The 2016 Presidential Candidates Student Loan Plans

The 2016 Presidential Candidates Stance on Student Loans

The upcoming 2016 Presidential Election is shaping up to be a big one, with some of the heaviest-hitting politicians (and arguably the biggest reality TV star) in history.

But where do the candidates stand on the student loan debt crisis? If you’re like me, and you’ve been watching the debates for both sides waiting for someone to take a firm stance on student loan debt, and present a solid plan for dealing with it, then you too have probably been majorly disappointed.

The GOP candidates haven’t even uttered the phrase “student loan debt” (not that I can remember at least), and the Democrats have barely given touched on this extremely important issue either.

But, by reading between the lines, we can get a pretty good idea on where each of the candidates stand. The rest of this post seeks to present their student loan debt platforms so that you can make a more informed choice about who you want leading our country from 2016-2020.

Republican Candidates Student Loan Plans

The Republican candidates haven’t spoken out much on student loan debt, and haven’t covered the issue at all in any of their debates.

I see this as a major weakness for the Republican field, especially because student loan debt is arguably the biggest issue for millenials and Gen Xers, who make up a significant portion of the potential voting population.

It may be true that most of the young people in American don’t vote, but they MIGHT if they were hearing the right messages from the presidential candidates, especially if someone were to take up the banner and begin battling for more effective student loan relief.

Here’s where each of the Republican candidates stands on student loans:

Donald Trump

Trump is definitely the 10,000 pound gorilla in the room, collecting the most media attention (for better or worse), and completely open on many controversial issues, but he hasn’t yet announced any official plans on dealing with student loan debt.

Donald Trump’s stance on student loans, however, is quite clear, because in an interview with The Hill this July, he said “That’s probably one of the only things the government shouldn’t make money off – I think it’s terrible that one of the only profit centers we have is student loans.”

And to tell you the truth, I couldn’t agree with him more! One of the biggest problems in the escalating cycle of never-ending increasing student loan debt is the fact that the Government keeps doling out the money so easily, to people who wouldn’t qualify for a private loan, and who are especially unlikely to be able to pay their debt back.

In accordance with the flood of easy money, colleges and universities continue to raise their tuition rates and other fees, since they know they’ll be able to get the cash, whether or not their students will ever actually be able to pay back their loans.

Donald Trump has also stated that he’s open to public refinancing on Federal student loan debt, which is one of the biggest policy objectives of someone who could easily become his arch-nemesis were he to get elected – Massachusetts Senator Elizabeth Warren.

Trumps student loan views are interesting because he appears to be taking a unique stance on the issue, and one that is not at all in lockstep with the Republican party, or the rest of the Republican candidates. I’m excited to see what The Donald would be able to do for student loan debtors, and I’d like to hear more about his specific plans for tackling this enormous problem.

Ben Carson

Ben Carson is another interesting candidate; a political outsider who’s day-to-day life has been spent operating as a world-leading neurosurgeon. Who better than a brain surgeon to jump start the process of reforming student loan debt?

Carson’s stance on student loans is to start holding colleges and universities accountable for the interest part of the payments on student loan debt, which would mean that students themselves are only responsible for paying back the principal balance of their loans.

To tell you the truth – in a lot of ways, I absolutely love this idea. If all that graduates had to pay back was the actual amount of money that was borrowed in the first place, then I think the whole excessive student loan debt problem would be wiped off the map in an instant. It’d be quite difficult to get absolutely buried in debt, and we wouldn’t have situations where people are paying tens of thousands of dollars toward their debt, but not making any headway toward getting it actually paid back in full.

However, the problem with this idea is it’s actual application in the real-world, and the repercussions we’d likely see if it were to be implemented. I think that colleges and universities (who are businesses at the end of the day) would simply raise their tuition rates to cover whatever interest costs they’re anticipating having to pay, forcing students to borrow even more money than before.

I’m not an economist, so maybe I’ve got this one all wrong, but if you ask colleges and universities to take on a share of the student loan debt, I don’t think that Ben is right about his idea that this would force them to rein in the costs of earning a degree. I think it would have the opposite effect, forcing them to raise prices even more, so that they’d be able to cover these new additional costs.

It’s an interesting idea, but I’m not sure that it’s a good one. I haven’t found any economic experts covering this stance in great detail yet, but as soon as I do, I’ll write an update to let everyone in on whether or not it sounds like his Ben Caron’s student loan platform will help, or hurt.

Jeb Bush

Jeb Bush is a much more traditional Republican, and he appears to be towing the standard Republican party line when it comes to student loan debt.

Jeb Bush’s stance on student loans is that he wants to push for a more “market-oriented approach” that he claims will lead to more accountability for higher education companies (colleges and universities), and lower costs for the consumer.

Reading between the lines, his approach seems to be the exact opposite of Donald Trump’s, in that Jeb seems to want to get the Federal Government out of student loan lending entirely (that’s the only way I think you can interpret the “market-oriented” part of his stance).

