President Joe Biden, congressional leaders and debt experts continue to argue over student loan debt forgiveness — both how much should be canceled and which branch can offer relief. Biden told a questioner at last week’s CNN town hall he did not think he had the authority to cancel $50,000 for student loan borrowers, and instead would limit relief to $10,000. Earlier, the administration had said it was reviewing its options for forgiveness through executive action. Even the more modest figure of $10,000 per student would represent one of the most ambitious projects under the new administration, erasing an estimated $377 billion in debt.
Student debt forgiveness is popular among voters, but a handful of economists have questioned whether it helps those most in need. They argue that middle-class families will benefit more than poor and marginalized Americans.
There are many ways to look at the types of people loan forgiveness would benefit: Should we consider household income? What about net wealth? How would borrowers of different races be affected? A Hechinger analysis of federal data provides additional dimensions to the picture of student debt. We show more detail about where student debt falls most heavily and how different cancellation plans would affect different groups of Americans.
First, here is the overall picture of student loan debt and its rapid growth.
Americans amassed trillions of dollars in student loan debt in the course of just a few decades. Throughout most of the Department of Education’s life as a guarantor of loans and a direct lender, student borrowing remained below $20 billion per year, according to a 1998 report from the Institute for CONTINUE READING: Interactive: Explore who gains most from student debt forgiveness