Democratic Senator Elizabeth Warren knows firsthand the importance of education.
The 2020 presidential hopeful chronicled her ascent from her humble beginnings as a school teacher, to a law school professor and Senator in a column in Medium and addressed the crisis of student debt affecting millions of families.
As a part of an ambitious policy plan, Warren declared she will be fighting for universal tuition-free colleges and for the cancellation of student debt for over 95% of 45 million Americans with student loan debt.
Her plan would waive $50,000 in student-loan debts for borrowers who make under $100,000, in addition to breaking large tech companies, and universal child-care coverage.
The debt cancellation would not apply towards those who earn above $250,000.
Her broad debt cancellation plan, she called – "truly transformational" – includes the following:
- Cancel debt for more than 95% of the nearly 45 million Americans with student loan debt;
- Wipe out student loan debt entirely for more than 75% of the Americans with that debt;
- Substantially increase wealth for Black and Latinx families and reduce both the Black-White and Latinx-White wealth gaps; and
- Provide an enormous middle-class stimulus that will boost economic growth, increase home purchases, and fuel a new wave of small business formation.
Warren detailed the consequences of exorbitant student debts that prevent families from starting businesses while their home ownership rates continue on a steep decline.
"Today, it's virtually impossible for a young person to find that kind of opportunity. As states have invested less per-student at community colleges and public four-year colleges, the schools themselves have raised tuition and fees to make up the gap."
"And rather than stepping in to hold states accountable, or to pick up more of the tab and keep costs reasonable, the federal government went with a third option: pushing families that can't afford to pay the outrageous costs of higher education towards taking out loans."
Warren is also proposing a universal free college program, that together with debt cancellation, would cost $1.25 trillion over the span of 10 years.
The Democratic candidate hopes that her ultra-millionaire tax proposal, which taxes 2% on every dollar of households with a net worth of $50 million or more, will cover the debt cancellation costs.
Warren's bold strategy was met with opposing views.
Lindsey Burke – the director of the Center for Education Policy at the Heritage Foundation, a conservative think tank – is concerned about Warren's plan's impact on tuition.
"Universities will continue to do what they've been able to do for decades, and that's increase tuition, because they [will] know there are policies like debt-cancellation and loan forgiveness. They enable universities to be as profligate as they always have been."
Tiffany Jones – the director of higher education policy at the Education Trust, a nonprofit focused on education equity – believes that the debt-cancellation policy benefiting those who need it the most is a good thing, according to The Atlantic.
However, people are concerned over the plan's focus on income over wealth. When looking at the racial-wealth gap, Warren's plan needs to be more specific to determine who needs the debt-cancellation the most.
Many Democratic candidates are addressing how student loans especially burden black students, but so far, Warren is the only hopeful who is promising to fund black colleges.
"For decades, Black Americans were kept out of higher education by virtue of overtly discriminatory policies. Even as the civil rights movement rolled back racially discriminatory admissions policies, the stratification of our higher education system kept students of color concentrated in under-resourced institutions and left them vulnerable to predatory actors."
She hopes to raise $50,000 towards historically black colleges and universities (HBCU), which have historically been underfunded.
On Monday, Warren tweeted that her new plan will give "our students a fighting chance at the American dream again."
What are your thoughts about her proposal and its long-term impact?