Presidential Candidate Positions on Paying for College
Students were the swing vote in the last two presidential elections. President Obama would not have been elected, if not for students. It is likely that students will once again be the swing vote in the elections in November. Accordingly, issues of concern to students, such as how to pay for college and student loan debt, may play a big role in the elections.
But, the Congressional races may matter just as much as which candidate wins the White House. According to the FiveThirtyEight election forecast, the most likely scenario involves split control of Congress. Even if one party wins both the White House, the House of Representatives and the Senate, that party is unlikely to gain a supermajority in the Senate. The other party will be able to block legislation through filibustering. So, cooperation between the two parties will be necessary for legislation to be enacted.
This article summarizes the positions of the major candidates for President concerning college affordability.
|Hold Colleges Accountable for Keeping Costs Down||Yes||Yes||--||--|
|Free Public College Tuition||Yes||No||--||Yes|
|Refinance Student Loans at Current Rates||Yes||No||--||--|
|Eliminate U.S. Department of Education||No||Yes||Yes||--|
|End the Federal Direct Loan Program||No||Yes||--||--|
|Forgive All Student Loans||No||No||--||Yes|
Hillary Clinton (Democratic Party)
Hillary Clinton, the Democratic Party candidate for President, has provided several detailed proposals about paying for college on her campaign web site.
Her centerpiece is a proposal to provide debt-free public college. Under her proposal, all participating community colleges nationwide would be tuition-free. The proposal would also provide free tuition at public 4-year colleges for families with income under $85,000. The income threshold would increase by $10,000 a year until it reached $125,000 in 2021. At that point, free public college tuition would be an option for 83\% of all families. College students would be required to work 10 hours a week in exchange for the free tuition, as part of an expanded Federal Work-Study program. This proposal would lead to several hundred thousand more Bachelor’s degrees being awarded each year. However, free tuition does not cover all college costs. It does not cover the cost of college textbooks, which can be a significant component of college costs, nor does it cover room and board and other living expenses. So, many college students would still need to borrow to pay for a college education. This proposal would not only require the cooperation of Congress, but also of the state legislatures.
Sec. Clinton has also proposed to allow previous student loan borrowers to refinance their student loans at current rates. This is similar to a proposal previously introduced by Senator Elizabeth Warren. The Clinton campaign says that this proposal will yield the typical borrower savings of about $2,000 over the life of the loan. It is unclear if this proposal covers just federal student loans, or also private student loans, and whether parent loans would be included.
Hillary Clinton has also said that she would streamline the four income-driven repayment plans into a single repayment plan. This repayment plan would cap monthly student loan payments at 10\% of monthly income, with forgiveness of the remaining debt after 20 years. It is unclear whether this forgiveness would be tax-free, like the 10-year forgiveness provided by the Public Service Loan Forgiveness program. It is also unclear whether the percentage of income is applied to adjusted gross income or discretionary income. (Existing income-driven repayment plans are based on discretionary income.) The Clinton proposal would simplify the enrollment process, replacing the requirement for annual authorizations with a single up-front authorization that is good for the entire repayment term.
The Clinton campaign also proposes to:
- Encourage employers to help their employees pay down their student loans. This proposal includes both employer-paid loan repayment assistance and payroll deduction for student loan payments.
- Crack down on predatory colleges, lenders and collection agencies.
- Hold colleges accountable for keeping costs down.
- Implement a 3-month moratorium on student loan debt repayment to help borrowers refinance their loans or switch into income-driven repayment.
- Create a 3-year student loan deferment program for entrepreneurs, which would suspend student loan payments and block the accrual of interest for the duration of the deferment.
- Provide social entrepreneurs with $17,500 in student loan forgiveness, similar to the current teacher loan forgiveness program.
- Simplify the Free Application for Federal Student Aid (FAFSA).
- Restore year-round Federal Pell Grants
- Increase funding for on-campus child care.
- Expand the AmeriCorps program from 75,000 to 250,000 volunteer positions.
- Allocate $25 billion in funding for HBCUs, minority-serving institutions and low-cost private colleges.
Donald Trump (Republican Party)
Mr. Trump is critical of the federal government profiting off of student loans. He proposes to end the Direct Loan program, replacing it with loans from banks and other financial institutions. He has said that these lenders will base eligibility on the student’s future earning potential.
Mr. Trump has proposed replacing all student loan repayment plans with a single income-driven repayment plan, which would cap monthly student loan payments at 12.5\% of monthly income, with cancellation of the remaining debt after 15 years. It is unclear whether this cancellation would be tax free. It is also unclear whether the percentage of income is applied to adjusted gross income or discretionary income. It is unclear whether the monthly payment would be capped based on the standard repayment amount, as in the income-contingent, income-based and pay-as-you-earn repayment plans, or uncapped, as in the revised pay-as-you-earn repayment plan.
He wants colleges to have skin in the game with regard to student loan defaults, perhaps through a risk-sharing initiative. Colleges might then have to repay the federal government for all or part of the cost of federal student loan defaults.
Mr. Trump proposes to push colleges to spend more of their endowments on students. He suggested that colleges might lose their tax exempt status if they don’t use more of their endowment funding “to cut the skyrocketing cost of tuition.”
Donald Trump has said that he opposes proposals for tuition-free public higher education.
He has said that he would cut or eliminate the U.S. Department of Education. It is unclear whether this statement applies just to the federal government’s role in K-12 education, or also postsecondary education. At the same time, he has said that education is one of the three most important priorities of the federal government.
Gary Johnson (Libertarian Party)
Gary Johnson, the Libertarian Party candidate for president, has not said much about higher education, other than a proposal to eliminate the U.S. Department of Education.
Jill Stein (Green Party)
Jill Stein, the Green Party candidate for president, has two main proposals concerning college affordability.
She would abolish student loan debt by bailing out all student loan borrowers.
She would also “Guarantee tuition-free public education from pre-school through university.”
When financial aid and federal student loans aren't enough to cover all college costs, consider financing the gap with private student loans. Shop around to find the loans that best fit your needs.