The Stimulus Deal Should Include Free College

The Covid-19 crisis bill currently under negotiation should both extend student loan relief and offer free college for young people facing limited job opportunities.

Hayat Rahmeto is one recent college graduate who has decided to go back to school while the economy is in shambles. After graduating from college last year, she moved back in with her parents and planned to work two jobs to save money for law school. Then the pandemic hit. She lost one job, with Delta Airlines, and the prospects for finding another were bleak.

Fortunately, with her parents providing rent-free housing, Rahmeto realized she could afford to attend her local community college in Omaha, Nebraska, where she’s now working on a paralegal certificate program.

It will cost Rahmeto about $6,000. “This is the cheapest, most cost effective way to find out if law school is what I really want to do with my life,” Rahmeto told me.

Youth unemployment is sky-high, reaching over 20 percent for people aged 16 to 24 this June. Like Rahmeto, many other recent graduates would like to continue their education instead of trying to enter a bleak job market.

But not all have access to rent-free housing or a spare $6,000 for community college — nevermind the skyrocketing cost of traditional universities.

According to a 2018 study from the Levy Institute, the average cost of college tuition more than doubled as a share of median household income between 1990 and 2014. Including room and board, the average cost of college is more than a third of a typical household’s earnings.

This helps explain today’s aggregate student loan debt of $1.6 trillion.

Black students on average have to take out larger loans to get through college than their White peers. A National Center for Education Statistics study reveals that Black Bachelor’s degree and Associate’s degree graduates face 13 percent and 26 percent more student debt, respectively, than their White peers.

The challenge of paying off greater student debt is also worsened for Black graduates due to their lower average incomes. Black Bachelor’s degree and Associate’s degree holders earn 27 percent and 14 percent lower incomes, respectively, than Whites with the same degree. Canceling student debt and making public higher education free would begin to address these racial economic inequalities.

With few jobs available under the current crisis, it’s even more important to eliminate the financial barriers to continuing education.