Debate: Forgive Student Debt?

paying for college is a challenge and so is paying back student loans 45 million americans owe an average of 37 000 each enough to pay a year salary for roughly 27 million teachers no wonder so many former students struggle to make their monthly payments some politicians are pressing for loan forgiveness they say it would offer social mobility stimulate the economy and free up graduates to pursue their goals others say bad idea canceling student debt would burden all taxpayers with the costs of college whether they went or not would do nothing to address the soaring costs of higher education and would benefit wealthy borrowers who don't need their student loans cancelled so here's the debate should america forgive student debt hi everybody if you are in college or have been to college and you had to borrow money to make that happen this is a conversation this is a debate that you're going to want to hear i'm john donven this is intelligent [Music] squared so on the voting let's get to that first vote because it's time to cast it now we're going to ask you to do that by going to iq2us.org that's iq2us.org and i'll give you just a second to pull that up on a new tab and when you get there you will see that you are given a choice of four against or undecided so please make one of those choices undecided of course is a perfectly reasonable starting position again this is your first vote and again we're going to be asking you to vote a second time after you've heard the debate and that will determine who we name as our winner so if you haven't already gotten in your first vote one last time go to iq2us.org i'll give you one more second to get that first vote in okay now it's time to meet our debaters arguing for the motion forgive student debt ashley harrington harrington is a federal advocacy director and senior counsel at the center for responsible lending her partner dalia jimenez a professor at the university of california-irvine school of law where she is also director of the student loan law initiative she previously worked at the consumer financial protection bureau opposing them and against the motion to forgive student debt beth acres a resident scholar at the american enterprise institute and former economist with the council of economic advisors under president george w bush akers is also co-author of game of loans and author of the forthcoming book making college pay an economist explains how to make a smart bet on higher education her partner nick gillespie editor-at-large at reason a libertarian magazine and co-author of the declaration of independence how libertarian politics can fix what's wrong with america so here we are all four of us together i want to thank uh daiye and ashley and beth and nick for joining us live how are all of you i hope you're well great thanks for having me well thank you thanks for having us yeah it's great to have you and let's just get started with round one round one is comprised of opening statements from each debater in turn those statements will be four minutes each our motion again is forgive student debt and first up to speak for the motion here is ashley harrington ashley the screen is all yours thanks john we must cancel student debt we are at 1.7 trillion dollars for 44 million people and while so many of us were told that this is good debt the kind of debt that helps you that helps you build financial security and well-being that is not the experience of so many of those 44 million student debt is burdening our society in ways that we can't even that we don't even fully understand and it is disproportionately weighing on borrowers of color black borrowers in particular who are more likely to borrow to borrow more and to struggle in repayment and that is the direct result of centuries of racially exclusionary policies and practices that continue to this day cancellation will disproportionately help those borrowers and other low-income low-wealth borrowers who believed that the idea that this debt would help them that it would push them forward but the but the promise of that and the promise of the higher education act that lyndon b johnson worked so hard for in 1965 has not been met this is also an economic issue canceling student debt will put tens of billions of dollars back into the economy over the next decade this is at a time when we are a year into a global pandemic and recession we have lost lives we have lost jobs we have lost small businesses our economy and our society will never be the same and just like the student debt crisis is disproportionately affecting communities of color so too is the pandemic in the current recession and keep in mind that we entered the pandemic in the recession in in unequal places so many communities and families never recovered from the great recession communities of color lost over a trillion dollars in wealth that has never been regained so the recovery that had started leading up to this pandemic wasn't for everyone everyone wasn't included and now student debt is and student debt had already been exacerbating that and is making it worse if we want to advance racial equity if we want to provide an economic stimulus that will help everyone because everyone is helped if more money is it goes into the economy everyone is helped if these if folks can buy houses start businesses save for retirement that impacts all of us and if we want to have a recovery from covet 19 that is more inclusive and equitable than the recovery post great recession canceling student debt has to be a part of that it's also a solution that is easier to so much easier to accomplish than other policy solutions we all watched as we waited six nine months for six hundred dollar checks in the in another stimulus package congress has already given the president the authority to direct the secretary of education to cancel student debt president biden can cancel student debt on his own using the same authority that president trump used last year when he canceled student debt payments and waived interest and joe biden used that same authority this year when he extended that pause but more is needed we are at it we are at a place in this economy and in our country that is unprecedented and so there has to be a solution that is bold and meets the moment that's why you should vote with me to cancel student debt with us thank you ashley harrington our next debater will be arguing against the motion to cancel student debt here is nick gillespie nick the screen is yours thanks very much you know i come to this as a beneficiary of student loans i took out student loans to pay for my undergrad as well as my master's and phd level programs and without student loans i may not have been able to go to college or certainly not in exactly the same time frame so i understand the program and i've benefited from it and my experience with that as well as being a parent who has paid for college for two children uh one is still in college but i banked the money for him i'm urging you to join myself and beth to say no don't cancel student debt on mass because that's the proposition in front of us it's the bernie sanders proposition essentially which is just wipe it out wipe out the 1.7 trillion dollars of debt 40. you know i've seen numbers from 43 million to 45 million ashley's 44 is right in the middle let's go with that and the reason why i'm saying that is because we are mistaking an aggregate number for the effect on individual people which is generally extremely beneficial and very manageable so let me uh put some some human face on that about 56 percent of people who graduate with a ba have some student loan the average student loan is about thousand eight hundred dollars according to the college board uh the median is actually significantly lower but let's use that higher average number uh at current interest rates for student loans for federal student loans paid back in ten years that works out to about 275 dollars a month uh what happens with that when you go to college you increase your lifetime earnings somewhere between 250 000 to a million dollars depending on you can there are many many other measures that are somewhere in between that but it is a smart move to go to college and it is a smart move to take out twenty eight thousand eight hundred dollars in order to do it because you're going to be making so much more money one of my colleagues that reason peter suiterman has noted that annually a college graduate makes about 17 000 more per year than a high school graduate um i benefited from that i was able to enrich my human capital on that you'll hear from people like bernie sanders that he's met people who have three hundred thousand dollars in student debt half of all the dollars in student debt is for graduate school