Boston, MA– U.S. Senator and 2020 presidential candidate Elizabeth Warren has announced her plan for student loan debt forgiveness and free college tuition for public 2-year and 4-year institutions. Her proposal to forgive massive student loan debt for most middle-class Americans will definitely appeal to the debt-saddled millennial generation. Warren wrote: “College shouldn’t just be a privilege for those who can afford to take on the significant expenses associated with higher education.”
Warren’s plan would cancel up to $50,000 in student debt for every person with a household income of less than $100,000. Millions of Americans would be eligible for this benefit. The average student debt burden is $29,000.
The program would also make 2-year and 4-year public schools tuition-free in order to expand access to higher education. The senator plans to raise money for this plan with her ultra-millionaire tax bill that she introduced in January; her Ultra-Millionaire Tax bill would tax the 75,000 wealthiest families in America, taking 2% from families making $50 million or more and 1% from families making $1 billion or more.
Warrens says that this Ultra-Millionaire Tax would more than fund both the proposed student debt cancellation as well as universal free college. The program would cost around $1.25 trillion over ten years, according to Warren's team. If her tax plan goes through, it will raise approximately $2.75 trillion over ten years.
Warren says the student debt crisis really hits home with her. She explains that she used to attend college for $50 a semester, something that would never happen in the 21st century.
Warren stated: “Higher education opened a million doors for me. It’s how the daughter of a janitor in a small town in Oklahoma got to become a teacher, a law school professor, a U.S. Senator, and eventually, a candidate for President of the United States.”
Lindsey Burke, the director of the Center for Education Policy at the Heritage Foundation, says that the program would backfire. “Universities will continue to do what they’ve been able to do for decades, and that increase tuition because they [will] know there are policies like debt cancellation and loan forgiveness.”
Another objection to the plan has been raised by Tiffany Jones, the director of higher-education policy at the Education Trust, who asked, “What about those borrowers who have already paid off their loans?”
Other Democratic proposals for managing student debt are likely on the way. Bernie Sanders is running again in 2020, and he has made universal free college tuition and student debt reduction a part of his platform (which he has said could be paid for by increasing taxes on the financial sector).