Student Loan Forgiveness

Question A: A state student loan forgiveness program would help Ohio retain educated workers.

Question B: A state student loan forgiveness program would increase tuition costs at colleges and universities in Ohio.

Question C: A state student loan forgiveness program would increase inflation.

Question A: A state student loan forgiveness program would help Ohio retain educated workers.

Economist	Institution	Opinion	Confidence	Comment
Jonathan Andreas	Bluffton University	Agree	4	Probably not much effect and it would need to be targeted to have maximal bang for the buck. For example, just forgive a portion for each year of state residency so that people don't just get their loans cancelled in year one and then leave.
Bizuayehu Bedane	Marietta College	Agree	8
David Brasington	University of Cincinnati	Strongly Disagree	10
Kevin Egan	University of Toledo	Disagree	8	Where people choose to live and work has many factors--I don't view this as being a major factor.
Bob Gitter	Ohio Wesleyan University	Agree	8	If the program was structured such that the foregivenss was conditional in staying in Ohio for a certain period of time.
Nancy Haskell	University of Dayton	Uncertain	5	I think it really depends on details of how the loan forgiveness program is targeted.
Paul Holmes	Ashland University	Uncertain	5	I guess such a plan could work if it were designed to do so, forgiving a fraction of the amount per year someone works in Ohio. But I doubt a one-time transfer would achieve this goal.
Michael Jones	University of Cincinnati	Uncertain	5
Fadhel Kaboub	Denison University	Uncertain	10	Student debt cancellation should be a national policy, rather than state by state. There is no guarantee that beneficiaries of student debt cancellation will stay in Ohio unless it is tied to a minimum years of public service or employment requirement in Ohio. Say after 5 years of working in Ohio the full balance of your student debt is cancelled.
Charles Kroncke	Mount Saint Joseph University	Agree	8
Trevon Logan	Ohio State University	Agree	7
Joe Nowakowski	Muskingum University	Agree	7
Cort Rodet	Ohio University	Uncertain	10	There's too much uncertainty about how such a program would work, how it would be financed, and what criteria would be used to determine eligibility to offer any kind of conjecture. Would anyone in the state be eligible? Would it only be those who studied in Ohio? Could it attract borrowers from other states? Would those who qualify have to stay in the state following forgiveness? How would this be enforced? Estimates suggest that the Biden plan would wash away over $16B in debt for Ohioans, which is about a quarter of all student debt carried by state residents. That's not a small amount by any means. If the State were to match the Biden plan, how would it be financed? Perhaps more importantly, what would it mean for the average monthly budget for Ohioans with outstanding debt? A vast majority of borrowers in the state owe more than $10k, so while forgiveness will certainly help them, they'll still be left repaying a majority of their outstanding debt. Also, given the options for income driven repayment plans at the federal level, it's not clear what the effect on monthly budgets would be for households. It might not amount to much on a monthly basis, so it comes down to the long view of borrowers. Is a slight reduction in monthly expenses worth staying in Ohio to qualify for debt forgiveness to get out of debt sooner but far down the road? Is it worth the potential increase in future taxes to finance forgiveness? It's impossible to say at this point.
Lewis Sage	Baldwin Wallace University	No Opinion	5
Dean Snyder	Antioch College	Agree	5
Kay E. Strong	Independent	Strongly Agree	10
Albert Sumell	Youngstown State University	Agree	8	Some students on the margin would stay if it meant some of their loans would be forgiven.
Ejindu Ume	Miami University	Strongly Agree	8
Rachel Wilson	Wittenberg University	Uncertain	6	It doesn't fix the long term problem of higher education affordability.

Question B: A state student loan forgiveness program would increase tuition costs at colleges and universities in Ohio.