and much of that is for things like law school and medical school we don't have to forgive people's debt if they're going to law school or medical school right or graduate school more generally speaking i would say and we don't have to forgive everybody's debt because some people are struggling to repay their debt i like the idea of helping poor people i grew up lower middle class i benefited from some financial aid it helped me get to a place where now i'm paying far more in taxes than i would be otherwise at my current state i do not need relief from student debt from either that of you know my kids or whatnot and it would be insane in a moment when we have a unprecedented national debt which is constantly growing like a doubling cube and a game of backgammon it's just going up and up and up to say people who are making a hundred thousand dollars a year two hundred thousand dollars a year a million dollars a year hey you don't have to pay your student debt which is the type of proposal that's in front of us if there are targeted people who we can help give them more money so that they can get the opportunity to participate more fully in society that means lower income people that's a different issue than saying you know what let's forgive millionaires and their kids their student debt rather focus on the benefits of going to college taking out debt to get through it and then figuring out how to live the life that you want to as fully as possible so don't forgive student debt for everyone if anything what we need to do is to make uh college more affordable in ways that getting rid of student don't won't live you know won't even address and i'll get to that in my closing statement so please don't cancel student debt thank you nick gillespie all right next up on screen uh she'll be making an opening statement in support of the resolution for give student debt here is dalia jimenez the screen is yours hi thanks everyone um i'm gonna agree with nick on the proposition that uh student debt helps many um it helped me as well um as an immigrant but it really doesn't help uh everyone and it particularly disproportionately does not help black and brown students black families earn just 80 percent of what white families with the same level of education do and black women earn just 63 cents on the dollar that is that is paid to ever to white men with the same degree so they have to obtain the same or even more credentials than white people do to earn less than they do and they begin because of centuries of racial exclusion they begin behind they begin with less wealth than other groups so yes education is generally a great bet but the idea of forcing people to take a bet as an individual as opposed to society taking a bet on individuals the idea that they have to take this bet that is quite risky particularly for black and brown people has been a mistake it has been a policy mistake it is failed policy we need to stop we need to forgive student debt and we need to stop using student debt as the only way that poor people can get ahead in this country we need to stop doing that so it's a separate debate but right now we have 44 million people who have student debt and yes some of them have hundreds of thousands of dollars and they will be fine i was one of those lucky hundreds of thousand dollars i am fine i do not need you to free my student debt i already paid my student debt i don't want anyone to have to go through that if they are struggling i don't want anyone to have to go to default if they are struggling and we can right now as ashley said president biden can do this by directing the secretary of education to forgive the debt of as many students as he would like um the education is a public good we want people with education we want they have better health they're less likely to be involved in criminal issues they pay more in taxes they're more engaged in political and civic life we need an educated public but deciding to support higher education by forcing students who couldn't afford it to take out loans we made a mistake and as tuitions have soared and we told young people they need to go get a degree or multiple degrees to succeed that's what they've done and yet here we are 1.7 trillion and continuing to rise with no end in sight and now we are in the middle of another crisis where black and brown people are affected disproportionately and we have we right now we're sort of the stop gap people are kind of many of them are holding on um to see what happens this is the time to do it we have other programs in uh income driven repayment etc which are essentially on paper uh a kind of cancellation but really it's a cancellation only for people who can jump through a million hoops who do the right paperwork every year um and only if they do this for many for decades literally and it's just wrong to tell these people that they need to hold on for this long in order to forgive their student debt which they are struggling with paying and it would affect the economy positively immediately it would actually put um a number of people uh black and brown people in particular into positive wealth territory where right now they're in negative wealth we are also spending way too much money to service this debt okay the department of education doesn't actually release many numbers but as far as we can tell they are in bankruptcy for example they spend thousands of dollars so that a person who owes a couple of thousand five thousand dollars ten thousand dollars um does not get that forgiven in bankruptcy because it is difficult to do it and the department of education often opposes those um cases and they spend thousands of dollars to do it they're squeezing blood from a stone it is not going to work we should just forgive student debt thank you dalia jimenez and our final opening statement is against the resolution to forgive student debt beth acres the screen is yours thank you ah forgiving student debt it's the policy sledgehammer that we have now on the table as a solution to all that ails higher education the problem is is that what we need is a much more nuanced solution and there are two primary reasons for that that i want to argue right now first students with student debt people with student debt are not this homogeneous group of economically downtrodden individuals that is often characterized in the media if you've learned about student debt through reading the newspaper you've probably imagined that people with student debt are all of the same sort all economically disadvantaged there's a few facts i want to convince you that that's just not true what we know is that children from higher income families actually take on more student debt than children from more disadvantaged families that's because they go to school longer they go to more expensive schools and they often go on to graduate school and so you know this is a benefit that's being taken advantage of by people who are already quite well off in the economy the other fact is that more than half of the outstanding student loan balance in the economy today is held by people who are in the top 40 of the income distribution what that means is that if we were to forgive this debt this would be a hugely regressive policy yes people with low income would benefit but people with high income would actually benefit statistically much more to me that's a very poor way of crafting a solution the last thing is that we see that people who are defaulting and actually really struggling on these loans are not those six-digit borrowers that you often read about in the newspaper what we see is that the ones who are hurting are people with small balances statistically the people with less than five thousand dollars in student debt are are the most likely to default on their student loans that's because they don't have the benefit of a degree to go out into the labor market and have the extra earnings to make that repayment affordable here's the other thing i'm worried about if we do this things are about to get way worse so we've we've had my fellow debaters referencing tuition inflation as a problem um overborrowing people people using the the loan system to finance their entire education these are concerning things today what happens if we wipe away all of the student debt today to the student who's going to college tomorrow i advise students on how to use the federal aid system to their advantage to make make the most out of the dollars that they do have and and make the most out of their education and what i suggest is that they borrow every penny the reason is this student loan capital is really cheap compared to cash if you've got cash in your pocket you should still borrow to pay for school it's a low interest rate and you get a higher return in the market the