Multiple democratic front-runners in the 2020 presidential election have included propositions to forgive student loans to some extent as a part of their platform. The idea that debt can be forgiven is very similar to Solon’s seisachtheia in which he wiped the debt for poor Athenians. All college students and recent graduates would be overjoyed if some of their exorbitant debt was eliminated. However, I believe the college debt situation the United States is currently in is similar to Solon’s seisachtheia in that the government’s eliminating the debts would not solve the problem long term and is a shortsighted proposition.
Although the debt accrued by graduates and dropouts alike is a huge problem, the United States shouldn’t be focusing its attention on clearing the massive debts. Instead it should be focusing on solving the root of the problem: the high price of college. Forgiven debts will not assist the next generation of Americans who have yet to start the huge debt trap known as college. The way to solve the problem, rather than just stopping the symptoms, would be to pass laws requiring lower tuition or other forms of assistance to students who will be weighed down for years by the cost of higher education. This is similar to Solon’s seisachtheia in that even though the poor no longer had debts, they still had to borrow from the wealthy and went back into debt because many still didn’t have the means to support themselves.
Another reason that the elimination of current debt would not be an effective option is that someone would have to pay for the debts, even if it was not the students. If Congress declared that all banks will be required to forgive all student debt, the trust the banks have in the government would drastically decrease. In order to recoup the extravagant losses, the banks had to bear, they would increase interest rates on future loans to account for the risk that they could be forced to forgive the new loans. This rise in interest rates would compound the current problem and make problems worse for future students. The banking industry would also take a huge hit. There’s an estimated 1.6 trillion dollars in outstanding student debt in America (CNBC). It has become an entire industry in itself. If all the debts were eliminated, many jobs that work on managing that money would disappear and leave an enormous number of people unemployed overnight.
A less extreme option that has been proposed is to eliminate the loans by paying it off with new taxes targeted towards the middle and upper classes. Taxing the rich often appears to be the best option in election promises because there are many poor Americans that would benefit and vote for the politician who supports the idea. Americans should not feel like they are being taxed for becoming successful. As it angered the wealthy in ancient Athens, high taxes would anger the present day middle class and would most likely not go away unless there is a plan to lower the rate at which students go into debt.
Elimination of student debt in the form of loan forgiveness is a great platform to get voters excited, but it would result in the same ending as Solon’s seisachtheia. As Solon wrote “Extravagant hopes in me, but now they are angry and look askance, as if I were their enemy.” (Plutarch Life of Solon, 2.16). The forgiveness of loans would not help long-term and would cause more problems after the initial debt relief.
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