Democrats have warmly embraced the idea of student loan forgiveness and seem ready to make it a key political issue both now and during the fall midterms. And a new I&I/TIPP Poll shows why: On the whole, Americans like the idea, despite its potential drawbacks.
The May I&I/TIPP Poll asked 1,320 adults nationwide four questions about student loan forgiveness; the intention was to gauge whether there was broad-based support for the idea. It was based on White House plans, still in the discussion stages, to forgive student loans up to either $10,000 or $50,000.
The poll, taken online from May 4-6, has a margin of error of +/- 2.8 percentage points.
Among those queried, 61% said they would “strongly” (40%) or “somewhat” (21%) support a plan for forgiving student loan debts of up to $10,000 for “all Americans.”
Just 30% said they would oppose such a move either “strongly” (20%) or “somewhat” (10%). “Unsure” received a 9% response.
The support was high, though not broad, varying considerably by age, race and political affiliation.
For instance, in general, older Americans don’t like the idea of student loan forgiveness. For those 18-24, a strong majority (72% “support” vs. 13% “oppose”) like the idea. For those 25-44, the comparable numbers were even higher, 78% support and 16% oppose.
But for those 45-64, support drops off to 54%, while opposition rises to 37%. And for those over 65, just 42% favor student loan forgiveness, while 51% oppose it.
Another split emerges by race. Among whites, 57% support the idea, while 36% oppose it. Among blacks and Hispanics, support is far higher at 72% support and 17% oppose.
Perhaps the least surprising result is by party affiliation: Democrats (80% support, 13% oppose) overwhelmingly like the idea, while independents (61%-33%) are also strong supporters, though with much higher opposition than the Democrats.
As for Republicans, just 41% support it and 53% oppose it.
One surprising outcome: Those having a high school diploma or less supported it 65%-24%, highest of any education group. That compares to 56%-33% for those with “some college” and 63%-33% for those with a college degree or higher.
We asked a follow-up: How about forgiving not $10,000 but $50,000 in student debts for all Americans?
While still favored by most, the margin narrowed. Just 53% supported it, while 38% opposed it. And almost across the board, support by each key demographic softened when the amount of debt forgiveness was increased.
The I&I/TIPP Poll then threw a curveball, asking respondents: “Do you support or oppose forgiving federal student loan debt for lower-income Americans in the following amounts?” The question was asked for both the $10,000 and $50,000 debt-relief levels.
Recall that the earlier questions asked about debt relief for “all Americans.”
Support increased when relief included only lower-income debtors, but not by much. At $10,000 of relief, 64% said they’d support forgiving loans for lower-income debtors, while 28% said they’d oppose it. That’s fairly close to the 61%-30% favoring giving “all Americans” relief.
And, again, raising the relief amount to $50,000 for lower-income Americans raises support only slightly to 56%-36%, compared to 53%-38% for “all Americans.”
It’s clear many Americans see this as relief for the middle class as much as for low-income Americans. That might affect how it’s sold politically, increasing chances for a broad-based forgiveness plan.
While economists generally agree that debt forgiveness is a questionable idea at best, the idea seems to have caught on with the public. Today, 43 million Americans over the age of 18 have student debts totaling an estimated $1.75 trillion, or roughly $28,950 on average. It’s not hard to see the appeal for many.
Of the total amount in loans, 92% were made by the federal government. Just 8% by private banks. So this is largely a federal, not a private, problem. Like it or not, Washington will come under intense political pressure, as it often is, to “do something.”
The cost to the taxpayers will be considerable. At $10,000 in forgiveness, it costs federal government $377 billion, covering 24% of all student debt. Increase forgiveness to $50,000, and cost jumps to $759 billion, erasing 67% of all debt.
Expect big debate over fairness.
A study by the left-center Brookings Institution noted “that almost a third of all student debt is owed by the wealthiest 20% of households and only 8% by the bottom 20%. Across-the-board student loan forgiveness is regressive measured by income, family affluence, educational attainment – and also wealth.”
Another study by the University of Chicago found that the benefits of debt relief go to the richest households. That study calculated that the top 30% of U.S. households would get nearly half of all the loan forgiveness. Those in the bottom half would get just a quarter of the relief in dollar terms.
Ironically, the current student debt payment relief enjoyed by 24 million American student-debt holders was passed by the Republican Congress in 2020, and signed into law by then-President Donald Trump. So, like Democrats, Republicans understand this is a potent political issue.
Even so, Republicans generally object to sweeping forgiveness of student loans, as recently proposed by President Joe Biden, Sen. Elizabeth Warren, and others in the progressive wing of the Democratic Party.
“Student loan socialism would be a giant slap in the face to every family who sacrificed to save for college, to every graduate who paid their debt, to every worker who made a different career choice so they could stay debt-free,” Senate Minority Leader Mitch McConnell said recently.
And an even larger question of fairness looms.
“Forgiveness proposals would unfairly foist a borrower’s debt onto strangers, including those who made a conscious decision not to attend college to avoid debt or to go to a school they otherwise wouldn’t have because it was less expensive,” wrote Lindsey M. Burke, director of conservative-leaning Heritage Foundation’s Center for Education Policy. “At the same time, it would almost certainly lead to the cost of college increasing for future students.”
Each month, I&I/TIPP publishes timely and informative data from our polls on this topic and others of interest. TIPP has earned a reputation for excellence by being the most accurate pollster for the past five presidential elections.
Terry Jones is an editor of Issues & Insights. His four decades of journalism experience include serving as national issues editor, economics editor, and editorial page editor for Investor’s Business Daily.