Lawmakers propose massive student loan cancellation and free college plan

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ATLANTA (NewsNation Now) — With college costs spiraling, millions of students struggling to pay for higher education, the financial burden for many is lingering well beyond their degree. 

Americans currently owe $1.7 trillion in student loans, with 93% of that backed at the federal level.

“It’s just so hard to pay for college. I work through college. I have to or else I just would not be able to afford to go here,” said Valerie Lambo, a sophomore accounting major at Georgia State University.

To combat that, Sen. Bernie Sanders (D-Vt.) and Rep. Pramila Jayapal (D-Wash.) proposed on Wednesday the largest student loan cancellation and free college plan in modern history: the College for All Act would:

  • Would make community college and trade schools free to everyone
  • Make public four-year colleges and universities tuition-free for all students from families earning less than $125,000 a year
  • Double the Pell Grant to almost $13,000

Michael Ellison, CEO of CodePath, says higher education needs to be more accessible across the board.

“If you look at the past year, and you look at disadvantaged and underrepresented populations, dropping out of college or just choosing to forget,” said Ellison. “A big part of that reason is just the financial costs, and we absolutely need to move in a direction where education is more free, more accessible.”

CodePath partners with universities to prepare underprivileged and underrepresented students for tech careers.

“A lot of students are struggling just at the basic necessities, let alone talking about what you need to thrive in a technical career, whether that’s the hardware as a laptop or whether you’re looking at universal high-speed broadband,” said Ellison.

The federal government would shoulder about 75% of the cost, while states would pay the remaining share.

However, the pushback comes from how lawmakers plan to fund it: by taxing Wall Street.

“I’m wondering here. How come the banks aren’t getting hit up? Aren’t they the ones charging student loans? Charging 7, 8, 9% for student loans. Why weren’t the colleges saying ‘Hey, why don’t we reduce the actual cost of college?’” said Matt Sapaula, the PHP Agency Inc. Chief Distribution Officer

The proposal puts a tax on trades with stocks at .5%, bonds at .1%, and derivatives at .005%. It’s a move Sapaula says will, in the end, hurt middle-class Americans. 

“So there are people who are saving, buying, selling, buying stocks, bonds, mutual funds, you can’t, you’re penalizing those who are actually buying and selling growing businesses,” said Sapaula.

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