Investment

Davidson, we need to talk about student debt relief

by Hunter Callaway ’22 (he / him)

My first exposure to financial aid at Davidson was during my senior year of high school when I discovered that my aid program made Davidson the most affordable college option. The Davidson Trust exists to “meet 100% of the calculated financial needs of accepted students” through scholarship or work-study. Yet Davidson students who receive federal loans bear an average debt of $ 18,218. The gulf between common narratives surrounding student debt and its reality is not unique to Davidson, however, it has hampered attempts to resolve the student debt crisis. By centering the most privileged beneficiaries in our understanding of student debt relief, our speech erases the average borrower and removes popular support for the sweeping policies needed to resolve the student loan crisis.

The American Rescue Plan Act, recently signed by President Biden, extends stimulus payments and child tax credits to dependent students while providing billions of dollars in funding to higher education institutions. Half of the funding schools receive must be used for emergency financial aid, although individual institutions have control over which students get funding. The question “Who deserves to be relieved?” Takes on a new form, as a way to hide what is most important in this policy. Currently, under a Trump-era policy that the Biden administration has not yet changed, students with DACA status cannot receive this emergency financial aid. While it is reasonable to prioritize students with the most financial need in this new funding, don’t let the question of eligibility overshadow those excluded from relief payments.

It is imperative that Davidson use private funding to provide equal relief to students who do not meet federal funding criteria. Fortunately, our college endowment makes this possible. The reality for students of many other schools, however, is that ineligibility for federal funding makes the cost of college insurmountable. The narrative of who gets “unwarranted” relief, however, overshadows the government’s exclusion of DACA recipients. As long as hundreds of thousands of people do not qualify for these funds, the arguments on How? ‘Or’ What they should be disbursed only serve to erase those we should be working to include. Losing sight of this helps those who advocate for cuts in public spending and austerity in times of urgent need.

Attempts by senior Democrats to pressure Biden to write off up to $ 50,000 in student loan debt have failed in large part because of the rhetoric that the most privileged students unfairly benefit from a broad debt relief. Consider, however, that the wealthiest students are already the most likely to graduate debt-free. Whether you’re on track to graduate from Davidson with loans or not, take a step back and recognize the scale of the student loan debt crisis. American student borrowers are diverse in race, class and origin; government assistance to the most indebted will be an unprecedented victory for any young person trying to find financial security.

If Davidson is not representative of the experience of an average person in higher education, then what are we missing? Note that the benefits of a college degree are inaccessible to those who take out loans to start school without completing their studies. According to College Board data, 74% of those who do not complete their education will spend five years stuck in repayment plans without paying a single dollar of principal – the amount borrowed initially – on their loans. This practice is a modern debt tax, especially for those forced into lower paying jobs just to meet interest payments. While not graduating from Davidson is particularly catastrophic for a student loan borrower, our 93% graduation rate isolates much of our community from this reality for students across the country. However, there is more to this divide than just a gap in graduation rates.

The student loan debt crisis is taking its toll on people of color, especially black Americans. The financial burdens associated with student loans are deeply linked to the racial wealth gap, which makes expensive educational investments incredibly risky. In 2016, 33% of black graduates had $ 40,000 or more in student debt, nearly double the rate of white graduates. A loan forgiveness story that focuses on the potential earnings of a wealthy white student at an elite school wipes out the plight of many heavily indebted students. Forgiving this debt would represent one of the greatest transfers of racial wealth in American history, but those who oppose it see this policy as a regressive advantage for the more privileged.

As students, our interests align against a government seemingly indifferent to taking the necessary steps to support those who need it most. When we forget this, it becomes difficult to focus on the top priority – easing the financial burden on millions of Americans just to seek an education. As the Davidson administration must provide sufficient private assistance to our peers ineligible for federal funding, Joe Biden must also extend government support to DACA recipients and millions of other student loan borrowers. We have a responsibility as young people to hold those in power to account. People across the country need help now to have the hope of a life free from the burden of their debt. Are we going to let concerns about our own privilege prevent us from taking decisive action to end this crisis? I sincerely hope not.

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