Recently I had dinner with some friends who were arguing for forgiving college student debt in the U.S. Their argument goes roughly as follows:
To pay college costs — in some cases over $60,000 per year — young people and their families can go deeply into debt, often for many years. Many are never able to get out from under that debt burden, and so their chances for economic advancement remain permanently crippled.
It’s not as though they have much of a choice. In the U.S. one’s chances for professional success are very low if one does not have a college degree.
My friends argue that the increased short term tax burden to pay off those loans would be more than offset within just a few years by the more robust economy that would result.
This is a powerful argument. Yet there are aspects to our nation’s state of economic disparity that resist straightforward rational discussion. But I can try anyway.
More tomorrow.
Check out COLFUTURA – NYU Engineering just did a deal with them – as a possible “blended” model for debt forgiveness. Although they are not (yet) universal, they provide a high level ($25,000 USD/year) of support for students from Colombia who study abroad.
The “scholarship” is a blend of debt and actual scholarship, and the debt part is forgivable, in part, depending on what you do after you graduate (return to Colombia, work in education or government, etc).
There is also a generous (five year) interest free allowance.
The financing for this is not purely government – private enterprise is involved too. This may help sway the thinking of those who might see initiatives in this area as “just another tax burden.” In fact, it is an investment – in people and the future.