John Delaney's plan for Student Loan Debt & College Affordability

More jobs require applicants to have a college degree than ever before and the cost of attending college keeps increasing.

Tuition at four-year institutions, both public and private, has doubled over the last 30 years while incomes for people with a bachelor’s degree has increased by just 18%.1 The college affordability crisis is particularly acute for women, who on average borrow more in student loans than men do and who earn less than similarly-educated men for doing the same work after they graduate.2 Delaney will work to make higher education affordable for every student and reduce debt burdens for individuals who are currently struggling to pay their student loans.

Lower the cost of higher education

  • As of December 2018, Americans owe more than $1.5 trillion in outstanding student loan debt. Nearly 70% of new graduates owe student loans, and average monthly student loan payments have topped $390.3 Delaney proposes the following policies to reduce the burden of student loan debt:
    • Expand eligibility and improve terms for the Obama administration’s income-based repayment programs. Borrowers using the Pay As You Earn Plan and the Revised Pay As You Earn Repayment Plan will have access to loan forgiveness 2 years earlier than the current requirement and will no longer pay taxes on the value of their forgiven loan amounts.
    • The federal government shouldn’t be making a profit on student loans. Delaney will reduce interest rates on federal student loans and set them equal to the interest rate on 10-year Treasury bonds.
    • Loans from private lenders are responsible for more than $100 billion in outstanding student debt, and interest on these loans is significantly higher than the rates for federal student loans. Delaney supports allowing borrowers with high interest private loans to refinance through the federal government with new, low interest federal loans up to the $27,000 cap.
      • The new federal loan would be eligible for income-based repayment programs.
    • Our system is stacked against student loan borrowers, and bankruptcy is just one example. Delaney authored legislation to allow people who need to declare bankruptcy to use that process to discharge student loan debt just as they can for auto loans or credit card debt.
  • Delaney supports increased funding for the Pell Grant program and increasing the maximum award to provide more support for students from low-income households.
  • Delaney is proposing a National Service Program that will award scholarships to people who complete their service.

Provide two years of post-secondary education to all

  • Delaney is proposing free tuition for two years of community college or technical career training for every high school graduate.
  • To be eligible for this program, states will be required to at least maintain their funding for higher education and two-year institutions must have curriculums that allow students to transfer seamlessly to four-year public institutions in their region.
  • Career colleges and certificate programs at nonprofit institutions can provide important skills to students who want a different education experience, but we need effective oversight to ensure these programs actually prepare students for the workforce without requiring students to take on unreasonable loads of debt.
    • Delaney is committed to defending the Obama administration’s Gainful Employment Rule and reversing Trump’s efforts to undermine it. This rule improves student outcomes and protects students from outsized debt burdens.

  1. “Tuition and Fees and Room and Board over Time.” College Board, 2019.
    “Educational Attainment—People 25 Years Old and Over by Mean Income and Sex.” United States Census Bureau, 2019.
  2. “Women’s Student Debt Crisis in the United States.” American Association of University Women, 2019.
  3. “A Look at the Shocking Student Loan Debt Statistics for 2019.” Student Loan Hero, 2019.