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- California Sen. Kamala Harris sparked confusion on Twitter Sunday when she announced a program for student loan debt forgiveness.
- Harris tweeted out a specific point that would forgive debts for "Pell Grant recipients who start a business that operates for three years in disadvantaged communities."
- Many latched on to the post to point out the harsh obstacles that would hinder the chances of young small businesses surviving, and therefore, the policy’s efficacy in wiping away debt.
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Sen. Kamala Harris sparked confusion on Twitter Sunday when she touted a specific policy point for student loan debt forgiveness.
The California lawmaker wrote on Twitter that the proposed plan would forgive debts for "Pell Grant recipients who start a business that operates for three years in disadvantaged communities."
Pell Grants are reserved for students from low-income households, and can provide up to $6,195 for a school year. In the 2017-2018 school year, 7 million people received Pell Grants.
The announcement came as the latest in student debt forgiveness as a popular talking point for 2020 contenders, and included a pledge from Harris to work with Congress to create a $12 billion grant and support program to facilitate startup minority small businesses.
The proposal is a part of two new policy proposals her campaign said were designed to support closing the wealth gap among black Americans by focusing on investing in higher education and entrepreneurship.
The proposal details that as part of her initiative, "Participants can have up to $20,000 of debt forgiven and can defer all of their student loans, interest-free, during a business-formation period that can last for as many as three years. "
However, several users were quick to point out their concerns with how the conditions of the forgiveness didn’t seem to make sense when compared with the harsh realities of the low chances of a business’s success in its first several years.
Pell Grant recipients inherently face more challenges in obtaining their degree than other students.
Federal data released last year showed that only half of students at four-year universities and colleges who got Pell Grants in 2011 graduated within six years, in comparison to nearly 60 percent of all students.
"There is some threshold at which there are things that colleges don’t have control over and can’t be accountable for, but if you are consistently leaving more students worse off than when they came to you, that doesn’t seem like a worthwhile investment," said Jessica Thompson, policy and research director at the advocacy group The Institute for College Access and Success, or TICAS, told PBS last year. "Stuff like this is hard, but there’s no question colleges and universities could be doing better for these students."
Several of the Democratic candidates for the 2020 Election have included student loan forgiveness in their campaign messaging, much to the delight of voters who are years out of college and still in debt. However, this point proved confusing amid other, perhaps clearer, policies put forth so far in the 2020 race.
Overall, the conditions of the program seem to limit the benefits to a very small pool of people.
Harris’s previous proposals regarding student debt include making community college free, making four-year public college debt-free, and expanding the income-driven repayment program, which allows borrowers to elect to repay their loans as a percentage of their income.
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See Also:
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Source: Business Insider – feedback@businessinsider.com (Ellen Cranley)