Equity vs. Equality: Examining arguments for and against the fairness of forgiveness

March 29, 2023


Melissa Vial

Debt forgiveness can provide assistance to those with low financial backgrounds.

Should the federal government strive for equity, making sure that everyone gets what they need to succeed? Should the same government strive for equality, working to give all of its citizens equal opportunities and resources? Some might be tempted to answer both questions in the affirmative. After all, creating equity and equality sounds like a great way to help people across the nation.

What happens, though, when both equity and equality cannot coexist — when one must be chosen over the other? That question is at the core of one of the biggest debates in U.S. politics today: should we forgive student loan debt?

Advocates for forgiveness often invoke equity in their arguments, saying that loan relief will help the people who most need such assistance, creating equitable economic footing for more Americans. Meanwhile, people who are opposed to forgiving student debt tend to focus more on equality. They point out that many Americans have worked hard to pay off their student loans. Would it be fair for those Americans’ tax dollars to fund other Americans’ pursuit of debt relief that they have already independently achieved?

In order to better understand this debate, it is important to understand who exactly will receive student loan relief if President Joe Biden’s plan is allowed to go into action, pending current court challenges. Foremost, the plan would target low- and middle-income families, according to the Biden administration’s classifications. Specifically, people who earn an income of $125,000 individually or $250,000 as a couple or head of a household could qualify for student loan forgiveness. From there, forgiveness would be doled out based on Pell Grant status. Pell Grants are financial awards that the government has long used to aid low-income undergraduate students. So, if loan forgiveness applicants previously received a Pell Grant — and thus have likely endured greater financial hardship — they will receive $20,000 in loan relief under Biden’s plan. For people who did not receive a grant but do meet the income threshold, $10,000 in relief would be available. And, critically, all of this aid would be administered “up to” applicants’ remaining debt levels. So, if someone would qualify for $10,000 in relief but only has $8,000 left in loans, they would only receive $8,000 in government assistance.

It may be that last point that is most controversial. Many older Americans have already paid off most or all of the student loans they took out. For them, this whole initiative could feel like a burden. They worry about the national deficit, which would increase by $400,000,000,000 under Biden’s plan, according to the Congressional Budget Office, and whether it will ultimately be their tax dollars financing that debt.

“Essentially, the debt burden is shifted off of the shoulders of those who signed the loans and onto everyone who pays federal taxes. If you’re like me, that’s fundamentally unfair,” said columnist Matthew Noyes in writing for the Foundation for Economic Education, a conservative think tank.

In addition to concerns like those of Noyes, who paid off his loans already, worries could exist among current, younger students. While many current college students can access Biden’s relief plan, current college freshmen cannot. Additionally, the Biden administration has stressed — mentioning it five times on the studentaid.gov website — that this is a one-time forgiveness program. Where does that leave the students who have not yet attended college? Without fundamental changes being made to education financing in America, it seems likely that student loan forgiveness could become necessary for millions of young people once again in years to come.

However, not all people are focused on those, young and old, who will not receive help from Biden’s current plan. Advocates for debt relief prefer to focus on who the program can help.

“I paid off all my student loans. I still support student loan forgiveness,” read the title of one opinion essay on the subject, published by David Goldstein for Vox in 2019. In the essay, he called arguments against the fairness of student loan forgiveness, “the kind of argument designed to tug at our most selfish impulses while ignoring the economic and political transformations that have left a generation of college graduates struggling under an unprecedented mountain of student debt.”

On both sides of the debate over student loan forgiveness, passions run high. Such is often the case when large sums of money are at stake. As Americans consider whether or not they support Biden’s plan, they have a lot to consider across a broad spectrum of issues that affect people of all ages.

Is student loan forgiveness equitable? Is it unfair and unequal? Could it be all of the above? The answers to those questions are up for debate, and the consensus Americans reach will have major implications for generations to come.

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