In just about every poll in which they participate, Millennials rank student loans as the most important issue for them. How are the candidates addressing THE issue that most preoccupies this sector of the electorate, a generation more and more mobilized politically.
Most of you who come to CompareLend.com to look into student loans or consolidate your student debt. This week, however, we will not be discussing the topic of P2P lending.
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Instead, we’ll be looking at the presidential candidates’ positions on student loans and student debt.
Let’s start with the frontrunners
Hillary’s and the Democratic Party’s position has already been clearly laid out in their Platform. Copies can be downloaded from the Internet but I will highlight here the main points.
1. Making Debt-Free College a Reality
The platform calls for “bold new investments by the federal government, coupled with states reinvesting in higher education and colleges”. It continues by stating that Democrats hold the “strong belief that … working families should not have to pay any tuition to go to public colleges and universities”. They will also make community college free.
- Providing Relief from Crushing Student Debt
“Democrats will allow those who currently have student debt to refinance their loans at the lowest rates possible”.
Democrats also want to restore a prior standard to allow borrowers with student loans to be able to discharge their debts in bankruptcy. At present, student loans cannot be forgiven through bankruptcy proceedings.
The plan would cost about $350 billion over a 10-year period.
Questions remain. Is she doing enough? And will the Republicans climb on board?
In late July, he said that he was working on a “great plan” to address rising levels of student loan debt, to be revealed over the next four weeks. As of this time, no plan has been submitted.
Early on in the primaries, Trump did slam the federal government for profiting on federal student loans. In June, Sam Clovis, a Trump policy advisor, said that Trump would remove the government from the student loan system and have private banks lend money to college students instead.
Furthermore, Trump would make colleges share greater risk. So when deciding which students to admit or offer loans to, they will favor those who are more likely to earn more post-graduation. Not very good news for many Liberal Arts majors.
To combat student debt, Trump said he’ll “do something with extensions and low-interest rates,” without entering into details
I will be happy to update this post as more news comes in.
And then there’s
Popular among Millennials, one of the points in her party platform is to “guarantee tuition-free, world-class public education from pre-school through university”. For the 43 million Americans who are still paying back their student loans, the Green Party platform includes “abolishing student debt to free a generation of Americans from debt servitude”. Her idea is for the Federal Reserve to buy the debts, then declare them null and void. Student debt is currently at about $1.3 trillion dollars. Not much compared to the $17 trillion worth of practically zero-interest loans given to Wall Street. Unfortunately, a president cannot tell the Fed what to do.
Debt forgiveness would cost 7.5% of GDP but it would generate a tremendous economic stimulus whose beneficiaries are people, not banks.
I can already hear the Republicans howling. Stein will face a lot of opposition from a Republican-held House or Senate.
The Libertarian Party candidate seems contradictory about student debt
He wants to abolish “guaranteed government student loans” because they are the reason for increased tuition costs. He has also stated that he’s in favor of reducing interest rates on federal student loans, those same loans that he thinks should not exist. So perhaps it is beside the point that he thinks the federal Reserve shouldn’t exist either, all while he calls on the Fed to refinance loans. And did I mention that Johnson also wants to abolish the Department of Education?
To conclude: whatever your opinion, remember that your vote counts!
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