Sen. Bernie Sanders (I-Vt.) announced on Monday that he will introduce legislation that would eliminate the estimated $1.6 trillion worth of student debt held by around 45 million U.S. citizens.
I am introducing legislation to tax Wall Street and eliminate the student debt of more than 40 million Americans with @RepJayapal and @Ilhan. It is time to #CancelStudentDebt. Watch LIVE now: https://t.co/ZvSGQtRqEd
— Bernie Sanders (@SenSanders) June 24, 2019
Sanders claimed that this massive expenditure can be funded by a 0.5 percent tax on all stock trades, a 0.005 percent fee on derivative trades, and a 0.1 percent tax on bond trades. According to the Washington Post, Sanders believes these taxes would raise $2 trillion over a 10-year period. He did not indicate whether or not his plan included research on if this would have an impact on the stock market or stock trading itself.
The proposed plan would also make community colleges and public four-year colleges free. It is not clear at this point what the full cost of Sanders’ plan would be, when subsidies for public colleges is factored in. The debt forgiveness portion of this legislation would necessarily also have some degree of administrative costs. The plan to cancel student debt appears to be a a one-time offer, and not something that would apply to all holders of student debt in the future.
This bill is in line with other proposals for massive government intervention from Sanders, a self-proclaimed democratic socialist.
Sanders called the plan “truly a revolutionary proposal.”
Rep. Ilhan Omar (D-Minn.) and Pramila Jayapal (D-Wash.) will introduce similar legislation in the House of Representatives. The legislation also has the support of Rep. Alexandria Ocasio-Cortez, who joined Sanders at a news conference Monday morning to announce the proposal.
Fellow presidential hopeful Sen. Elizabeth Warren (D-Mass.) has also proposed a similar plan for student debt forgiveness. However, unlike Warren’s plan which would eliminate only a percentage of student debt based on the household income of the person holding that debt, Sanders’ plan would eliminate all of the debt for every student in the country. regardless of personal wealth or household income level.
Sanders introduced a similar bill, the “College For All Act,” in 2016.