I’m not so sure that Jeb’s opinion on student loan debt is the right one, because I think he’s failing to realize that there is a massive student loan debt bubble that could burst at any instant, raining down all sorts of havoc on the rest of the wider economy.

Also, while I like the idea of changing the way the Federal Government handles lending out money for student loans, I do not at all like the idea of the Federal Government abandoning the sector entirely. In my opinion, all that would do is push more people into the predatory private lending market, which is going to bury even more people under a mountain of insurmountable excessive debt.

We’ll see though – perhaps Jeb’s stance on student loan debt is more nuanced than I’m currently thinking, and maybe his position will be further explained in the near future.

One thing’s certain in my mind though; if I were Jeb’s political adviser I’d be pushing him to dump the “low energy” label by taking a very serious stance on student loan debt reform and offering a significant student loan debt relief package, which should galvanize support from younger voters and could potentially build a great deal of excitement and momentum for his lagging candidacy.

Marco Rubio

Marco Rubio is the establishment candidate in this election, and apparent darling of the GOP. Personally, I’m not a fan of his, but he did propose an interesting platform for dealing with student loan debt back in 2014.

Called the Dynamic Repayment Act, this proposal clearly indicated Marco Rubio’s stance on student loans, and would have enrolled all Federal student loan debt borrowers into a new program that let them pay just 10% of monthly earnings toward their student loan debt.

The program didn’t make it, and in reality, it’s probably a good thing, because President Obama’s Pay As You Earn Program offers similar Income-Based Student Loan Repayments, and probably accomplishes just as much as Rubio’s slated proposal would have.

I do like the fact that Rubio said that “No one should be forced to go broke because they choose to go to college”, but I think this is typical political lip service, and I don’t really trust that Rubio has the student’s best interests in mind.

If you want my opinion on Rubio, I think he’s a pocket politician, bought and owned by the rich elite, working for special interests and the traditional Republican fundraising sources that are essentially the enemy to anyone with outstanding student loans: banks, rich investors and other high rollers who are getting rich off the excessive interest collected on student loan debt.

I mean, seriously, would you want this guy, who can’t even get through a 45 second speech without stopping to awkwardly take a sip of water running the country?

Maybe I just don’t like Rubio, but when he says things like colleges should tell students “how much you can expect to make when you graduate from that degree from that school”, I just don’t feel like he has a clue about how to actually deal with the problem of excessive student loan debt.

What college could possibly predict how much each of its graduates would make? And what applicants would actually listen to those predictions anyway?

OTHER REPUBLICANS HERE:
http://www.cnbc.com/2015/10/27/gop-candidates-on-retirement-and-student-debt.html

Chris Christie

I like Chris Christie, but I don’t think he’s got the right idea for how to handle student loan debt. Perhaps he just hasn’t announced his complete platform on the topic yet though, because all I can find are disparate quotes about incremental issues.

For example, Chris Christie’s stance on student loans sounds pretty myopic when he says that Congress should “properly fund and expand” college loan financial aid programs for low-income students, which is a decent idea… but what about existing debt?

While Christie appears to be concerned that Perkins Loan funding has been reduced by 54% in the last ten years, which he mentions hurts those students facing “exceptional financial need”, I can’t seem to find anything about his opinion on what to do with existing student loan debt, how to handle repayment or forgiveness, or anything about the rising costs of college education.

Honestly, I like the guy, but I don’t think he’s taking student loan debt seriously.

Rand Paul

I like Rand Paul too (not as much as I liked Ron Paul), but he’s got a controversial history with student loans and student loan debt.

A few months back he seemed to be the new champion of student loan debtors by proposing to make the cost of college tuition tax deductible – which would be HUGE – but he’s also voted against bills seeking to allow Federal student loan holders to refinance their debt at lower rates, and he’s supported bills that proposed freezing funding for Pell Grants.

As a Libertarian, I’m not surprised by older stances, but I wonder how dedicated he is to the idea of reforming the student loan system and pushing as hard as possible for that tax deductible update for college tuition. If he really stood behind that and made it a priority issue, anyone with student loan debt would need to seriously consider casting their vote for him.

Carly Fiorina

Mike Huckabee

Ted Cruz

John Kasich

Democratic Candidates Student Loan Plans

The Democratic Presidential candidates have been much more open about their views on student loan debt (maybe because a huge portion of the college and recent-college graduate population votes for them?), and some of their proposals are actually worth getting excited about.

To tell the truth though, it seems like the Democratic race is pretty much wrapped up, with Hillary Clinton being the only real viable option for the Dems, as I don’t think self-labelled “Socialist” Bernie Sanders stands a snowball’s chance in hell of getting himself elected.

Below you’ll find a breakdown of Hillary’s and Bernie’s stances on student loan debt.

