Recent Changes to Student Loan Policy and Future Recommendations

Robert H. Scott, III (), Joseph N. Patten () and Kenneth Mitchell ()
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Robert H. Scott, III: Monmouth University
Joseph N. Patten: Monmouth University
Kenneth Mitchell: Monmouth University

Chapter Chapter 4 in Bait and Switch, 2023, pp 99-125 from Springer

Abstract: Abstract In Biden v Nebraska (2023) the US Supreme Court struck down President Biden’s Executive Order to unilaterally cancel $442 billion of student debt as a presidential overreach of his constitutional powers. The debt cancellation plan would have eliminated student debt for 20 million borrowers and substantially reduced student debt for another 23 borrowers. In this chapter, we highlight how recent reforms to the Income-Driven Repayment (IDR) plan will cancel $500 billion of debt and how these reforms will fundamentally transform the student loan system. We also propose several new reforms to the student loan system that we believe will particularly help Black and first-generation student borrowers out of the student debt trap and narrow the racial wealth gap. Specifically, this chapter recommends the creation of childhood trust funds (i.e., baby bonds), banning for-profit colleges from receiving federal aid, bankruptcy reform, and requiring colleges to absorb some of the costs of student loans.

Keywords: Biden v Nebraska (2023); Income-Driven Repayments (IDR) plans; Baby Bonds; For-Profit Colleges; Bankruptcy Law (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-031-46375-4_4

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DOI: 10.1007/978-3-031-46375-4_4

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