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Breaking the Chains: Proposed Solutions to the Student Loan Crisis

The Broken Student Loan System: Ongoing Issues and Proposals for Change

In recent years, student loans have become one of the largest burdens for Americans throughout the United States. Due to rising tuition costs, students are forced to take out increasingly larger loans just to attend college, leaving them with an immense amount of debt that can often take years, if not decades, to repay.

As a result, many borrowers struggle to make ends meet and maintain their financial stability, while the rest of the economy is affected by the impact of the student loan crisis. This article will explore the main issues affecting the student loan system and the proposed solutions from policymakers to address this problem.

The Student Loan Pause Extension and Cancellation

Earlier this year, the federal government extended the student loan pause until September 2021, giving borrowers a much-needed reprieve during the COVID-19 pandemic. However, while this pause may have helped in the short term, it has not addressed the underlying issue of student loan debt.

Senator Patty Murray has proposed a four-point plan that would help tackle this problem directly. Murray’s plan, which focuses on canceling student loans, would help borrowers immensely.

Many borrowers have struggled to make payments on their loans due to the pandemic’s financial toll, impacting their credit history negatively. Murray’s proposal includes the clearance of such negative credit history, allowing borrowers to get back on their feet.

Additionally, it recommends income-driven repayment plans to make payments more manageable for those who are struggling. The plan also calls for more forgiveness, meaning borrowers could have the possibility of having their loans completely forgiven.

Ultimately, Murray has proposed that loans be canceled entirely or at least the amounts be significantly reduced.

Student Loan System Issues

Despite Murray’s proposed plan, it is vital to consider the larger flaws in the student loan system that led to this crisis in the first place. The most significant problem lies in the rising cost of tuition, which has far outpaced inflation.

As tuition expenses continue to rise, students are left with no option but to take out more loans. This cycle becomes exhausting for borrowers, resulting in larger debts, and ultimately prevents them from achieving financial success.

The impact of this broken system falls most heavily on poor and minority students who often face the most significant financial burden. The burden of student loans affects borrowers of color significantly, given pre-existing wealth inequality in the United States.

The unequal distribution of funding for low-income schools means that students from these schools often need more student loans. Despite the fact that minimum wages have not kept pace with inflation, tuition costs have kept increasing, causing an even greater burden on students’ debt repayment.

Impact on Borrowers

Students who are struggling to pay off these loans face many challenges, both financial and personal. The burden of student loan debt can inflict severe emotional distress and increase the likelihood of mental health issues.

The inability to pay off student loans can lead to ruined lives, financial instability, and actually hold people back from their dreams. Loan repayment plans are not intuitive, and often, borrowers are lost in the system.

Students struggle to choose the best repayment plan, resulting in defaults and further damage to their credit history. It is saddening to hear multiple stories of student loans remaining unpaid decades after their graduation, leaving them with no financial security whatsoever.

Proposed Solutions for the Future

Several policymakers have proposed solutions to address the current student loan crisis. Murray’s plan is a start, bringing important highlighted points to address the significant issues that high debt burdens place on borrowers when it comes to accessing resources to improve their credit score.

Another proposed solution includes canceling student debt for borrowers in exchange for public service, ensuring a more significant impact in low-income areas. Additionally, the widespread adoption of apprenticeships as part of the education system is becoming more popular as a solution for potentially avoiding student loan debt altogether.


As illustrated by the discussion above, the student loan system is highly flawed and affects many individuals, ruining their lives and finances. While the proposed solutions seem significant, it remains to be seen whether they will be implemented or merely stay as suggestions.

Policymakers must take this problem seriously, proposing solutions that would make education accessible and affordable to everyone, regardless of their socio-economic status. Until significant change occurs, the student loan system will continue to be a barrier for many Americans to achieve American success we all hope for.

Let us hope for policymaker implementation and a more positive future for those struggling under student loan debt. Resistance from Lawmakers and Urging Biden to Consider Murray’s Plan

While Senator Patty Murray’s plan to address the student loan crisis has gained support in some circles, there are also those who have opposed it.

Additionally, while President Biden’s recent action to freeze student loan repayments during the COVID-19 pandemic has been widely praised, some lawmakers have criticized it as irresponsible and unsustainable. Despite these challenges, Murray has continued to urge the Biden Administration to consider her plan, emphasizing the pressing need for change in the student loan system.

Opposition to Murray’s Plan

One of the notable challenges to Murray’s student loan plan comes from Congress, with some members of the U.S. House of Representatives expressing opposition to the proposed legislation. Rep.

Virginia Foxx, a Republican from North Carolina, has been one of the most vocal critics of Murray’s plan. In an op-ed for The Hill, Foxx criticized Murray’s proposal to extend the repayment freeze, arguing that it goes against the principles of responsible fiscal policy.

Foxx claimed that the repayment freeze would only prolong the burden for borrowers, exacerbating the problem in the long run. Instead, Foxx argued that the focus should be on helping students avoid debt in the first place and promoting policies that encourage fiscal responsibility.

Criticism of Biden’s Policy

President Biden’s decision to freeze student loan repayments has also faced opposition from some lawmakers, particularly in regards to the administration’s handling of the policy. Specifically, some members of Congress have criticized the lack of clarity around when the repayment freeze will end and what will happen when it does.

Foxx, for instance, criticized the Biden Administration’s handling of the policy in a statement, saying that they were “holding borrowers hostage” by not announcing a clear end date for the repayment freeze. Additionally, some lawmakers have questioned the administration’s decision to extend the freeze rather than implement more substantial reform.

