The banks were bailed out, and automakers got help, too. Even some people who bought more house than they could afford are getting relief.
But as the economy still sputters along, Robert Applebaum thinks he has a better idea: Cancel all the outstanding student loan debt. The impact would be immediate, he says, as people paying hundreds of dollars a month on their student loans could instead spend that money elsewhere.
The seemingly fanciful idea has hit a nerve. Since Applebaum, a New York lawyer, started a Facebook group on Jan. 29, more than 156,000 people have joined and 40,000 have signed a petition intended to be sent to Congress. Applebaum, who owes about $96,000 on law school loans, has become a full-time spokesman for the cause.
"I see it as targeted relief to people who are obviously lower and middle class, and it rewards responsibility," said Applebaum, 35. "These people didn't take out these loans to live high on the hog. They did it to better themselves."
He estimates that all private and publicly held student debt in the country totals about $600 billion - far less, he notes, than what has gone to banks that have used the money, in part, to pay out unpopular bonuses.
But economists are not as enamored of the idea. If student loan debt is forgiven, they say, why not car loans or credit card debt? And they say that the graduates who took out the loans are benefiting considerably from them in the form of higher earning power and that most are able to pay off their debts over time.
"Let's talk about forgiving everybody's loans. Anything along those lines would stimulate the economy, but at some point we have to say enough is enough," said David Ribar, professor of economics at the University of North Carolina at Greensboro. There's also a basic fairness issue, he said.
"Think of the poor kid who for one reason or another refused to take out loans, didn't go to college and is now making decent money," Ribar said. "That person now has to pay taxes so somebody else's loan can be forgiven? That doesn't seem very fair."
But for those who have student loans, the burden could keep them from buying a house or starting a business. Josh Lampman of Hampden is getting his master's degree this spring from the Maryland Institute College of Art, in photography and electronic media. Between his four years at Virginia Wesleyan College and two years at MICA, he has racked up $180,000 in debt.
