DENVER (KDVR) — President Joe Biden’s plan may knock out some loans, but will it will break the decades of tuition hikes that caused the debt?
Biden announced Wednesday that up to $20,000 in student debt will be forgiven for federal student loan borrowers. Additionally, borrowers will not be required to make monthly payments until 2023, a continuation of the payment freeze that has been in place since the beginning of the COVID-19 pandemic.
Collectively, students hold $1.6 trillion in federal student loan debt in the U.S. In the last two decades, tuition hikes have played a large role in the pileup.
Since 2002, tuition increases across the country have outpaced inflation by three or four times.
In the 20 years between the 2001-02 academic year and the 2021-22 academic year, consumer prices have risen 54% across all categories.
The average in-state public university tuition rose by 211% in the same time, according to records compiled by U.S. News and World Report. Out-of-state tuition rose by 171%, and private university tuition rose by 144%.
The University of Colorado Boulder’s tuition rates are an example, but they have risen even faster than the national average.
In 20 years, in-state tuition at CU Boulder has quadrupled or quintupled, according to the university’s tuition archives. CU Boulder charges different rates for different studies. Each has gone from $1,000-$2,000 per semester in 2001 to $6,500-$9,300 in 2021.
Household income has risen in those 20 years, but not enough to keep pace. Tuition isn’t simply more, but a much larger chunk of the average Colorado family’s total income.
In 2001, the annual cost of tuition was 6-8% of the median Colorado household income. Now, it is 16-22% of the median household income.