Economist	Institution	Opinion	Confidence	Comment
Jonathan Andreas	Bluffton University	Agree	3	It would increase demand, but probably not much effect because it is so far in the future for students, they would see it as uncertain as to whether the program would still be there, and part of it would just crowd out other funding.
Bizuayehu Bedane	Marietta College	Uncertain	8
David Brasington	University of Cincinnati	Disagree	8	It would encourage future college students to take out more student loans than they otherwise would have...and to delay paying them off.
Kevin Egan	University of Toledo	Strongly Disagree	10	I assume this would be a one-time debt forgiveness like the federal program so it would not be a factor about future college pricing.
Bob Gitter	Ohio Wesleyan University	Disagree	8	I don't see how the program would affect the costs of the colleges and universities unless an increase in the demand to attend their schools allowed them to raise prices.
Nancy Haskell	University of Dayton	Uncertain	5	Again, very much depends on the parameters of how narrowly (or broadly) the program eligibility is defined.
Paul Holmes	Ashland University	Disagree	6	It might be used as an excuse to raise tuition at state schools, but that's a political decision, not an automatic result of a loan forgiveness policy. I doubt this would have any significant effect on private schools.
Michael Jones	University of Cincinnati	Agree	5
Fadhel Kaboub	Denison University	Uncertain	10	Tuition increases are directly related to 1/ lack of state/federal funding to public colleges and universities, 2/ rising cost of healthcare, energy, and construction/maintenance required to operate institutions of higher education. Cancelling student debt helps students, but it does not help colleges reduce the cost of doing business.
Charles Kroncke	Mount Saint Joseph University	Strongly Agree	10
Trevon Logan	Ohio State University	Uncertain	8
Joe Nowakowski	Muskingum University	Uncertain	5
Cort Rodet	Ohio University	Uncertain	10	The answer to this question depends on how forgiveness is financed, who qualifies and when. If forgiveness is a one time event and mostly affects borrowers who have already left university, then I wouldn't anticipate forgiveness driving up tuition costs. Forgiveness isn't like a grant or easy credit, which tend to increase demand for higher education, leading to greater tuition costs.
Lewis Sage	Baldwin Wallace University	Strongly Disagree	9
Dean Snyder	Antioch College	Disagree	5
Kay E. Strong	Independent	Disagree	9
Albert Sumell	Youngstown State University	Strongly Disagree	10	State Universities would not be able to increase tuition because of a state a student loan forgiveness program.
Ejindu Ume	Miami University	Disagree	6
Rachel Wilson	Wittenberg University	Uncertain	6	If it became regularly done then it would be incorporated into the expected price thus universities could increase their price.

Question C: A state student loan forgiveness program would increase inflation.

Economist	Institution	Opinion	Confidence	Comment
Jonathan Andreas	Bluffton University	Strongly Disagree	10	No measurable effect because inflation is everywhere and always a nationwide phenomena, and this Ohio program is simply far too small to have any discernible effect. The state routinely makes much bigger fiscal changes that have had no effect. Plus the state has a constitutional balanced budget requirement, so the state would have to make a contractionary adjustment elsewhere in the budget. Even if it could have a measurable effect on inflation, the Fed would adjust monetary policy to keep inflation on target, so there is simply no way it could cause inflation.
Bizuayehu Bedane	Marietta College	Uncertain	8
David Brasington	University of Cincinnati	Agree	4
Kevin Egan	University of Toledo	Disagree	8	Inflation is a national issue. Federal student debt forgiveness was expected to have a very small impact so just Ohio would be about zero. My preference is for the federal govt. to expand pell grants and the State of Ohio could do its own Pell grant program for students in need and then also have loan repayments based on a percent of income earned.
Bob Gitter	Ohio Wesleyan University	Strongly Disagree	9	I don't think the increased spending by this one group would cause enough of an impact to matter.
Nancy Haskell	University of Dayton	Uncertain	5	Same comments as above.
Paul Holmes	Ashland University	Disagree	8	The amounts of loan forgiveness proposed would have a small effect on disposable income, and only for a relatively small group of people. If this spending had to be offset in a balanced budget context, I wouldn't expect much of an effect on the overall economy, and particularly not on overall price levels.
Michael Jones	University of Cincinnati	Strongly Agree	8
Fadhel Kaboub	Denison University	Strongly Disagree	10	The main sources of inflation in the US are healthcare, energy, transportation, real estate, pandemic-induced global supply chain disruptions, and Russia-Ukraine conflict/sanctions. Cancelling or keeping student debt does not affect the main drivers of inflation.
Charles Kroncke	Mount Saint Joseph University	Disagree	10
Trevon Logan	Ohio State University	Disagree	7
Joe Nowakowski	Muskingum University	Disagree	8
Cort Rodet	Ohio University	Uncertain	10	A Biden-like plan would wipe out a huge chunk of debt. Nearly $17B for Ohioans. That's huge. But inflationary pressure probably comes down to how forgiveness affects spendable income. If most borrowers are on income driven repayment plans, forgiveness could add $100-$200 to their monthly spending. That's not likely to lead to inflation. But it's nearly impossible to judge because it comes down to how much individuals or household owe, what their current earnings look like, and what their current payments look like. Sources cite how much overall debt there is among Ohioans, but it would be more useful to see debt broken down by income and the distribution of debt payments.
Lewis Sage	Baldwin Wallace University	Strongly Disagree	10
Dean Snyder	Antioch College	Disagree	8
Kay E. Strong	Independent	Disagree	9	"Inflation is Always and Everywhere a Monetary Phenomenon"---Milton Friedman
Albert Sumell	Youngstown State University	Strongly Disagree	10	If it had any impact on inflation it would so negligible that it couldn't be measured.
Ejindu Ume	Miami University	Uncertain	7
Rachel Wilson	Wittenberg University	Disagree	6