No one’s talking about student loans right now, but they’re about to be. Other than the Debt Collective, which has been ringing alarms about ballooning household debt for well over a decade, mainstream and even alternative media has been fairly silent about the fact that starting in October, millions of Americans will have to start paying student loans again for the first time since COVID. This looming student loan debt crisis will only exacerbate a rolling political and cost of living crisis right before the midterm elections.
Student loan debt is about to become a catastrophic problem for the Trump administration and it will be one of the most important things for a future Democratic administration to handle on Day 1. Student Loans are the political and economic crisis that have the potential to continue the large scale changes we’ve seen to our politics. Furthermore, due to the Supreme Court’s intransigence, resolving this crisis might be the very thing that finally strips the court of its undeserved power. To get a sense of what’s about to happen, it’s worth diving into to understand the sheer mess we’re facing, how we can get out of it, and how the left can use it for our political ends.
On July 1st student debtors received emails from their loan servicers that they would have to restart loan payments within 90 days. For anyone who graduated college after 2020, this is a particularly harrowing experience because they have never paid student loans before.
Starting September 29th student loan payments will resume. Those who signed up for payment plans will lose up to 10% of their incomes.Those who didn’t sign up for new plans because they either forgot, or never got the email, or their loan servicer fucked up (something that happens all the time), will be automatically enrolled in a 10-year standard repayment plan. Monthly premiums for the 10 year payment plan are based on total amount owed, not income, so debtors who took out large amounts of student loans will see insane monthly premiums!
Historically speaking, if you’re in charge of a government you usually don’t want to piss off the youngest and most highly educated strata of society since they are likely to engage in politics either through conventional or more revolutionary means. But Republicans don’t care. They are not idiots; they hate the idea of higher education more than they like the idea of winning elections. They don’t want an educated populace. They want a poorly educated populace they can financially exploit and manipulate. They hate you for daring to get an education. They want you to suffer for it.
There is currently $1.73 trillion in public student loan debt, held by some 42.6 million borrowers. For comparison, the total credit card debt in the US is $1.26 trillion and medical debt is $194 billion, making total student loan debt bigger than both categories combined. Unlike other forms of debt, student loan debt is extremely difficult to discharge in bankruptcy. If you’re in debt, you’ll stay in debt.
The average student loan debtor is $40,467 in debt, and for those who went to graduate programs that number is considerably higher. This means that when student loan payments resume, the average debtor could be paying around $350 per month on a standard 10-year repayment plan. Given that the average salary for a new college graduate is $56,000 per year or $4667 per month (before taxes) new college grads will be paying 7.5% percent of their income on loans. For those with higher principals, there are income based repayment plans that cap payments at 10% of income (in exchange for the principal ballooning out of control), but given the severe cost of living crisis we find ourselves in (a crisis that’s getting much worse due to the Iran War), forcing young professionals to pay anywhere between 7-10% of income is a potential catastrophe. For reference, the average cost of housing in the US is $2,189 per month or 46% of the average salary of a new graduate, food is $847 per month or 18%, transportation is $1,113 or 24%. For those keeping score at home, we’re already at 88% of a new college graduate’s income (before taxes!) and that’s just for the basic necessities! Student loans have the potential to be the straw that breaks the camel’s back.
How Did We Get Here?
There was once a time when college education in this country was either publicly provided and free or readily affordable. That changed thanks in part to Ronald Reagan, who imposed tuition fees on the University of California System as governor, ending a century of free, public higher education. Meanwhile in New York City, the City University of New York system, CUNY introduced tuition fees in 1975, coincidently just as people of color were starting to enroll in the university system en masse. Around this time, in 1965 the federal government introduced the public student loan program we know today. Originally those loans had strict caps on how much could be lent out to borrowers, but those caps were raised or eliminated with time. Meanwhile colleges and universities could keep jacking up tuition because students could take out federal student loans to cover the cost. The 2008 financial crisis further supercharged this trend as state governments pulled funding from universities, pushing them to offload costs onto students in the form of higher tuition.
While all of this was going on, industrial manufacturing in America was dying out, being shipped off overseas where labor costs were lower and there weren’t things like unions or child labor laws. This meant that a college education became essential to anyone who wanted financial stability. The average high school graduate makes $51,688 a year, compared to $81,016 for those holding a college degree.
