Each year, the Executive Branch of the United States has the unique opportunity to set the country’s financial priorities through its proposed budget. In 2024, the debate around student loan forgiveness programs, including the Public Service Loan Forgiveness (PSLF) program, remains a contentious issue. The Biden administration has been pushing for broader student debt relief, but significant hurdles remain, especially with ongoing legal challenges and a polarized Congress.
The cancellation or significant reduction of the PSLF program could mean more than just the loss of an opportunity to alleviate the crippling debt burden for millions of Americans. For many, the program has led to a paradoxical increase in debt while making supposedly qualifying payments. This is partly due to the requirement that borrowers be enrolled in income-driven repayment plans, which cap monthly payments at 10-20% of discretionary income. If these payments are insufficient to cover the interest, the unpaid amount is added to the principal, leading to a situation called “negative amortization,” where the debt grows rather than shrinks over time.
Recent data from the Federal Reserve shows that the total student loan debt in the U.S. has reached over $1.75 trillion, with an estimated 45 million borrowers still owing money. For those in the Church, many of whom fall within the age group carrying the bulk of this debt, the implications are significant. The financial strain can affect not only personal finances but also the ability to give back to religious communities and participate fully in charitable practices.
Though student loan forgiveness seems like a no-brainer to the indebted, those without student loan debt have been harder to convince that it is a wise use of taxpayer dollars.
Oppositional Statement #1: How will it affect me or my family if the Public Service Student Loan Forgiveness Program is cancelled? We don’t have any student loans.
On an individual basis, this program makes a difference in where people can afford to live, whether or not they can ever afford to buy a home, and what their retirement will look like when they are older. This also means loan forgiveness will affect the number of people who can pay property taxes and share more of the financial burden to fund our schools, roads, and other societal priorities. That is the societal impact.
But let’s take a moment and discuss how it will affect the Church. First, I do want to say that I believe God can do anything. I don’t want it to appear I am doubting his capabilities. However, as His hands and feet we are to do good works that benefit the spread of the Gospel and charity for relief of the poor, widowed, orphaned and hurting. In the context of the Church, a Pew Research Center Religious Landscape Study shows that church members ages 49 and under made up 54% of the Church in the United States. A 2019 Experian data chart shows that student loan borrowers under age 49 owe 82% of the nation’s student loan debt at a whopping $984.4B ($984,400,000,000). That’s a LOT of zeros. Even more so, that is a lot of debt for 54% of the Church, who may have to make the unfortunate decision between tithing and paying for groceries.
Opposition Statement #2: Why should someone else’s debt forgiveness come out of my taxes?
Understandable. It isn’t fair to have to pay someone else’s tab. But just for fun, let’s examine how you already do that. Tax breaks given to 60 corporations in 2018 impacted the Federal government with a loss of $20.7 billion in uncollected taxes. Our government still has expenses. How do you figure the Federal government makes up for that tax deficit? The first method is to cut expenses in the budget. Another method is to have the taxpayers foot the bill.
Furthermore, let’s assess how everyone’s tab (including yours) is already being paid for via Social Security, roads, and public schools, all paid for by taxpayers.. Just. Like. You. If someone who had a fully funded retirement with no children and never contributed toward taxes for Social Security or public schools, what condition would they be in when it is your time to use them? A la carte tax policies do nothing for the common good.
Oppositional Statement #3: 20% of gross income is not too much to pay toward student loans each month!
Yes, it sure is! To provide context, let’s use an example. An individual earning $60,000 per year with federal and private education loans must pay $1,000 per month in student loan repayment according to income-based repayment plans. Income taxes are around 28%. Housing in theory should cost no more than 30% of gross household income, though that is debatable due to the housing crisis and lack of affordable housing. If this individual is a tithing Christian, they are supposed to offer up 10% of their income to the Lord before any other expenses. After income taxes, student loans and housing, and if they’re a tithing Christian, this individual would be left with 12% of their gross income ($600) toward all of their other expenses including car payments & insurance, health insurance, utilities and food.
Student loan debt is not just a worldly, economic problem; it impacts the tithing ability and thus the spiritual health of up to 54% of the American church’s membership.
The question of whether or not Americans have a right to oppose federally funding this program is non-negotiable: its citizens have the legal right to oppose any government programs as stewards of their society’s resources. Christians however, must examine whether opposition to such a cause is the best moral position to hold as well as its long-term impact on the Church.