second thing is is that you have the opportunity to be eligible for forgiveness if you end up with not a huge income after you graduate those problems become exacerbated if we forgive students start forgiving student debt in mass today so if we have mass cancellation today very likely in the next few years we're going to have tremendous pressure building up on politicians who will just go ahead and do that again the next effect of that is that we've got colleges with students coming to them saying i've got all this cash to spend through the federal lending program and the colleges are going to increase their prices so the problem of out-of-control tuition inflation that we're already seeing today will only be exacerbated by the problem that people are able to borrow with the expectation that they're not going to have to pay it back so we're compounding the problems that we all see as core problems today and that's why i think that we need to vote no no student loan cancellation we need a much more nuanced solution thank you very much beth acres and that concludes round one of our intelligence square debate where our resolution is forgive student debt and now we move on to round two and round two is a more conversational round the debaters address one another directly and they also take questions from me uh to get things moving and what i think i heard in the opening round was definitely some areas of agreement i think uh everybody on the panel agrees that college has become ridiculously expensive i think everybody agrees that college at least in theory um is a ticket to uh to a better life to more opportunity potentially to higher incomes depending on their status and situation so there's some agreement there but there's clearly disagreement on the past and the present effects of um the loan programs that have been affected in effect since the mid 1960s and i want to take to you ashley the question a question based on my perception that your opponents um uh nick and beth are what i hear them opposing is a kind of mass present day mass forgiveness of debt which is to some degree on the table uh as a result of um recent political campaigns in the democratic party uh committing uh in its platform to the idea of a ten thousand dollar across-the-board debt but certain candidates wanted to go much farther than that and your opponents are saying across the board doesn't make sense we should be targeting individuals if we're going to forgive because not everybody needs it then i heard your argument really focused around people of color being those who are the ones who are challenged so my question to you is is there some actually room for agreement in the sense that you're not actually arguing either for across the board because your focus seemed to be on people who were more challenged by being economically marginalized so what about that is there room for agreement there or do you think that across the board really is the way to go so across the board is the way to go and that's for a number of reasons first i want to just be very clear i tend to be optimistic and think that we live in a country where we can we can implement and have more than one policy solution at a time we can absolutely cancel student debt and make lives better for millions of people and help the economy and do something about the rising cost of college and the affordability crisis because what's driving up tuition will not be canceling student debt it's going to be the budget holes in the state government budgets like after the last great recession and all of that and some of that cost being passed on to students and families it's the lack of accountability for for-profit colleges in the system that raise tuition for poor quality products and are responsible for most of the defaults and non-completions so there are other ways to deal with the rising cost of college as being passed on to students and families doubling the pell grant that we can do and we can do these things simultaneously also let's remember income and wealth are not synonymous and it is a very different experience at the same income level when you have family income generational generational wealth and you don't and most people in this in color in this country don't black families have a tenth of the wealth of white families latino families have an eighth of the wealth of white families so this is very different um i i think we have to we have to remember to put this in context and i and and so across the board is best because whenever a barrier is placed whenever we make someone prove they are deserving of something i want to be very clear the only people that we make prove they are deserving or something in this country are poor people when we want to give out benefits we make people prove they deserve to have benefits but we don't do that any other time we didn't do that when we were giving out land um and gi bill benefits and denying people mortgages right we made p we didn't we made people do the other things so i think um so when you put up barriers you automatically are putting up barriers that that are going to leave out the marginalized the vulnerable right that's the same thing that we see dalia was talking about the problem with with with um the income-based forgiveness only 32 people have gotten ibr forgiveness very few people have gotten public service don't forget can i can i break in ashley because i i actually want to get uh some response to the point that you made just before that one from your opponent so nick lesbi um what i think i hear ashley saying is across the board is sort of the way to get it done um because i i i think what i heard actually arguing is that um it removes the barrier for people to have to prove that they need it if if the program can be just well i i i just want to say we're just advocating fifty thousand dollars of cancellation per borrower that's what i'm that's what we're talking about he's gonna take care of most undergraduate only two percent of undergrads have more than fifty percent in student loans um but again as uh beth was talking about people that that includes a huge number of rich people and by rich people let's say people are making 50 more than the median household income you know 90 or 100 000 there is no reason on god's green earth that wealthy people should not be paying their way and when they take out loans or their kids take out loans they should pay them back we do not have an unlimited amount of money that the government can simply start saying we're going to start paying things off i think dalia's talked about debt service and things like that debt service for the federal government is already the third largest annual item on the federal budget and it's going to soon be bigger than medicare and defense spending you know you can't just keep making you know uh printing money one way or the other to pay off things like that we should live in a society where people with means pay their way and then we help people who need help in order to participate fully in society whether it's through going to college or a variety or giving them access to better schools in k through 12 and things like that so i think there's that the one thing that i do want to point out is for all the discussion of college being out of reach of average people or middle class people and again when you hear people like bernie sanders and joe biden and elizabeth warren start to talk suddenly they're talking about people who are making hundreds of thousands of dollars who don't need the help i mean it's a very weird arbitrage of a class-based argument or or an identity politics-based argument that ends up somehow it's wealthy people who are getting the benefit but um the the national center for education statistics keeps a rolling average of low-income people the percentage of low-income high school graduates who enroll in college and it's at 69 for the last year that it was counted was 2016. it's at 69 an all-time high when you look at the number of high school students who are immediately enrolling in some form of college again always near or at an all-time high and it's increased massively since 1970 from maybe 50 percent and it's okay let me i see dalia is looking very impatient on this one go ahead sorry um uh so i mean i want to jump in there on this idea that uh you know the rich people are taking advantage of student debt and and maybe they are but the point is that they're rich and so they have wealth to fall back on if they're in default the rest of the of of people do not and they so we're not talking about that we're talking about forgiving debt why should somebody who comes from income and wealth are not the same if you're making ninety thousand dollars but you can't buy a house are you wealthy uh was waiting her turn for a long