There have been any number of proposals recently for jump starting our sluggish economy, but how about this one. Rep. Hansen Clarke from Michigan has introduced House Resolution 365 encouraging President Obama and Congress to forgive student loans as a means of economic stimulus. The premise is that millions of people would suddenly have thousands of dollars to pump into the local economy rather than servicing their educational debt. This infusion of cash would cause businesses to hire, putting people to work and spawning a new era of entrepreneurship and innovation. There is even a petition you can sign to support this resolution at signon.org and more than 300,000 people have signed on.
I guess the thought is that our government has forgiven huge banking debt and bailed out big financial institutions….why not student loans? If we value an educated work force, why saddle our citizens with crippling student debt at a time when the statistics on student loan default are staggering and many of those graduates can't find jobs? Perhaps this idea has some merit, but it begs other considerations. Should those loans have to be repaid once the student secures employment? And what about future student loans…will they also be subject to forgiveness? All reasonable questions, and they could be addressed in this proposal. In my opinion, it's no crazier than some other ideas that have been put out there.