The Student Loan Forgiveness Plan Is A Missed Opportunity

Good intentions but terrible execution

Photo by Leon Wu on Unsplash

I was one of the lucky ones, born to parents wealthy enough to pay for my college degree back before the cost exploded into the stratosphere. I don't object to allocating tax dollars to aid today's borrowers, many of whom fell victim to predatory loan programs.

It's good news for borrowers saddled with college debt, but the program does nothing to address the root problem of higher education costs. It's personal for me because my two kids will attend college starting in 2029, and I don't want them saddled with tens of thousands of dollars in debt.

Tuition, room, and board cost $30K for in-state residents at New Jersey's flagship state school. For two kids, that's $240K at today's rates. By the late 2020s to early 2030s, it will likely approach $400K all in.

The Biden loan forgiveness does nothing to address the root cause of spiraling costs.

Address the perverse incentive of higher education.

Let's suppose you sell widgets for a price of $1,000. Somehow, you worked out a deal with your buddies in congress so that your customers could secure a government loan to buy your goods. That means you get paid upfront and don't have…