Readers discuss federal policy issues

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From time to time we all take one for the team and the Time Union Editorial Board, the editorial board’s student debt forgiveness is a good example (“Helping Help with Loans,” August 30). Being a long-time reader, I understand the editorial board’s political leanings, so I wasn’t surprised by the endorsement of student debt relief. But shifting debt from a privileged class to the less privileged (low/moderate income without a degree) simply cannot be justified.

Research from the Federal Reserve Bank of New York shows that college graduates earn 75% more with a college degree than those with a high school diploma. In addition, the terms of the new federal program provide for a limitation of reimbursements. The plan limits reimbursement to 5% of income (previously 10%), with the first $30,000 of income exempt. As an example, community college graduates earn an average salary of $35,000, so payments would be based on 5% of $5,000 or $21 per month. After 10 years (previously 20), any outstanding balance is forfeited.

Coupled with the $10,000 exemption, a large portion of the loans will never be repaid by the borrower. Nice deal for the privileged group.

Additionally, analysts estimate that with the limitation on refunds and write-offs, the total cost could be between $500 billion and $1 trillion. The inflationary impact will be there and probably significant. And, not to mention, it’s not forgiveness of the loan, it’s just transferring the obligation to other parties, many being lower-paid hourly workers who didn’t sign up for the loan, nor in benefit.

It makes no sense in terms of priorities, fairness, and economic impact, not to mention that President Joe Biden, without Congressional approval, has unilaterally committed taxpayers to billions of dollars of our money.

Posted on September 19, 2022

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