Allow student loans to be discharged
Bankruptcy is an important tool in our society, and it’s one I think we should appreciate. While there might be some stigma that someone is a “loser” for filing for bankruptcy, plenty of important or powerful people needed to start over or reorganize in order to reach the heights they eventually would. Our president himself has declared bankruptcy multiple times. It’s a useful tool for everyone, and no one is a loser for using it on rare occasions.
My issue isn’t with bankruptcy as it is, but with the limitations of bankruptcy, or with one particular limitation: student loan debt.
Student loan debt is soaring to outrageous heights. It is now the largest amount of debt in the country. It is higher than credit card debt. Many young people are snowed under by these debt obligations. They are unable to save or plan for the future. They are unable to even to rent a place let along consider buying one. There will be longterm problems for the US economy if more is not done to ease this burden and allow those in debt to eventually become normal saving and spending citizens.
When the laws were put in place for student loans, they perhaps made sense. The cost of college was much less back then, and the only people who had a large student loan burden were those who went into high paying professions. Doctors can handle $50,000 or even $100,000 in student loan debt because of their future earning potential. The same is true of lawyers.
On the other hand, the average student now walks out of a bachelor’s program with at least $30,000 in debt, and that’s for any degree. A teacher will struggle to pay that money off in a decade, or even two decades and teachers are often expected to work towards a Masters once employed.
We now live in a time where those who received any degree, and particularly those who went to graduate school, are burdened with the kind of debt only doctors and lawyers used to have. Despite this, there is no mechanism to reorganize their debt if they fail to pay it off in a timely manner.
It can be argued (and has been) that students should have chosen better career paths, but that too has troubling problems for the country long term. While it might be argued the country doesn’t need more philosophy professors, limiting students to only choosing high-income fields means we could see an overabundance of doctors and very few of anything else throughout our society. We do need educated professionals in many areas, but with the fear of student loans that can never go away drawing people away from more diverse career options, we may find a lack of expertise in our country very soon.
If it is possible to discharge debt through bankruptcy as a business, as an individual, and as a farmer, among other things, and to get rid of credit card debt, mortgages, and other loans, there is no logical reason it should be impossible to discharge student loans as well. America just needs to change its laws.