Biggerboat1 said:
1) I think it's relevant when someone who is taking a position against loan forgiveness, but for reform to the system that would benefit people going forward, is being labelled as selfish. I personally don't have a strong position on the loan forgiveness proposal as I don't know enough about the details. I did try to have a look but got a bit lost in the language being used in the particular articles I started to read... 2) How do repayments work in the US? Is it taken automatically upon reaching a certain salary threshold or is it voluntary? I mentioned earlier how it works in Scotland where certain degrees of debt forgiveness is built into the system & I'm perfectly happy with that. The bit that gives me pause around this policy (again, if I'm understanding it correctly), is that the rules are being changed in a retrospective way that benefits some who've simply not made the repayment of their student debt a priority, over those who have... I believe the forgiveness is means tested, only applying to those who make over 70K pa, or something, is that right? Does it also select for people who don't have significant assets? For instance, some may have bought a property/other assets rather than paying their debt, which again would leave a sour taste for those that paid their debt off before pursuing property ownership or investing in assets... 3) That's great, I think that's def a positive move! BTW, let me just restate that my main gripe was with the direction this discussion was headed in terms of tone, rather than the particular policy itself. |
1) Yeah, the way Biden has had to do forgiveness has essentially been to break it up to target it almost as much as possible so it can be pretty confusing to read through. I just feel like any path forward without helping the people who are already suffering inevitably misses the mark, especially when bigger change is not really systemically possible right now as that would have to go through Congress. Biden is doing what he can with what he has available to him.
2) So, repayment is confusing too so I won't really be able to break it down too well. Under Biden's new systems, if you enroll in an Income Driven Repayment plan, I believe your payment will be dictated by how much you earn and it will be $0 under a certain threshold, but there are numerous other plans which work differently. You largely have the freedom to pick whichever works best for you. As for forgiveness, it isn't being applied retroactively, which means if you paid your loan back, you will not see forgiveness (with a few minor exceptions which I don't think are particularly relevant). If you've paid more there will be less to forgive. That said, much of the loan forgiveness is being applied to people who have already been paying for over 20 years (so, if someone had the capacity to pay their loan off more quickly, they still might be better off than if they paid more slowly and received forgiveness), or forgiveness of interest (which wouldn't accrue if you paid off more quickly and there would be no benefit to paying off slowly to get that forgiveness). Otherwise, it is being done through programs like Public Service Loan Forgiveness which has existed for over a decade (and just been broken), so as far as the fairness argument, I think it is being done in a way that for the most part doesn't make people who didn't pay better off than those who did. As far as means testing, some of it is to some degree (like the interest forgiveness), but the things based on timelines largely aren't.
