McRae: A $1.2 billion bailout isn’t the answer
By: Treasurer David McRae
This February, President Biden announced he will be forcing taxpayers to foot the bill for another $1.2 billion in student loan cancelations. This is wrong. Mississippians who have paid off their debt or chose not to attend college shouldn’t be responsible for paying other people’s collegiate bills. It’s as simple as that.
Of course, there’s no denying that student debt is a problem in the United States. As of mid-2023, Americans held about $1.77 trillion in student loan debt. Mississippians are not immune to it either. In fact, we rank 10th in the nation for the highest amount of student debt, with the average borrower holding about $45,000 worth. In a state where the average household income is just $46,000 a year, that amount of debt can be devastating.
But forcing the 86 percent of Mississippians who do not hold student loan debt to bail out the 14 percent who do seems wrong and does nothing to prevent the problem in the future.
Despite the national conversation around student loan debt, millions of Americans continue to take out these loans each year. For these people, no relief is being offered.
To solve the root of this problem, we must find ways to reduce – or eliminate – the need for student loans. Fortunately, the Mississippi Treasury’s College and Career Savings program does exactly that.
The College and Career Savings program empowers families to take personal responsibility over their college expenses. Our MACS accounts, for example, allow individuals to contribute to a tax-advantaged savings account. This account can earn interest over the years, compounding its value by the time a student is ready to use it. These accounts are also incredibly flexible and can be used for everything from laptops to apprenticeship programs to college tuition.
Our MPACT plans also provide incredible value to families, allowing you to lock in today’s tuition rates and pre-pay college altogether. These plans are available for Mississippi’s 4-year colleges, but also for more than a dozen of the state’s community colleges.
The U.S. credit rating was recently downgraded. Our national debt continues to mount. Inflation is making many families tighten their belts. Now is not the time to force taxpayers into a billion-dollar student loan bailout. We need to create competition in the marketplace, drive down prices, and equip families with the tools they need to take personal responsibility over their own educational expenses.
To learn more about Mississippi’s College and Career Savings programs, please visit treasury.ms.gov/CollegeSavings.
Mississippi Treasurer David McRae is the 55th Treasurer for the State of Mississippi. In this role, he helps manage the state’s cash flow, oversees College Savings Mississippi, and has returned more than $85 million in unclaimed money to Mississippians. For more information, visit Treasury.MS.gov.