Hillary Clinton

Higher is basically the only candidate with a published, comprehensive plan for what she wants to do to tackle the student loan debt crisis, and her plan is a bit of a mixed bag in my opinion.

Published back in August, 2015, her plan is called “The New College Compact”, and the thrust of what she wants to do is summarized in the following quote from one of her speeches: “No family and no student should have to borrow to pay tuition at a public college or university. And everyone who has student debt should be able to finance it at lower rates.”

While I like the idea of allowing Refinancing for Federal Student Loan Debt, I don’t think Hillary’s other major tenet of her plan is ever going to happen in America. Remember, this is not a Socialist state, where we pay 40-60% in taxes, and get free education as a result.

How realistic is this idea that no student in America would have to borrow to attend a public university? I went to a public school (University of California at San Diego), and I definitely had to borrow to cover all my costs. Basically everyone I knew did too.

What about the people who have zero dollars? What about the extremely rich people who can easily pay for their college education? Do we really want to make college free? Won’t that just water down the dedication that people have when they attend school?

Part of Hillary’s plan involves reducing future student debt by offering grants to states who promise to reinvest that money in their public schools, allowing poor students to attend the school and pay a wage-based tuition rate, without having to take on any debt.

Personally, I see no way in hell that this could ever be enacted, considering how large and powerful the banking, lending and college and university lobby’s are (and believe me, they are going to HATE this plan because it ruins their gravy train!).

Hillary has also proposed making community colleges entirely free, which I think is a great idea. If I had to do it all over again, I would have attended a community college to reduce the amount of money spent on earning my degree, and I would recommend that anyone considering going to school do the same thing.

Finally, Hillary Clinton’s student loan debt plan also includes significantly reduce interest rates for existing Federal student loans (which is great!), and simplified the income-based Federal repayment plans to make them easier for borrowers to understand.

Perhaps the biggest problem to Hillary’s stance on student loans is that this plan comes with a $350 billion price tag, which is obviously going to cause a lot of ruffled feathers, and especially because Hillary has proposed funding it by increasing taxes on the wealthy.

Even if Hillary were to get elected, I don’t think this plan has much of a shot at getting approved, but we can keep our fingers crossed that certain parts of it get passed (like the refinancing option, and free community colleges).

Bernie Sanders

Bernie Sanders doesn’t just call himself a Socialist; he really is one. That much is obvious as soon as you inspect his plan for dealing with the student loan crisis, which calls to making higher education entirely free by requiring schools to meet the financial needs of low-income students.

Bernie Sander’s student loan debt plan would provide low-income students with state, federal and institutional financial aid to pay for their tuition expenses, living expenses and any other expenses.

He’s also come out in favor of significantly expanding Federal student aid programs, proposing to “more than triple the federal work-study program to build valuable career experience” that will help graduates do better in the workforce.

I’d be ok with providing tuition benefits to those students willing to work for them (perhaps by volunteering in AmeriCorps, the Peace Corps, or some other Civil Service Program), but I am staunchly opposed to the idea of giving money or other assistance away entirely for free, especially to kids who have no idea how to set a budget, no understanding of how taxes work, and no real appreciation for what we’re doing for them.

The last segment of the population who needs a handout are the 17-year old children hoping to attend college or university next Fall, who are already entitled enough as it is. If you ask me, the last thing we should be doing is fueling the selfishness of the millenial generation.

On the bright side, Bernie Sanders stance on student loans also includes reducing interest rates for existing loan holders (which I think is the most important reform that could be made), but I find it hilarious and suicidal that he plans on paying for all his reforms by levying a new tax on “Wall Street speculators”.

Good luck getting that approved when the same people fund the very pockets of your fellow politicians, Bernie.

What Is Likely to Happen in 2016?

Now that we’ve become familiar with each of the candidate’s plans, what is actually likely to occur once the new President takes office in 2016?

My thinking is that we will get some reform of the Federal student loans system, including, but not necessarily limited to, a reduction in interest rates, and expansion of the existing forgiveness benefits put in place by President Obama.

I do think that things will get better for those of us holding onto Federal student loan debt, but so far, from what I’ve heard, no one has proposed going after Private lenders, and offering any sort of real relief for those buried by excessive Private debt.

And that’s what ruins my day, because it’s typically not the Federal loan holders that have to choose between keeping the lights on and making their monthly payments. It’s those borrowers who were forced to turn to private lending, and who are now on the hook for tens or even hundreds of thousands of dollars in debt, without any real chance of ever paying it all back.

I’m hoping that one of these candidates will offer a plan for tackling that issue, but the problem is that it’s potentially political suicide during election season.

What will happen? We’ll see. Keep checking back for additional updates.

By: Tim Marshall

Tim's experience struggling with crushing student loan debt led him to create the website Forget Student Loan Debt in 2011, where he offers advice, tips and tricks for paying off student loans as quickly and affordably as possible.