The Stimulus Deal Should Include Free College

The Covid-19 crisis bill currently under negotiation should both extend student loan relief and offer free college for young people facing limited job opportunities. 

Hayat Rahmeto is one recent college graduate who has decided to go back to school while the economy is in shambles. After graduating from college last year, she moved back in with her parents and planned to work two jobs to save money for law school. Then the pandemic hit. She lost one job, with Delta Airlines, and the prospects for finding another were bleak. 

Fortunately, with her parents providing rent-free housing, Rahmeto realized she could afford to attend her local community college in Omaha, Nebraska, where she’s now working on a paralegal certificate program. 

It will cost Rahmeto about $6,000. “This is the cheapest, most cost effective way to find out if law school is what I really want to do with my life,” Rahmeto told me.

Youth unemployment is sky-high, reaching over 20 percent for people aged 16 to 24 this June. Like Rahmeto, many other recent graduates would like to continue their education instead of trying to enter a bleak job market. 

But not all have access to rent-free housing or a spare $6,000 for community college — nevermind the skyrocketing cost of traditional universities.

According to a 2018 study from the Levy Institute, the average cost of college tuition more than doubled as a share of median household income between 1990 and 2014. Including room and board, the average cost of college is more than a third of a typical household’s earnings.

This helps explain today’s aggregate student loan debt of $1.6 trillion.

Black students on average have to take out larger loans to get through college than their White peers. A National Center for Education Statistics study reveals that Black Bachelor’s degree and Associate’s degree graduates face 13 percent and 26 percent more student debt, respectively, than their White peers. 

The challenge of paying off greater student debt is also worsened for Black graduates due to their lower average incomes. Black Bachelor’s degree and Associate’s degree holders earn 27 percent and 14 percent lower incomes, respectively, than Whites with the same degree. Canceling student debt and making public higher education free would begin to address these racial economic inequalities.

With few jobs available under the current crisis, it’s even more important to eliminate the financial barriers to continuing education. 

Senator Bernie Sanders has proposed a College for All plan that would eliminate tuition and fees at public four-year colleges, universities, and community colleges. Additionally, it would cancel student debt for 45 million Americans within six months and ensure low-income students can attend college debt-free.  

Free college proposals have received support from a growing number of organizations, including the Poor People’s Campaign. 

In a “Moral Budget” proposal released with the Institute for Policy Studies, they point out that these investments benefit the whole country — not just students. One California study they cite found that for every $1 invested in public colleges and universities, the state gained $4.50 due to reduced poverty, fewer arrests and incarcerations, and higher tax revenues. 

Making college free for all students would also help erase the stigma of financial aid. Rahmeto, who was born in the United States to Ethiopian immigrant parents, said she often felt other students looked down on her for having financial aid as an undergraduate at Franklin and Marshall College in Lancaster, Pennsylvania. 

Hayat Rahmeto (middle) on graduation day at Franklin and Marshall College in 2019.

“It’s like, what, I’m sorry I wasn’t born into a life where my parents could afford to pay 60-some thousand dollars a year,” she said. “But why am I any less deserving than you? I worked even harder to get where I am now.”

In the current negotiations, Republicans are opposing the major Democratic proposals to lessen the burden of the crisis on students: $10,000 in loan forgiveness for financially distressed borrowers and an extension of the CARES Act provision to suspend federal student loan payments, which is set to expire on September 30. Free college is not even on the table. 

Even before the pandemic, the exorbitant cost of higher education was holding our country back. That’s especially true now. Free college would allow young people who cannot find jobs now to learn new skills and knowledge that will better position them to join the labor market once the crisis is over.

Margot Rathke is a Next Leader at the Institute for Policy Studies. This op-ed was distributed by OtherWords.org.