Debt cancellation would mostly help debtors

Canceling student debt seems like a great way to help people; heck, I’d like my debts to be canceled too (“Biden Administration Must Cancel Student Loan Debt,” Opinion, July 12). But is it really useful?

Nathaniel Hendren, professor of economics at Harvard and co-director of the Opportunity Insights Institute, has assessed student debt cancellation against a number of other social programs helping economically disadvantaged people with their return on investment and a found that writing off this debt does not bring much benefit to the rest of society.

In a video discussing his research, Hendren said, “Student loan cancellation could be of great benefit to people with a lot of debt. . . but in the end, the value for money of these policies will not come at all close to the high value for money that we see “for other government social safety net policies.

Using a measure called the marginal value of public funds, Hendren and his co-author, Ben Sprung-Keyser, analyzed the economic benefits of 133 government policies, seeking policy solutions that lift families out of poverty and to achieve better results in life. He would not recommend paying off student debt.

We need to do the math before recommending canceling student loans. There are other proven ways to help economically disadvantaged people. Debt cancellation is not one of them.

Lynn miller

Los Angeles

Refunds have been suspended, but a big bill is due

The three July 12 opinion pieces – “Biden Administration Must Cancel Student Loan Debt,” “A Truly Progressive Student Loan Policy,” and “Low-Income Students Need Bold Solutions to Get to School” ‘university and get there’ – took for granted the current system of student loans is functional. Frankly, this is not the case.

Students have not had to pay their federal loans since the start of the pandemic. This suspension of payments was meant to be short-term, but has been extended several times and will likely continue to be extended until Congress meets to reform college finances.

The White House can deflect calls for debt cancellation from those to the president’s left when no one is forced to repay their loans. But is the Biden administration prepared to spend political capital on a budget proposal that already amounts to trillions for hundreds of billions more in student debt relief? It is still unknown.

The education ministry must fear that defaults will skyrocket if the forbearance ends. The longer students do not pay, the more difficult it will be for them to get back into the habit of paying again. This part of their budget goes towards food, rent and other necessities.

Big projects, such as total debt cancellation, are often accomplished by changing realities. This may be the case with student debt reform, and in the months to come, the clock will turn again.

Bob hildreth

Boston

The writer is a co-founder of several nonprofits that work to make college affordable for low-income students, including the Hildreth Institute.