time and she got 20 seconds out all right so if we if we forgive fifty thousand dollars ninety fifty thousand dollars ninety three percent of the lowest income black household with student debt would experience total debt relief and seventy five percent of all borrowers would not owe any money would people who have wealth and or inc high incomes also get some of that debt forgiven if you do it as an across the board yes and you want them to pay you know we have a system to do that it's called the tax code okay if you want them to pay you take the money out that way in doing means testing or some other way of of basically putting hoops and uh and hurdles in front of what is primarily black and brown people in order for them to get forgiveness for a debt that we never let go student debt federal student debt has no statute of limitations the student the federal government can take your social security money can take your tax refund i mean this is just it's it's give it's draining young people of hope we need to do it just that they have hope and it cannot just be to forgive student debt i agree with that we can't just do that and then continue in our merry way we're just delaying the inevitable of the same thing happening again no we need to change how we fund education and we need to do that by actually looking at what colleges are or what schools are actually helping students and funding them not funding individuals and not funding for-profit colleges through individuals for-profit colleges by the way could you specify what percentage of students go to for-profit colleges it's it's as single digits right i mean i don't think single single digits but black borrowers are actually over-represented at for-profit colleges they prey on low-income people and people of color and veterans because they get the primary they get more of their funding from federal dollars than any other type of institution the vast majority of their funding and they over half of the defaults come from these institutions virtually all college students a vast majority go to uh non-profit state estate supported institutions so i'm simply saying if you focus on for-profit you're actually talking about a relatively very small percentage of of the debaters i need to make an opening here for beth because you haven't had a shot yet at this round of the conversation beth if you want it i just opened the door for you yes thank you i really appreciate that because there's something i have been wanting to get in here the conversation here is matches the conversation that i see more broadly on this issue and it's suggesting that student debt as it is today is totally inescapable you may even have heard that you can't even get rid of student debt in bankruptcy but the reality is that that's because we already have in place a safety net for borrowers that makes it so that if monthly payments are unaffordable they can be lowered based on how much you're earning without penalty if those monthly payments remain unaffordable for 20 years a borrower then has their entire balance forgiven and we are about to see with the passage of the stimulus bill that there is no longer a tax bill that comes along with that for the people who receive that benefit this is a huge benefit and it's actually very well crafted to ensure that somebody who goes to college makes that investment but doesn't see that return they're not stuck underwater on their student loans for their lifetime and someone can look forward and say i can see that this forgiveness is on the horizon i'm going to make the minimum payments until i get there there has been recent criticism of this program people saying there's only been a few people who have ever gotten forgiveness that's because it's new we did not create a safety net for student loans when we created student loans it was an add-on later on what kind of what kind of sort of realistic real world monthly payment are we talking about a person needing to make is it sort of in the 75 range a month or more in the 400 range a month well the thing is it completely depends on how much someone's borrowing the way that the monthly payment is calcula sorry how much they're earning and borrowing the monthly payment is a fixed percentage of their disposable income which is calculated as the excess over um some modest level that is set aside for for earnings um for for living expenses the problem with this program is that there's a variety of different parameters different people have different eligibility for different rules it's a mess and it absolutely needs reform but that reform is the sort of nuanced solution that i'm talking about rather than wiping out student loans and creating all of these so i want to take the scenario you paid to ashley because actually what i think i hear about saying is that um even for people who are burdened she's suggesting there's a there's a way to survive it now um and ultimately a way to get out from under it though it might take a couple of decades but that it sort of a suggestion that it's livable as opposed to crushing um what's your response to that i mean i think surviving right why wouldn't we want people to thrive why wouldn't we want our economy to thrive 20 years into repayment the typical black borrower still owes 95 of their original balance the typical white borrower has paid off 96 so what we are saying when we're relying on income based repayment which doesn't work because only 32 people have gotten that forgiveness and there are only 32 is that is that 32 it is literally true and i'm that's because that reached out i do think i'd more more have reach eligibility in 32 i agree with beth we need to fix ibr and canceling student debt canceling fifty thousand dollars and clearing out the debt of 75 percent of federal borrowers and 95 of the borrowers in default gives us the space to do that to make an income based repayment system that actually works that's actually affordable and based on an affordable amount of income and that's not two decades long it should be 15 years and people should actually be able to get forgiveness at the end of it and we shouldn't be saying oh it's okay for you to struggle and survive with your student debt especially when we know we're saying that to black and brown people to low-income people no one is staying in student debt for two decades if they're rich and wealthy that that is not that is not happening and i can totally disagree with ashley here you know the idea that we could be proposing idr should only take 15 years before you get to forgiveness but that's a policy conversation that i want to have because that's one that makes sense and really meets us where the problem is with student debt rather than as i said before coming in with a sledgehammer that creates all kinds of new problems your opponents oh go ahead nick and then i want to go down i'm just going to say you know so so we forgive 1.7 trillion dollars you know we snapped 50 000 a borrower yeah 1.7 trillion okay so let's say let's say it's one trillion dollars just um like we snap our fingers like thanos and that's gone it gets added to the federal balance sheet which is already you know it we're already paying interest on that it is that's actually not how it works no actually let me let delia respond to that then it does not get added to the we've already spent that money and we don't even expect mostly so why don't we forgive all of our debt i mean this i it strikes me as we're having a conversation as if the federal government doesn't actually have to pay anybody or pay anything back or anything that there are no ius that there's no limit to what the government can choose to spend and that simply isn't true i mean that's that's actually literally true since the government makes the money but it's not necessary i'm not saying it's a good idea to spend money everywhere but it is literally true it was true when they did a 1.7 trillion dollar tax cut in 2017 when we passed four trillion dollars in response to code over the past year which is desperately so we don't have to pay that money back that money doesn't get paid the cbo has already the when the loans are dispersed the full cost of them is already accounted for in the budget the cbo has already accounted for this and so that money is out the door that's on the balance sheet it's already done what it is doing is holding down individual people's balance sheets and balance sheets of people who are they're not lots of this is not going to be paid back we're servicing and keeping stuff open that's not going to be paid back most student loan gets paid back i i mean for certain people yes for certainty i i i want to take okay i want to move forward a little bit with with a point that was raised earlier by your opponents i believe by beth um that uh if