Poll: Student Debt Cancellation May Bring Back Disenrolled College Students.

Survey Shows Student Loan Cancellation Could Encourage Students to Return to University

Findings from Gallup Poll

A recent Gallup poll has revealed that almost half of students who have left their university programs would be likely to return if some or all of their student loans were cancelled. The survey, conducted in late October and early November, found that 47% of students who have “stopped out” would be “very likely” to enroll again if their loans were cancelled. An additional 31% said they were “somewhat likely” to continue their education. The poll also found that willingness to return to university varied according to racial identification, with 57% of black respondents being “very likely” to enroll if their loans were cancelled, compared to 49% of Hispanic respondents and 37% of white respondents.

Biden Administration’s Student Debt Plan

The poll comes as the Supreme Court examines a plan from the Biden administration to cancel student debt for millions of individuals. The policy, which would cancel $10,000 in student loans per borrower earning salaries less than $125,000 as well as $20,000 per borrower who received Pell Grants, was enacted via executive order last year. Justices heard arguments in February for two cases against the student loan cancellation policy, one from six Republican attorneys general and another from the Job Creators Network Foundation, and are expected to release a decision next June.

Critics of the Policy

Critics of the student loan policy note that the measure would increase the national debt, with an estimated cost of $400 billion according to the Congressional Budget Office. The policy may also cause additional distortions in the postsecondary education market as borrowers consider the likelihood of more bailouts, according to an analysis from economists at the University of Pennsylvania’s Wharton School.

Impact of the Pandemic

The average federal student loan balance is $38,000, and students who disenrolled from their degree programs said on average that 70% of their outstanding loans must be forgiven to justify a return to the classroom. Nearly two-thirds of individuals who maintain student loan balances were refraining from making payments at the time of the survey due to ongoing pauses for federal student debt repayment, a measure introduced as an emergency pandemic relief measure.

Supreme Court’s Decision

The lawsuits presented before the Supreme Court assert that the policy violates the notice-and-comment processes mandated by the Administrative Procedure Act, which ensures that affected parties can offer comments on federal rules, and contradicts a recent ruling which determined that federal agencies cannot assert “highly consequential power beyond what Congress could reasonably be understood to have granted.” Justices who compose the conservative majority of the Supreme Court expressed skepticism toward the federal student debt cancellation plan and appeared to indicate that the White House should receive approval from Congress before attempting to implement the policy.