Let’s talk about the Feds wanting to forgive school debt.
First – the only debt they are talking about are the loans actually provided by the Federal Government.

In the “Affordable Care Act” of 2010 – there was a provision that allowed the Federal Government to guarantee student loans.

This meant that if the borrower defaulted, the US Taxpayer would foot the bill. In addition, the ACA said that student loans could not be forgiven through bankruptcy. Therefore, the only way to default – is to quit paying or die.

Following 2011 – the number of “private student loans” (ie. from banking institutions) – dropped by 90%. Which meant the Federal Government was backing almost all student loans. And, when it came to providing these loans, credit history and working status was not really considered – thus, just about everyone would qualify for Federally backed student loans.

Nice – everyone can get an education! – Still, not everyone who pays for an education – will complete the program, or get a higher paying job to pay back their loans.

What is the real reason the Feds want to pay off these loans? – Simply because, just like Social Security, the Federal Budget must carry the value of these loans – which restricts the value from being used for other purposes. Just like Social Security, and Small Business Loans – the Fed Govt must have the money available to pay these loans off.

Note: if you use equity to back a loan – you must maintain that equity or the bank may say you are in default of your loan agreement. The Feds must budget the value of the loans – which means they can’t use this potential $1 Trillion on other programs.

Personal opinion:
Think what the Democrats could do with an extra $1 Trillion? They could give it away to so many people! Sway so many votes, and build programs to continue making people dependent upon the Federal Govt they desire to control.

So where does this leave us?

First – fix the loan program. Stop giving away loans unless there is some proof the borrower will be able to pay it back. (Not everyone is guaranteed an education! – They must earn it! – as in “earn your degree?”)

Second – Put a cap on Education Costs for those who are getting Federal Loans. (Think how Medicare works – If you have money you pay full price – if you don’t you only pay a portion)

AND – don’t allow those with Federal Loans to attend Private schools – they should be required to attend State Public Institutions – after all – the State’s should be paying for Higher Education costs. (Look at Louisiana’s TOPS program – it works as long as the Democratic Governor doesn’t use it as a pawn in budget negotiations!)

Private schools should work for their income – just like private business. The Feds should not be supporting private business.

Yes – this would shut down many private schools. But those schools are just like the private businesses that live off of government handouts in other industries – such as medical and agriculture. (Just ask the Lobbyists and Dig deeper in the pork fat of budget hearings!)

Today’s technology is allowing all schools to accept that virtual education is going to be part of the system going forward (The Pandemic is seeing to this and convincing old school academics that online learning can work – if the faculty put in effort and the students have some discipline for learning – it isn’t for everyone- on both sides – but it does work!)

Third – Don’t completely forgive present student loans – but provide alternatives to help pay back the loans. Such programs as the Community Service Employment – work 10 years in government service (any local, state, federal employment) – and have the balance of loans forgiven (Only if there is a limit to loans in the first place – see above where there is a fixed amount for Federal College Loans!) – The idea of paying $150,000 to one school and only $75,000 to another for a college degree? – Really – this is like offering one person a Glass eye – or the other surgery to fix their existing eye. – Make things cost equal – and Universities will deliver equal. – If they don’t – then they can go private and charge whatever they want (see Ivy League…)

There are ways to encourage newly educated people to work in various industries – with the incentive of having their school loans reduced. This is how companies can offer benefits to highly desired potential employees! – Why can’t the Feds do the same?

Fourth – Make the Student Loan program part of Dept of Commerce and not Dept of Ed. The Dept of Ed should be monitoring elementary and secondary education – not higher education. If elementary and Secondary education are improved – then worrying about college students completing their programs may be moot (based on ability – not decision making by students in their personal lives!)

https://www.investopedia.com/…/who-actually-owns-student-lo…