if if the if the program you're arguing for were to come to pass and a significant amount of student debt were wiped out the stroke of the president's pen uh on let's say april 1st that may be a very hard political sell to all of the college students who went borrowed paid back their debt cleared it off worked hard to do it they're going to say well why did i do that where was where was my turn for that and and i i just wanted to ask you to address that issue because i think it's probably one that would occur to a lot of people who are watching the debate yeah i'm one of those people yeah you are actually you said you got 140 000 in debt and you know i was able to pay it off great great for me i struggled i don't want anyone to struggle and many are struggling way worse i don't feel sorry for me many are struggling way worse than i had to go through i think there is an interim period right like beth is talking about making these uh really nuanced policy decisions great when does congress ever get to do that when does that actually ever happen we need to president biden can actually do this right now forgive fifty thousand dollars per person across the board easy fast no means testing boom then we have a smaller program not 1.7 trillion dollars to deal with where we can then you know improve idr by the way idr is not one program it's four or five programs and they're different and you're not eligible for all of them and it is a mess and even people who study this don't know it off the top of their head okay because it is just so complicated we should not be making people go through all these hoops and learn all of this nuance just all of this silly stuff really um in order to get forgiveness in two decades all right um beth i want to take a question to you um your opponents i i i again i think in ashley's opening comment she's sort of alluding to the idea of of an individual's education not just being about that individual but it's actually a public good that that individual number one uh if by being educated uh number one can be a a taxpayer um contribute to the economy um just contribute socially and also that being relieved of the tax burden freeze that money up to be to become a stimulus in itself in the economy not i now actually didn't say it would pay for it itself fully but she said that it's a positive benefit to the economy particularly in this year of covet to have people have more money in their pocket to be able to spend more i just want to ask you to address that part of her argument sure so um this is this is a common belief that student debt would actually be a really effective stimulus which is particularly important right now we're in a depressed economy the problem again is actually what i mentioned before about the regressivity of the policy when economists craft stimulus programs they cut checks and send them to people who have the lowest income in the economy because the way that stimulus works is that you need people to go out and spend that money and for for it to actually have a stimulating effect on the economy when you give money to more wealthy people that has a lower multiplier they they go less into the community and spend and it creates fewer jobs and and fewer sales and things like that and so student loan cancellation has that same problem since a lot of it goes to very well-off people it's really inefficient because they aren't the ones who are going to go out and stimulate the economy the other problem is that let's say we were to forgive the whole thing that's 1.7 trillion student loans are are totally different from that number from what people see on a month-to-month basis so we may be alleviating a 200 a month payment for somebody with a decent amount of debt it's costing us again that 1.7 trillion but we're only getting a small fraction of that stimulus today because of the way that people are having their cash flows only have to manage a monthly payment on their student loan so is it a stimulus yeah does it address racial wealth inequality yes does it do these things very very very inefficiently yes and so the problem is if if those are the problems we're trying to solve there are more direct solutions to those problems than student loan cancellation actually i'd like to let you respond to that well i think we've got to be very careful to say from our purge and our position in our lives that a 200 monthly payment is not hard i think we've got to be that actually is hard for a lot of people who are struggling so i think we've got to be very clear about that that people have different levels of what is considered a struggle and there's a lot of people who are absolutely struggling to make their payments um there's been numerous studies done that show the economic benefits of cancellation and how that will be put back into the economy over the years i and i think we've also laid out how it's not just rich wealthy people and very f and the majority of people who will get these benefits are low income low wealth people student debt the balances themselves having student debt add to the cost of credit over the course of someone's life it prevents them from saving it affects their ability to get a home they can't save for a down payment it also means that that money is determining their debt to income ratio when they want to qualify for a mortgage and we just saw the news that housing prices are skyrocketing so if people have a bunch of student debt and the house the houses cost more and they can't get a loan to get it because they can't qualify and they couldn't even save for a down payment again we all are impacted by a housing market that doesn't work as we saw in 2008 i don't think like we the housing market is a central piece of our economy and if people can't participate in that fully we are all impacted so so nick i i noted in your opening argument that you painted a different picture of what it means at least it did for you in what it meant to take on debt and then how that leveraged you same into more opportunity in your life and and ashley's point painting a picture of somebody being really really constrained really confined by that debt to be able to have opportunity in life so and and and i i think there's something very compelling to the way ashley is describing it so does it come down to the fact that this is really really individual or is there a general statement to be made well i i think there are general statements to be made which need to be kept front and center if if you believe that there are limits on what the government can spend you know continuously without having some kind of massive economic collapse um you know then you have to look at things in in you know in in general terms that obviously you know impact individuals 56 of people who graduate from college have student loans so it's a slim majority right the average payment is about 300 a month for somebody who's poor that's really bad but it's also true if you go to college you get most of the benefits of a college education which includes a million dollars or more you know on average and lifetime earnings uh 17 000 more in annual income over time you are unlikely to be unemployed at half of whatever the unemployment rate is you get a huge amount of benefits and it should be a very basic moral principle i think in society that a person who gets most of the benefits of something pays most of the cost of that and that's what student loans allow people to do they allow many people to have access to higher education in a way that makes it easier for them it's also true if you look over the past decade you know we're talking about student loan the actual amount of student loan going out has been declining for a decade places like community college two-year colleges everywhere in the country you can qualify basically for free to go to the first two years of college for free there have been a lot of adjustments to the ways in which people have access to higher education it is not a system that is great and i would i'll in my closing remarks i'll talk a little bit about that when we talk about rising costs we're not talking about rising costs everywhere we're talking about rising costs at elite institutions that's not going to be addressed by getting rid of college uh you know getting rid of college debt but the fact of the matter is it makes sense to go to college and it makes sense to take out reasonable amounts of money to do that right there are colleges at every cost point possible and it's far more important that you go to college rather than which college you go to all right delia i i just i mean so i i think we're saying kind of we're talking about different people um nick is talking about the average person he's really talking about the average white person 40 of all borrowers including 