Last month, the Trump administration restarted collections on unpaid federal student loans for the first time since March of 2020.
According to the Department of Education, “All 5.3 million defaulted borrowers will receive a notice from Treasury that their earnings will be subject to administrative wage garnishment.” In plain English: the federal government will take money directly from your paycheck if you’re more than nine months behind on your student loan payments.
The business press is hailing this as a return to “accountability,” and “the end of free college lunch.” It’s really a brutal austerity measure targeting young people. In a country where prices have risen over 24% since 2020, and many already struggle to pay rent and put food on the table, the attack on student debtors will only further ruin the lives of millions.
Are borrowers “irresponsible” for taking out loans in the hope of getting a quality education and a well-paying job? Absolutely not. What’s irresponsible is a system that lines the pockets of billionaire bankers, while working-class youth are saddled with expensive loans or priced out of higher education entirely.
Predatory lending
Over 40 million Americans have federal student loan debt, and only 38% are up to date on their payments. In addition to wage garnishment, those in default will face seizure of tax refunds, withholding of federal benefits like Social Security, hits to their credit scores, and more.
Young people alive today were born into a world of deep economic instability, beginning with the 2008 recession and compounded by the 2020 Covid pandemic. The capitalists would have us believe that by getting a college degree, we can secure a stable, well-paying job. This is a lie. According to the Bureau of Labor Statistics, the unemployment rate for college graduates between the ages of 20 and 29 was 13.6%, while the official overall unemployment rate currently stands at 4.2%.
The capitalists use this lie to pressure students—many of whom are still too young to legally drink alcohol or buy cigarettes—into taking out tens of thousands of dollars in loans, which many will never be able to repay. Compare the price of college now with 50 years ago. While the average annual cost of tuition and fees at public, four-year colleges was $503 in 1975, it had grown to $9,750 in 2023. Even when adjusted for inflation, this is a 316% increase.
It’s no wonder America is mired in an enormous consumer debt crisis. The US leads the world in credit card debt, with $1.21 trillion—an average of over $10,000 per household. On top of this, Americans owe over $1.7 trillion in auto loan debt. But both of these are outdone by the $1.77 trillion in education debt students have amassed to afford exorbitant tuition costs.
Make the billionaires pay!
The capitalists are desperate to reduce the $1.9 trillion federal deficit. The Trump administration is dead set on painful austerity, but the Democrats don’t offer anything better.
Joe Biden’s 2020 platform included eliminating all federal student debt for individuals earning under $125,000 a year. Once in office, he quickly dropped this in favor of a more “pragmatic” solution: forgiving $10,000 worth of loans for all borrowers. This proved not to be so pragmatic after all, as it was blocked by the Supreme Court in 2023. For her part, Kamala Harris didn’t make any concrete proposals to tackle student debt during her 2024 campaign.
The capitalists don’t want you to know that they can easily afford to forgive student debt and fund education for the next generation. But this would cut heavily into the profits of the billionaires who control both parties.
We need to make the billionaires pay for the crisis of their own system by expropriating the Fortune 500 and putting them under democratic workers’ control. A workers’ government will nationalize private educational institutions and merge them with public entities into a unified system. On this basis, we could completely abolish tuition and cancel all student debt. Universities would be democratized and run by the students and workers, not by billionaires on university boards. Only by overthrowing the decrepit capitalist system and establishing a workers’ government can we secure high-quality, free education for all.