Pay It Forward Plan: Oregon's Student Debt Solution is Creative, But Is it Feasible?

Oregon has taken the first steps in an attempt to combat the trillion-dollar student loan problem in the United States with its "Pay It Forward, Pay Back" plan. Although it would take years to implement, the gist of HB3472 would be to ultimately have Oregon students at the community and public level attend college tuition-free. In return, these students would have to pay a small amount of their income for 20 years to offset the cost of instruction for the up-and-coming generation of students. Despite the hopeful nature of plan, it is still not without flaws that make it difficult to see a real difference in the game of student loans if it were implemented.

Still, there's some merit to be seen in its ambition.

The bill originated from a Portland State University course that produced a senior capstone project where students studied the debt crisis in depth. Barbara Dudley, an instructor for the course and a crucial member of the Oregon Working Families political party came across an actual solution through the Economic Opportunity Institute, authored by Audrey Peek and John Burbank. Outlined somewhat poetically in their joint effort, the Pay It Forward approach sees itself as the reclamation of the American Dream. It's a dream that's fallen on hard times for the millennial generation.

The reality is that it's really no fun graduating with thousands of dollars in debt for a B.A. degree that for all intent and purposes is the new high school diploma. But without a B.A., it is difficult to find a job that pays well; and B.A.'s rarely guarantee that a well-paying job is in the works following graduation. To make matters worse, on July 1 congressional inaction doubled the subsidized federal Stafford student loan rate from 3.4 to a whopping 6.8%. And it will remain that way if nothing is done to change it.

Let's take a minute to skip across the pond to see how our European counterparts are fairing. Is the American debt crush a phenomenon truly limited to the good ol' US of A?

Not quite. 

Matt Phillips wrote a piece for the Atlantic that focused on Sweden in particular. Attending college is free, but students are still burdened with debt, and benefit at the full maximum from loans, grants, and scholarships. Even so, their debt is made manageable through low interest rates, which allows for Swedish graduates to comfortably step into adulthood. Meanwhile, American graduates are ridden with anxiety and hesitation from goals that include starting up a family or buying a house. That, in turn, impacts the already hard-stricken economy. In the midst of financial crisis for nations even such as Spain, students and the future of their education still remains a priority. 

Oregon's approach and creativity towards founding a tuition-free higher education system is one to take note of; but as it seems with most education systems in the end, it still has costs that can't be escaped. Oregon would require 10 years' worth of start-up funds and tricky in-state vs. out-of-state loopholes to refine. But even if Oregon's plan doesn't actual reality, it could be the starting point towards a more feasible plan in years to come.