President Biden considers forgiving student loan debt: Here's what that means in Louisiana
"There's no question that student loan debt has become an increasingly onerous burden for many," University of Louisiana System President Jim Henderson told USA Today Network. "The big question is what's the best way to approach addressing the problem."
During his 2020 presidential campaign, Biden pledged to cancel at least $10,000 of each American's student debt.
Late last month he reiterated the promise when responding to a question from USA Today.
"I am considering dealing with some debt reduction," he said. "I'm in the process of taking a hard look at whether or not ... there will be additional debt forgiveness, and I'll have an answer on that in the next couple of weeks."
Biden didn't answer when asked what amount he's looking at canceling but said he isn't considering a $50,000 debt reduction — a number that some lawmakers said the president has the authority to forgive.
The average American student loan borrower has about $37,000 in debt, according to federal data compiled by the Education Data Initiative.
Louisiana's average debt is less at $34,500 per student borrower, but the state’s population has a higher proportion of borrowers at 14%, according to Education Data Initiative.
Following are key Louisiana findings from the Education Data Initiative's latest report this spring:
► $22.5 billion in student loan debt belongs to state residents.
► $34,525 is the average student loan debt.
► 651,700 student borrowers live in Louisiana.
► 52.8% of them are under the age of 35.
► 14.0% of state residents have student loan debt.
► Among the state’s indebted student borrowers, 17.1% owe less than $5,000.
► 19.8% owe $20,000 to $40,000 (average $28,571).
► 1.9% owe more than $200,000.
Henderson said he doesn't favor complete loan forgiveness, but acknowledged the growing student loan debt problem must be addressed.
"There are a number of models for reducing student debt moving forward, but it's incumbent on us that the debt students do take on comes with a return on investment with the ability to compete in the 21st Century economy."
University of Tennessee education Professor Robert Kelchen has said limiting the number and volume of new federal loans issued is one of the few ways to reduce future debt loads, though he said it would be unpopular.
The other approaches call more for upfront aid for students or finding ways to reduce the cost of providing an education.
That avenue, Kelchen said, is the most sustainable solution, but it’s also likely to be the least appealing to students and parents because it could mean larger class sizes, fewer academic or extracurricular opportunities for students, or older facilities.
“The only way we don’t end up in this situation again is if we do something about it,” Kelchen said. “And none of the options for doing something about it are going to be popular.”
Greg Hilburn covers Louisiana politics for the USA Today Network. Follow him on Twitter @GregHilburn1.