Urging Biden to Consider Murray’s Plan

Despite these challenges, Murray has continued to champion her plan and urge the Biden Administration to consider it. In a recent op-ed for Forbes, Murray emphasized the critical need for change in the student loan system, particularly given the ongoing public health and economic crises.

Murray urged the administration to extend the current student loan pause and debt forgiveness programs to provide much-needed relief for struggling borrowers. She also pushed for more significant reforms, such as expanding access to income-driven repayment plans and providing forgiveness for low-income borrowers.

Murray emphasized that these changes were crucial not only for individual borrowers but also for the overall economy, given the significant impact of the student loan crisis. She also called on Congress to take action to fix the student loan system, working alongside the administration to implement meaningful reforms.

Need for Change

As Murray and other policymakers have noted, the student loan system is in dire need of change. The current crisis is not only affecting individual borrowers but has broader implications for the economy and public health.

Therefore, it is imperative that the Biden Administration considers meaningful reform, including elements of Murray’s proposed plan. Policymakers must consider the pressing need for change and work together to find sustainable, long-term solutions for the student loan crisis.

Final Thoughts

The challenges facing the student loan system are complex, with no easy solutions. However, as Murray and other policymakers have emphasized, the pressing need for change is clear.

By implementing meaningful reform that addresses the root causes of the problem, we can ensure that education is accessible and affordable for all, regardless of their socioeconomic status. Potential Solutions for the Student Loan Crisis:

Income-Driven Repayment and Forgiveness, and

Canceling Loans for Certain Borrowers

The student loan crisis in the United States continues to grow as tuition costs continue to skyrocket.

With no easy fix on the horizon, policymakers have proposed several solutions to address the issue. Two potential solutions being considered are income-driven repayment plans and loan forgiveness programs for certain borrowers.

These solutions aim to provide greater financial security and relief to borrowers, particularly those who have been disproportionately impacted by student loan debt.

Income-Driven Repayment and Forgiveness

One potential solution to address the student loan crisis is through income-driven repayment plans. One of the significant barriers to student loan repayment is the overwhelming sense of financial burden for borrowers, who often do not have the means to keep up with their payments.

The income-driven repayment plan would offer assistance to borrowers by capping monthly payments at a percentage of their income, making it more affordable and manageable for people struggling with finances. Currently, there are four major federal repayment plans available, including the Income-Based Repayment Plan (IBR), the Pay As You Earn (PAYE) plan, the Revised Pay As You Earn (REPAYE) plan, and the Income-Contingent Repayment (ICR) plan.

However, navigating the options can be confusing, and many borrowers have difficulty finding and enrolling in the right plan. To address this, policymakers are suggesting simplifying the enrollment process by creating a single, streamlined option that would be easier to understand.

This would make it easier for borrowers to access these plans, allowing them to stay on top of their payments and avoid default. Another proposal is for the government to offer federal waivers for the student loan debt of borrowers who have made consistent payments under an income-driven repayment plan.

After making payments for a specified period, a borrower’s loan balance would be forgiven. The length of time before a borrower’s payment is forgiven varies depending on the program.

However, typically, the forgiveness period ranges between 20 and 25 years. Many borrowers who have been negatively affected by student loan debt often have trouble saving or investing for the future.

This solution would offer financial respite to borrowers who have fallen into insurmountable debt, making it more feasible for them to plan for the future.

Canceling Loans for Certain Borrowers

Another potential solution to address student loan debt is canceling loans for particularly vulnerable groups of borrowers. Low-income borrowers, for example, have been hit hardest by the student loan crisis.

Policymakers have suggested canceling these borrowers’ debts after twenty years of payments. Additionally, borrowers who leave college without a degree or credential are more likely to struggle financially, with larger debts than someone who earned a degree.

These borrowers should have assistance in the form of debt cancellation after timely payments. Research has also shown that student loan debt disproportionately affects people of color.

Therefore, policymakers suggest student loan debt cancellation for people of color within a specific income bracket. This solution would involve canceling some portion, if not all, of the loan balances of people of color depending on how it could be administered.

Canceling loans for these groups would provide much-needed financial relief, allowing them to move forward and giving them an opportunity for economic mobility. At the same time, it would also have positive consequences for the economy, as it would increase consumer spending and stimulate economic growth.

Final Thoughts

Student loan debt has become a significant issue in the United States, making it challenging for graduates to achieve financial freedom even years after graduation. Policymakers have proposed several solutions to address this crisis, including income-driven repayment plans, simplified enrollment processes, and loan forgiveness programs for certain groups of borrowers.

Thoughtful and substantial solutions have to be implemented to put an end to borrowers’ financial struggle. These solutions would give borrowers financial relief, making it easier to plan for the future and maintain their financial stability.

It is critical that policymakers prioritize these solutions to provide economic mobility for future generations. The student loan crisis in the United States poses a significant problem for borrowers, preventing them from achieving financial freedom.

Policymakers have suggested a few potential solutions to ease the burden, including income-driven repayment plans, loan forgiveness programs, and loan cancellation for certain vulnerable groups of borrowers. With the implementation of thought-out solutions, borrowers can find financial respite, giving them an opportunity for economic mobility.

As such, policymakers must prioritize these solutions to provide financial relief for struggling borrowers, ensuring a brighter future for people regardless of their income level, and further expanding our economy.

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