Given the incredible rise in college costs and a collective outstanding student debt in the US approaching $1.3 trillion, 2016 Presidential candidates are beginning to address this issue in hopes of gaining elusive millennial votes. Millennials have been particularly hard hit by student loans on top of a recession and are keenly interested in what politicians propose to ease the burden on either future or current student loan holders. Several candidates have released at least partial proposals.
Hillary Clinton (Democrat) — Clinton has proposed federal incentive grants to states that are targeted at public four-year colleges and universities. Known as the “New College Compact,” the program will be intended to make public schools affordable without loans if students can contribute the effective equivalent of ten hours per week in wages and families can make an as-yet to be determined “affordable and realistic” contribution.
Other aspects of the plan include lower interest rates for new student loans and including the ability to refinance existing loans, allowing Pell Grants to be used for living expenses, simplifying and expanding income-based repayment methods, and introducing institutional risk sharing. The $350 billion in costs over 10 years will be covered by “limiting certain tax expenditures for high income taxpayers.”
Bernie Sanders (Democrat) — Sanders was one of the first candidates to target college costs and has sponsored a bill to award state grants that eliminate tuition and fees at public universities and colleges. Sanders is also in favor of guaranteeing more affordable loans and allowing refinancing of existing loans. The estimated cost is $470 billion over 10 years, paid for by a tax on securities transactions.
Marco Rubio (Republican) — Rubio has proposed a “Student Investment Plan” through approved private investment groups. Students would pay a set percentage of income post-graduation for a set period of time. In a similar vein, Rubio also prefers automatic income-based repayments.
Rand Paul (Republican) — Paul addresses college costs through the tax code. He advocates making college expenses tax-deductible for whoever is paying the expense, letting students with debt deduct more, if not all, of their incurred student loan interest charges, and allowing unlimited savings in tax-beneficial college savings accounts.
Martin O’Malley (Democrat) — O’Malley advocates a debt-free education at all public colleges and universities within five years, while freezing tuition rates. Income-based repayment would become automatic with the right to opt-out. Federal matching grants would be used to increase state funding.
John Kasich (Republican) — Kasich is addressing the cost side instead of the payment side. The campaign intends to help colleges and universities control their own costs to avoid the need for tuition hikes, but there are no details yet on how he would accomplish that at the federal level. In Ohio, his approach has been to recommend steps like privatizing non-academic assets and eliminating low-enrollment courses, and threaten to “take the ax” to non-responding schools.
Other candidates have issued single statements on college costs and student loan topics — such as Republicans Mike Huckabee and Lindsey Graham — supporting the ability to refinance student loans, but most candidates have not come out with a comprehensive policy. Policies will most likely be refined once the primary season has passed and the party platforms can coalesce around a single candidate.
Former Hewlett-Packard head and Republican candidate Carly Fiorina has reportedly stated she believes the student loan industry must be simplified, and that the federal government should back out of the student loan business, letting private competition among lenders create more favorable deals for students.
Ben Carson, another Republican in the crowded field of GOP candidates, has shifted the spotlight onto the students themselves, arguing he would help remove the stigma of working before college to save up money, and otherwise reportedly saying they should just make better decisions about what education they can afford.
What of the Republican frontrunners former and current, Jeb Bush and Donald Trump? As of this writing, the majority of Bush’s education issues concern pre-collegiate education and his support of Common Core. As for Trump, he has not released any policy about college costs or student debt that we are aware of. He did say he wants the government to stop profiting on student loans and that his administration would create the jobs necessary to put new graduates to work.
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