54 of black students do not finish college they do not get that million dollars in lifetime earnings they instead get student debt that they're supposed to pay for at least 20 years and only if they jump all the right hoops every single year paperwork burdens to do idr black graduate students continue it from in the last from 2000 to 2016 they took on 30 percent more debt um in order to go and get a graduate degree because they saw that in the market in the in the in the labor market that's what they need in order to earn close to the same amount that white uh borrowers get um we can't do that and so nick says oh we can't spend money forever i agree we can't spend money forever on everything but the idea that we can't do this now because we gave too many tax breaks to rich people it's just really wrong and as beth says you know we don't even want to giving money to to rich people doesn't mean they spend in the economy but um and but that's what we've been doing we've been doing that for years now and so now when it's time there's all these people suffering we say oh no i'm sorry like we already spent too much money i and and we know that the majority of these people are going to turn around and put that money not the literal you don't give it to them but the money that they would have used to pay they're going to put that right into the economy so it's not a zero-sum game either just the fact that you forgive student debt doesn't mean that you now have you know you're no longer going to get any money no the people who get the million dollars in lifetime earnings they're going to pay more in taxes so beth donald you mentioned you know that cohort of people and it's it's not small who who borrow money go to college don't finish college now have debt worst of all worlds they don't get the benefit of having the degree and they have to pay for the degree that they never got to talk about their predicament and how you feel that this this debate we're having relates to them yes so these are the people i'm actually the most concerned about people who start college and don't finish often these people end up with actually really small balances but statistically they're more likely to default than somebody with six figures in debt so fortunately these people are currently eligible to make payments in the income driven repayment program and ultimately have their loans forgiven now the problem that program works really poorly it's challenging people to figure out how to use it and you know some people argue that it takes too long to get to forgiveness that's a reasonable criticism too um but that program is very well structured to deal with the problem of people starting college but not being able to finish it if we were just to make some tweaks it would be wildly inefficient to use the sledgehammer of student loan cancellation to address what is a very specific problem for this group of people if we can just just make a point there i mean we don't actually know if it would be wildly inefficient because we don't know exactly how much it costs the department of education to service this debt to every year get their servicers to call these people to get the paperwork to process the paperwork so they can enroll in idr which has to be done on a yearly basis and guess what if you don't don't have a job right now um and you lost your job but it's based on last year's income so it's going to be a problem for you in the real world to actually make those payments i agree i think delhi is right on this one it's that there are there are problems and i think the idr program needs some significant changes i just don't think that the right solution is mass forgiveness if we forgive 50 000 off the board you've gotten rid of 95 of those problems and now you can concentrate on do you start up the loan program again then you then so no you know i mean is this like a one-time jubilee and then it starts building again or so um how do you pay for college you we can do both the president uses his authority that's already been given by congress to cancel fifty thousand dollars in student debt per borrower and congress does its job because we are more than overdue for a higher ed reauthorization and they enact policies that make it no longer a primarily debt finance system they create a system that's workable they fix income based repayment the way that beth and dahlia and i are talking about so that it's more manageable going forward we can do all of those things i don't think the sledgehammer is cancellation the slash hammer is what people are feeling in their life is the 1.7 trillion dollars that is weighing people down and weighing down the economy but it's not most people wait let me just finish if that's okay thanks the biggest predictor of whether you're going to borrow is actually whether or not you're a pale student let's remember that also black college graduates have less wealth than white people with high school degrees or less we are not starting in the same place and we cannot have a conversation as if we are we also it is a public good it is a benefit to people to us to all of us to have a well-educated society where everyone can participate it is a public good it helps with national security it all of these things are intertwined with a higher education system that works and that actually works for everyone why are why is it okay to say oh well you can go just take on a bunch of debt that you're never going to get out from under but that's not actual people there's a term for that it's called predatory inclusion some people do okay no no no the majority of people do the majority vast majority of people do not default on their student loans wait wait wait yeah we'll talk about the rest in a second but what i'm talking about i graduated college i paid for my entire undergraduate and i came out with student loans and i paid 200 this is back in the 80s 200 a month i had no money so you know i i understand what you're saying that different people started vastly different parts of you know of the country you know uh that you you come out of college or you if you even get to go to college i was the first generation of my uh in my family to go to college you know so i understand what you're talking about with that but you are painting a picture as if colleges or the federal government which is the one that is doing all of the federal student loans is a is a payday lender that is ripping people off and selling provinces it is but that's the picture you're painting you're talking about them as predatory lenders this is true i never said they were predatory lenders i never said that the problem is we have a debt finance system in a society that is inherently unequal right so the people who need help as opposed to people who are well off and can afford to pay for college you and i have very different opinions about who are the people that need help right we very much differ on that and i just want to say to you i think it's awesome that you've been able to pay off your debt i think it's awesome that you're helping your kids there are so many people who have not been able to do that and if we get cancellation if everyone here agrees with us then i encourage you if you don't need it to opt out but not make it harder for other people to opt in yeah you know what i i've got to say uh you know if you're making a hundred thousand dollars in america you're doing you know vastly better than the median of family income household income you don't have a right to say i should i should get my loans forgiven that i took out in full knowledge of what i was doing this is the way the system works and it and you know we we look at the hard cases and people who are falling behind for various reasons we help them the the whole country the reason we have 23 trillion dollars in debt which is going to be going up by another 10 trillion dollars faster than we can even imagine because this stuff gets ahead of us is because suddenly people who are comfortable who are upper middle class or rich are starting to say no you know what everything needs to be universal you know it just it's it's a bad system i want to take a question i want to jump in with a question that that that is related to where we are in the conversation but was was inspired mostly by by ashley's opening and also um supplemented by by what dalia had to say and that is that the the two of you have have made the case that attacking this issue including a broad-based solution is has the important benefit of addressing social injustice of writing a social injustice that in fact that the the segment of the population that is more likely to struggle is more likely to be black than white for example and there there was a paper that you wrote dalia uh which i actually recommend you published last