which the Republicans leading the Senate has shown no interest in, has been estimated at $600 billion, to be financed by a tax on financial transactions.
Sanders is now among the 23 candidates for the 2020 Democratic presidential nomination, and together with Massachusetts Senator Elizabeth Warren has once again made student loan debt a plank of his campaign.
Warren last month unveiled a detailed proposal to abolish student fees in public universities and cancel student loan debt according to income.
The plan, estimated to cost $1.25 billion over a decade, would be financed by a tax on the very wealthy.
– State measures –
Though few other detailed plans have emerged, almost all Democratic candidates in 2020 argue for making universities more affordable.
With the election still more than a year off, some states are taking their own steps to reduce the cost of higher education.
New York state started offering scholarships last year equalling public university fees to students of modest means, with the caveat that graduates remain in the state for a few years after finishing.
Washington state governor Jay Inslee — another Democratic candidate in the 2020 race — on Tuesday signed into a law a bill raising a key business tax and using the revenue to make attending a public university free starting next year for students from families below the median income level.
The bill was supported by two of the state’s largest taxpayers: Microsoft and Amazon.