Should the government enact student loan forgiveness programs?

With student loan debt for higher education rising to new levels, many have called for student loans to be forgiven

Rise of the Issue

Americans currently owe $1.7 trillion dollars in Federally funded student loans, second only to home mortgages as a percentage of total personal debt. That’s an average of about $40,000 per borrower, as of 2021, which is more than a three-fold increase since 2006, according to the Federal Reserve. The debate around loan forgiveness re-emerged in 2020 when President Joe Biden, during his presidential campaign, promised Americans that all student borrowers attending public universities would get support for $10,000 in the form of student loan forgiveness. 

Those who demand debt forgiveness believe that it would help individuals as well as the economy at large. Some advocates want all debt to be wiped out, while others have worked to forgive debt in special circumstances, such as employment curtailed by COVID-19, students who believe they were defrauded by their institutions, workers with “frontline” jobs, and  other situations. Opponents of loan forgiveness cite statistics showing that a student loan is a bargain that turns out well for borrowers, that to forgive loans insults those who do pay back, and that most of the  debt is owed by persons in high-paying jobs.

Issue Timeline


National Defense Education Act is Passed

In response to the Soviet launching of Sputnik, Congress passed the act in part to create federal student loan programs.


Higher Education Act is Passed

The Lyndon Johnson administration expanded federal involvement in all levels of education, laying the foundation for today’s federal student loan system.


Public Service Loan Forgiveness

To combat problems associated with skyrocketing college tuition, Congress passed the PSLF program to reduce some burdens of repayment of student loan debt.


Borrower Defense to Repayment is Made Available

The Obama administration, in reaction to the closing of Corinthian College amidst fraud allegations, created a process for borrowers to petition for loan forgiveness if they felt they had been defrauded.


Trump Administration Places Hurdles to Borrower Defense

Secretary of Education Betsy DeVos made it more difficult for students to cancel debt under the borrower defense option by setting a tougher standard to prove intent to defraud.


Biden Administration Cancels $15 Billion of Debt

The Department of Education canceled $15 billion of student loan debt, affecting more than 675,000 borrowers, mainly via three programs affecting borrowers in the public service sector, those disabled, and those who believe they were defrauded by institutions.

Micro Issues


Socio-economic Inequality

Proponents of loan forgiveness believe that it would help students with lower incomes, while its opponents argue that it would only increase socioeconomic inequality by only helping higher income students more.



Some argue that helping indebted students would boost the economy by increasing their purchasing power, while others put forward the idea that mass loan forgiveness would only make inflation worse.


College costs

While some think that forgiving students’ loan would help students cope with an unfair educational system, others argue that it does not solve the wider problem of college costs in the long term.

Pro Arguments


Forgiving student debt advances racial and socioeconomic equality.

Persons from low socioeconomic backgrounds find it more difficult to pay back student loans.


Without the financial burden, some can be free to take risks.

The number of young entrepreneurs starting businesses has gone down since 1996, partially because so much money is tied up in paying back loans.


Debt burden restricts people from making other important purchases.

Leaving college with significant debt precludes many recent graduates from buying homes, investing, and making other financial decisions.


Debt forgiveness provides an immediate boost to the economy.

Forgiveness programs free up money that otherwise is spent paying back loans.


Other debtors have access to bankruptcy.

Student borrowers underwater deserve the same considerations as other holders of crippling debt.

Con Arguments


It’s not fair to those who paid off their debt.

People should be expected to enter into contracts with good faith. Those who fulfill their obligations are punished if those who do not are let off the hook.


It disproportionately helps those who otherwise can pay it off.

A large percentage of the total student loan debt is held by persons who have attained well-paying jobs.


Targeted debt relief is a much more equitable solution.

Those who truly face hurdles in paying back their loans should be helped, while those who can pay back should be expected to.


Student loan debt is not a crisis.

For a majority of graduates, a college degree is well worth the price of the debt with which they leave school.


It is unfair to taxpayers.

Taxpayers foot the bill for federally insured loans that are not paid back.