year goes into sort of lays out a very very detailed analysis of the situation but there are some statistics you use you you repeatedly point out this disparity so you're talking about um students who borrow federal federal loans but don't complete their education um and then default so you said that that happens to 38 of the 38 of white students who borrow federal loans but did not complete their education's default 65 percent of similarly situated black students have the same situation so it's it's roughly only two-thirds of white students are in that situation compared to black students and my question is and i know this is a very hypothetical but if there were not this disparity if if it were more evenly spread would you still be arguing for for wiping out student debt if if there were not the social justice element which seems to be really really central to your argument and i know that that's maybe a meaningless if but i i'm just trying to sort of get at the principle of whether it's primarily for you because of the social injustice or is it more broadly just about education the value of public education as a public good etcetera so i whichever of the two of you would like to take care of that question because it just it's it's both and you can't we don't even know how if we even tried we could get to a truly post-racial society i mean are we talking reparations like i mean how do we get there so it's really hard to just wipe that away pretend it doesn't exist because it does and the black person who doesn't graduate continues to be a black person go into a labor market that way and you know uh get lower earnings as a result i think you know it it's it's just not i guess i'm asking because your opponents keep arguing you know well-off white people don't need this so i would if i may i'm i'm the libertarian which means i'm also a closet marxist well-off people i i insist on a class-based uh argument at least okay well-off people don't need this they yeah you don't need and so that's why i understand i understand as income well-off does not just include income okay you can't it can't just be that you're you're making it's just you just can't you you can't income and wealth are not the same thing and you mentioned you mentioned you mentioned the elite schools nick right so harvard the quote-unquote quintessential elite school only three percent of folks at harvard borrow three percent so this is not who we're talking about we are talking about the vast majority of people who like that that we have to have a very realistic conversation about what student debt looks like and what student borrowers look like and it is just not the case that there are all these elite school graduates these rich wealthy people who have student debt they don't they don't because their parents helped them right they had intergenerational wealth so i i i just think you can't make me i can tell you myself i started in the hole i had a negative value when i went to college i put money away for my college uh for my kids college they did not take out any loans so you know i i understand very clearly the difference between income and wealth and i also understand at a certain point when you are making a certain amount of income you get to be called wealthy whether or not you come from the rockefellers or something like that and again this if if this argument i mean why should college cost anything to any student i mean the way that you're talking about things is as if well student debt nobody should pay debt to go to college or so i mean like what is the pricing mechanism here what where where where is the stopping point for just saying the government should provide everything that everybody wants in every circumstance okay it's actually i want to step in because we have a little bit of time left and the last run has really been you and nick and dalia and beth have not really had a chance so i want to give them a chance to enter the conversation at whatever level they would like to at this point and uh since nick had the last uh few minutes dalia i want to go to your side and let you jump into the conversation yeah i mean i'm going to step back a little bit and just talk about how this is not the way we want to fund higher education i think it's important for the federal government to be involved in higher education it's important for them to support it debt is not the way if you want to control tuition if you want you know people to be able to go to college affordably and you think there's a runaway tuition problem you don't give 44 million people money to go shop wherever and you don't allow basically anyone who has any school that has uh you know a pulse like someone someone behind it um to to obtain student loans you give it to some and you supervise and you control and you um you you can exert your influence that way so there are ways to control and i agree we cannot just forgive student debt and there would be if president biden were to take this 50 000 um you know action tomorrow there would be a push you could say beth talked about it as if there would be a push for people to say well what am i going to do now i don't need to i can take on debt because it'll be forgiven but there there also be the push for hey we need to rethink how we're doing this and it is long overdue congress needs to step in reauthorize the higher education act and actually take control of what's happening here and beth i think i'm going to give you the final word in this round sure i want to address the discussion about the social justice issue related to student debt cancellation i'm absolutely sympathetic to the concerns that our opponents have today regarding wealth disparities and disparities and opportunity across different racial groups the problem i have is that this is the wrong mechanism for fixing that problem what we see is a symptom of that problem showing up in the student loan space and the outcomes that people are facing with education outcomes and with their borrowing outcomes but we need to address that problem more directly perhaps with reparations or through grant aid on the front end of education i'm not opposed to either of those things but i'm absolutely opposed to trying to do that through this because i just think it's the wrong way to get it done okay i think i see the beginning of perhaps some common ground emerging but we're not going to be able to get into that because that concludes round two of this intelligence squared us debate where our resolution is forgive student debt now we move on to round three and round three uh will be brief closing statements from each debater in turn those statements will be two minutes each and it's their last chance to try to change your minds because right after this round again you'll be asked to vote for a second time and that vote the difference actually between the first and second vote will determine our winner so let's move on to closing statements first making her final argument for the motion forgive student debt here is ashley harrington 1.7 trillion dollars 44 million people is unsustainable it doesn't work it hasn't worked and tinkering at the margins is no longer an acceptable response when we are in an inverse in a recession and in a pandemic and this is a this is a time that none of none of us were prepared for or ever that saw coming it is no longer okay to just do the bare minimum and expect people to get along they are not getting along and our economy is impacted by it it's not just the 44 million it's their families it's their communities as our entire society and we can't get away from that yes this is not the end-all be-all solution to society's ills or even to higher education ills but it is it has to be part of the solution it is the first step that enables us to do better to create a more equitable system where everyone doesn't have to take out 30 grand in debt to get through it and where black and brown people don't have to stay in repayment for 20 plus years where interest doesn't continue to grow where people actually get to reap the benefits of their hard work and we also get to reap the benefits because it is a public good we can do so much this is the time for bold action if we can do a 1.7 trillion dollar tax cut if we can put billion hundreds of billions of dollars into small business in a way that has never been done before we can absolutely do something about the student debt crisis that is plaguing 44 million people and we can fix it so that we don't end up here again there are many ways and many of us are agreed on how to do that but the first step is canceling student debt and fifty thousand dollars per borrower will have a tremendous impact that will be felt across the board thank you ashley harrington our next statement closing statement comes from