To Pay Or Not To Pay, That Is The Question.

With apologies to William Shakespeare

I have been following the debate about student loan forgiveness with some interest. First of all, I don’t think there is any such thing as loan forgiveness. There’s only transference. The debt itself does not go away. Someone else is required to pay it.

Having said that, I understand the concerns of the students. They feel that they were sold a bill of goods. They were encouraged to accumulate significant debt for a degree that frequently has no value to them in the marketplace. How can they expect to repay a $50,000 student loan with whatever job they may possibly find with a degree in medieval English literature?

However, these people are intelligent otherwise they would not have been in college, and they would not have gotten a degree. They must have known that the likelihood their degree would provide them with employment sufficient to repay these massive loans was small. Additionally, they’re not the first generation to have found themselves in this dilemma. People my age, two generations prior to them, also found themselves with massive student debt and degrees with little market value. However, most persevered, and eventually paid off their debt

Those who repay their debts have little sympathy for people who wish to escape theirs, be it student loans, credit cards or taxes. The feeling is, you are responsible for your decisions, and you should pay the debts that you incurred.

There currently are programs that allow for some student loan forgiveness. These usually involve some type of service arrangement. Full disclosure, Uncle Sam paid for my undergraduate degree but in return he required six years of service in the United States Marine Corps. I received a loan forgiveness of $10,000 for my medical school expenses but I agreed to practice in West Virginia, an underserved area, for four years. (I’ve been practicing here for 29 years, so they got their money’s worth.) Older generations have more sympathy for student loan forgiveness if there is an obligation in return for that forgiveness.

I’d like to propose a middle ground. Have the government forgive all accrued interest for student loans while requiring the principle be repaid. This could be done without requiring any type of service commitment from the borrower. Additionally, provisions could be made for forgiveness of the principle in return for service that benefits the public in general. This could include such things as military service, teaching, public health service, law enforcement, and such things as foster care and youth programs. This would provide students with some relief from their high debts, and at the same time provide benefits to the country.

I’m not in favor of allowing people to completely escape their obligations but I recognize young people can easily be misled and should not be burdened at the beginning of their lives with unrepayable debt. At the same time, they should not be led to believe that they can escape all responsibilities by simply demanding that the government take care of them.

And that is my grumpy opinion.