Student loan debt in the United States now totals $1.5 trillion, and it keeps rising. This is a massive burden for students and graduates and holds back the entire US economy. Because of increasing tuition and student loan debt, the number of students attending college has declined for seven years in a row. A lack of a skilled, knowledgeable workforce severely harms the ability of the US economy to compete on the global stage.
Presidential candidate Elizabeth Warren has proposed that we cancel, or pay off, the student debt of 42 million Americans. There is no free lunch — the money must come from somewhere, or someone else. My proposal allows those with student loan debt to reduce their loans by volunteering for public service, in the Peace Corps, Americorp, the military, as a teacher or a doctor in underserved communities. In other words, a reduction in student loan debt should be earned, not given away. It is unfair to those who have paid off their student loans to cancel the debt of those who have failed to reduce their loans.
About 3.5 million students graduate from high school in the US every year. Of those graduates, only about 100,000 go into national service in the military, Americorp or the Peace Corp. That is a meager 3%.
The military is always struggling to obtain high-quality recruits. Americorp and the Peace Corp could do so much more good in the US and around the world if they had more participants.
We should provide an economic incentive to volunteer for the military, Peace Corp and Americorp by providing loan payoffs for every year of service. After World War II, Congress enacted the GI Bill that gave military veterans living expenses and tuition for college. Ten years after World War II, a total 7.8 million veterans used GI Bill educational benefits to advance their civilian careers and drove the US economy to all-time highs. Most historians and economists have found the GI Bill to have been a major political and economic success.
A new GI bill is now in effect that pays for veterans’ college expenses in a similar way that the original GI Bill did after World War II. The main provisions of the act includes funding 100% of a public four-year undergraduate education to a veteran who has served three years on active duty since Sept. 11, 2001. However, unlike the original GI Bill, no living expenses are included.
We should expand the current federal law to provide similar benefits for those volunteering for Americorp, the Peace Corps and other public service. In addition, the law should provide student loan forgiveness to those who become public school teachers, as well as nurses and doctors who work in rural communities underserved by the medical profession.
If you are one of the patriotic and selfless Americans who volunteer for the Peace Corp or Americorps you should get assistance with college and/or apprenticeship training costs. Now, on the PeaceCorp’s website, the US government says “Student loan benefits. Student loans are your responsibility while you are in service.” In other words, concerning college loans, “you are on you own.” Good luck with that.
Effects on the Economy
If we can cut student loan debt significantly, college grads and those who attended apprenticeship training will see their disposable income rise dramatically. Home sales, car sales, and consumer product sales will take off.
A new National Service Program will cost the US government about $10 billion per year. This is based on a cost of $20,000 per person for 500,000 graduates. The total of federal spending is about $4 trillion a year. This National Service Program represents a minuscule 0.25% of the budget. However, the military already pays for more than half of this. If every high school graduate participated, the cost would rise to $70 billion per year, still a small price to pay for the benefits.
We know the costs. But what are the benefits? Domestically, Americorp will help teach those in underserved communities. Americorps will also help rebuild inner cities and rural communities that have been devastated by abandoned factories, by floods, earthquakes, fires and other natural disasters.
An expanded Peace Corp will help impoverished communities around the world, including those in Guatemala, El Salvador and Honduras, the source of hundreds of thousands seeking asylum in the United States. If those communities are improved, potential immigrants from those countries will stay in their native lands. Americans will be seen by the world as those who helped countries develop, not hindering refugees from impoverished lands.
The economy will improve dramatically as those burdened by student loans will begin to buy homes, cars and appliances. Removing the yoke of student debt will liberate a new generation to generate new jobs and businesses. The original GI bill led to massive economic growth in the 1950s. This new National Service Program will lead to rebuilding the depleted middle class and expand prosperity.
Joel D. Joseph is a civil rights attorney and chairman of the Made in the USA Foundation, a non-profit organization dedicated to promoting American-made products. Email joeldjoseph@gmail.com. Phone 310 MADE-USA
From The Progressive Populist, July 1-15, 2019
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