nick gillespie he will be arguing against the resolution yeah i am against uh ubiquitous or you know student loan debt forgiveness because i think it mistakes first the reality the social reality again 56 percent of people of students graduate college with student debt the typical payment is about three hundred dollars a year uh three hundred dollars a month and if i said to you i'm gonna help you boost your earnings by two hundred and fifty thousand five hundred thousand dollars a million dollars over the course of your year and you're gonna have to take out some debt that's actually a smart move and again not everybody does that and the median student debt is much lower than 30 30 000 or 300 a month we need to have a system that allows people to participate fully in higher education one sign that we're doing well on that is that consistently the number of people who graduate high school who directly enroll in some form of higher education is high it's around 70 percent and it's been creeping up over the past several decades that's a good sign we can make college cheaper and more affordable by giving grants to low-income people and people who need help we can also increase the amount of supply of higher education which never gets talked about but that's the proven way to reduce prices when there's rising demand but to say simply we're going to wipe out money that people have voluntarily entered you know into a relationship to to pay and to have is problematic um it it sets up a bad precedent it is an insult to people who have saved hard including low-income people who have saved hard and scrimped in order to go to college this is not the way forward we want more educated people we want college to be more affordable wiping out student debt in a way that will benefit particularly rich people as much or more in dollar amounts than poor people is just a missed opportunity and the wrong direction so please don't vote to get rid of student debt thank you nicole espy and we move forward with closing statements next up will be dalia jimenez who is arguing for the resolution to forgive student debt equal access to education opportunity is a civil right unfortunately we have um we have not been doing very well in giving equal access to educational opportunity nick talks about the number the amount of money that someone can expect to earn after they get a college degree well 40 of borrowers do not get a college degree 56 percent of black borrowers do not get a college degree they do not see those lifetime earnings they don't see and they never see them the number that he's talking about because that number is primarily based on white people people earning hundred thousand dollars two hundred thousand dollars a year aren't necessarily wealthy they may be but they're not if they don't have family wealth and that is primarily black and brown people who do not have family wealth i am all for grants for low-income people and changing the way that we're doing our educational funding but that doesn't help the 44 million people who had debt right now and the 11 percent were in delinquency or who were pre-covered um in 2019 a federal student borrower defaulted every 26 seconds that's more than four times the rate of mortgage foreclosures and keep in mind default in the context of a student loan means that you did not pay for nine months in theory the income driven repayment programs should mean that anyone who's struggling should not have to pay because they would not make enough money and so they might even have a zero dollar repayment that they might have to every year recertify for um 20 to 25 years we are making people jump through all these hoops and meanwhile playing duck paying debt collectors debt servicers to service all this debt that may never come in in fact we know for many of them that debt will never actually come into the books it is just wrong present by needs to forgive student debt and i hope that you will vote for this motion thank you very much dalia jimenez and finally our last argument will be against the resolution forgive student debt here is beth acres we live in an economy that's largely defined by capitalism we don't have an excess of social safety nets in this country like like we see in some others and in order for that system to be sustainable we need to have effective mechanisms for social mobility higher education college career training that is the core mechanism for social mobility in our economy and it needs to be affordable right now it's technically affordable because people have access to debt but it's not completely affordable because of the risk that it puts on individuals people need to put themselves in debt in order to make this investment and hope that it works out we need to improve the income driven repayment program so that we can assure people that college is not going to leave them worse off than where they started so there's room room to move forward in that dimension without just blowing everything up and going with a widespread student load cancellation program that's what we're against not against targeted relief people who are struggling absolutely deserve a bailout in this space because like i said higher education is just so critical to the organization of our economy in that it's the most important mechanism that people have for investing in themselves and getting to a different socioeconomic status than where they were born look it is absolutely not fun to be on this side of the debate i'm a millennial i've got friends around me who have lots of education lots of debt and this does not make me a very popular person with them but i absolutely believe that it would be the wrong thing for the country to do massive loan cancellation and so while it's an unpopular view one that doesn't make me a lot of friends it's one that i'm sticking with and i really want you to vote no that we should not cancel all the outstanding student debt in our economy thank you back bakers and that concludes the final round of this intelligence squared u.s debate and now it's time to decide uh which side you feel uh has been most persuasive we're going to ask you to cast your vote a second time and to do that by going back to iq2us.org and do exactly what you did the first time to cast your first vote you're still going to have that url open probably but if not just go back and re-enter it iq2us.org you can do that from any browser or any cell phone again iq the number two us.org to vote one more time for against or undecided so that's it the competition is over this has really been an interesting and and fascinating debate and i want to say to ashley and beth and dalia and nick thank you for uh the way that you all did this um as as you know um nick you've debated with us before and it's great to have the the other three of you joining us i hope someday we can be doing this on a live stage in front of a live audience because that energy can be terrific and the interaction even even more powerful and robust than it was here today but even with the way it was today i just want to say i appreciate how how clearly you were actually listening to each other even as you disagreed with each other that's something rare these days it's a mark of what we try to do at intelligence squared and you see to get people with opposing views to be able to talk to each other disagree make their case and do so in a respectful way it's what we do by bringing this program to millions of listeners around the world uh which we do through podcasts and television and radio and we do it all for free it's something we care a lot about here at intelligence squared which operates i want you to know as a non-profit and if anyone out there wants to learn more about what we do or watch one of the more than 200 debates we've produced so far you can do that by going to our website but as for this one to all four of you for the way you you handled this the way you heard each other out and nevertheless stood your ground and pushed back and pushed back hard but did so in a way that shed light i just want to say thank you it's a rare thing and all four of you were terrific at it so thank you to all of you thanks john as for this one i encourage everybody to check out our website iq2us.org to cast your vote and check back on april 1st to see which team won but for me that's it i'm john donven i want to thank you very much goodbye from intelligencesquared i'll see you next time you

Channel: IntelligenceSquared Debates

Views: 19,707

Keywords: Intelligence Squared, IQ2, IQ2US, Intelligence Squared U.S., debate, live debate, I2, nyc, politics, conservative, liberal, College, Student Debt, Loan Forgiveness, Forgive Student Debt, Student Loans, Pell Grant

Id: wuJB9ZohQNI

Length: 73min 2sec (4382 seconds)

Published: Fri Mar 26 2021