Congress Simplifies FAFSA as Pressure Grows to Solve Student Loan Crisis – The Oberlin Review
In a spending bill passed earlier this month, Congress made several changes to how students pay for higher education — delaying the implementation of the federal simplification law by a year. of the student aid application and increasing the maximum grant for Pell grant recipients by $400. The changes come amid a wider national discussion about the future of the student loan crisis.
Most changes to the FAFSA will not take effect until the 2024-2025 academic year, so the current freshman class will be the only Oberlin-enrolled class affected by the time the revisions take effect. One of the biggest changes was to reduce the 108 questions on the FAFSA form to a maximum of 36.
Despite the delay, some minor changes have already taken effect, such as the removal of a question on Selective Service and another on whether the applicant had ever been convicted of a drug-related offence.
“For students who had already been arrested for drugs and who had already done everything they had to do, whether they had served their sentence or gone through the legal process, it was almost like holding them responsible for all of this again,” the CFO said. Help Michele Kosboth says. “So to be able to take that out of the FAFSA and say that students don’t have to answer that question really felt like a gesture of social justice.”
Visiting assistant professor of politics Amanda Zadorian studies economic inequality and echoes Kosboth’s sentiment, saying the change is a step in the right direction.
“One thing that I think is really great is that there’s now Pell eligible for incarcerated students in the new FAFSA, and also drug convictions no longer count against you,” Zadorian said. “I think those are really important for equity. Big wins for equity.
In the long term, the law aims to make changes to FAFSA to simplify the filing process. However, it is too early to assess how these changes will affect how Oberlin distributes financial aid or who will be eligible for government programs like the Pell Grant. The revised FAFSA will also include a new financial metric called the Student Aid Index that will replace the current FAFSA Estimated Family Contribution.
“What’s coming next…are changes to how the formula works,” Kosboth said. “That’s the part that we don’t really understand yet in terms of the impact on Oberlin students. [A] two of the things that are going to change that we know, for example, is that they will no longer look at how many students in the household are in college.
The passage of the FAFSA Simplification Act and increased Pell Grant funding may be a relief for students and their families who must navigate the difficult process of applying for financial aid. Yet the changes do little to address the larger problem of the student loan crisis in the United States.
Since President Biden was elected in 2020, progressives have pushed for Biden to use his executive power to cancel student loans. During his campaign, Biden promised to forgive $10,000 in federal student loans per person.
“It’s something that has a long, very long history – the idea of canceling all debts to prevent an uprising of the lower classes,” Zadorian said. “The federal government holds $1.6 trillion in student loans. Which is a lot of money, but it’s only double the defense budget that was passed for 2022. So that’s literally two years of federal military spending.
Zadorian traces the history of the student loan crisis to the 1980s, when the austerity drive opened the door to greater privatization and reliance on debt. As a result, many public universities became underfunded – a trend that continues to this day. This drives students to seek private education, which contributes to rising levels of student debt.
“Rather than going to a well-funded public university, where you pay a nominal fee for a quality education and emerge debt-free into the world and become a productive member of society, you are instead expected to borrow from your future earnings to go to a private college to get a quality education,” Zadorian said. “And the promise there, the kind of social contract, is that once you get that quality degree, you’ll find a job and be able to repay the debt.”
Unfortunately, that reality has not materialized for the estimated 43 million Americans in student loan debt who face growing income inequality and the difficult task of achieving upward mobility.
“People of this generation from the 1980s, 1984 who are not upwardly mobile are not able to pay their debt and buy houses,” Zadorian said. “Which means they don’t create wealth by having this domestic asset, which is the primary way Americans create wealth. And that’s going to have ongoing implications as they get older and older.