Before we go any further, let’s dispel the classic conservative myth that college is a waste. As I showed, college earners earn significantly more than high school graduates. People like noted rich-guy Mike Rowe, love arguing that young people should go into the trades instead of going to college, but it’s actually really fucking hard to get a union trade job. Most people with high school diplomas or less education are not going to end up working a lucrative trade job. They’ll end up in the service economy, making near poverty levels wages. A college education is no longer the gateway to the middle class, it is essential to live a life approaching comfortability. Yes, there are affordable colleges, but even state schools cost an average of $24,481 per year when room and board are taken into account. Finally, college degrees are essential for so-called “pink collar” work, working class professions, like nursing, teaching, and social work disproportionately held by women. Even if we had all the trade union jobs imaginable, we’d still need nurses! Oh and by the way there are huge shortages of nearly all pink collar work. I wonder if unaffordable higher education is a reason why?
As the student debt crisis ballooned, presidents took some action to address the crisis. George W Bush introduced the Student Public Service Loan Forgiveness, which forgave student loans after 10 years for anyone who took a job with a qualifying government or non-profit. Barack Obama introduced a variety of payment plans so that instead of having to pay a fixed amount every month, student debtors would pay a portion of their salary, around 10%. None of this was nearly enough to address the crisis, especially as costs of higher education kept on ballooning out of control. Meanwhile Republicans became so polarized against higher education during the Obama years that they straight up became opposed to any relief on student loans whatsoever. COVID offered a reprieve for borrowers, as the federal government paused payments as the economy shut down. Joe Biden, in typical fashion, did the bare minimum to address the problem, waiting until the last possible moment before the payment pause ended to introduce the SAVE program, which would reduce the income threshold for repayments from 10% to 5%, which was then quickly quashed by the Supreme Court. Litigation has kept payments paused since 2020, but after a court decision in March 2026, they are set to resume this month.
There is Only One Solution
There are those who argue that because the general public is split about 50-50 on loan forgiveness, politicians should focus their attention elsewhere. But this misunderstands the problem. Those who don’t support loan forgiveness don’t have student loans or they paid them off long ago back when they were much lower. They do not understand the scale of the crisis. Student loan debt is not a political issue to be weighed by opinion polls, it is an economic crisis that disproportionately affects the educated, the young, and women.
Of course the only actual solution is federal student loan cancellation. We cannot live in a world where we tax young people 10% of their salaries right when they’re supposed to be buying homes and having kids (Did you forget that there’s a fertility crisis? Why aren’t you having babies???). Before COVID, student loan forgiveness had become quite a popular policy idea. Elizabeth Warren’s relatively moderate proposal to forgive $50,000 in student loan debt rocketted her to the top of primary polls and Bernie Sanders followed her up with a proposal to forgive all student loan debt. No doubt that all of the progressive Democratic primary candidates in 2028 will be running on some form of loan forgiveness.
But before that happens student loan payments will resume and it will be a total catastrophe.
Higher education is a human right that should be afforded to everyone for free. What our student loan system has become is essentially an income tax on college graduates. If a politician proposed taxing young educated people an income tax of anywhere between 7.5 and 10% they’d be laughed out of the room. But through the privatization of education in America, poor policy planning, and decades of kicking the can down the road, we find ourselves with this ridiculous tax and it threatens to destabilize an already not-really-all-that stable economic situation.
If you think it’s creepy and gross that Republicans want you to personally suffer for getting an education, well you’re right, it’s creepy and gross! Student loans are just one front in the war to dismantle higher education. Republicans are defunding universities, making it impossible to get loans for certain professions (mostly professions held by women), and shutting down academic programs The Republican Party does not mind losing a midterm election in pursuit of this goal if long term, higher education becomes something only attainable by the rich idiot children of the elites. So instead of forgiving student loans, Trump is trying to solve the affordability crisis he made significantly worse by...importing potentially tainted Argentinian beef.
But Republicans in their cruelty and stupidity have created a cost of living crisis so bad that there is already a widespread movement to fundamentally reshape our economic system. The resumption of student loans is only going to supercharge that movement.
Crises don’t just disappear on their own. They build and build until they reach some form of resolution. Whoever becomes president in 2029 should forgive student loans on day 1, freeing the millions of borrowers from crushing debt. If the Supreme Court strikes it down, the president should use the opportunity to delegitimize the court by rallying millions against them. At some point the Supreme Court will have to be delegitimized. Student loans could be a potentially powerful way of doing so, but it will require political will and courage.
But January 21st, 2029 is a long way away. And by the way, the Iran War has already cost $37 billion dollars. That’s enough to fund a full year of free, public college in the US. So in the meantime enjoy paying 10% of your income to the federal government. And every time you see a huge chunk of your very limited money disappear from your bank account, just remember, it’s going to people who hate you all for the crime of getting an education.
