Bernie Sanders has announced a plan to wipe out all $1.6 trillion of student debt in America by taxing Wall Street more.
The Democratic presidential candidate announced today (June 24) his ambitious plan to cancel student debt completely, while paying off the debt owed by more than 40 million Americans.
The plan will reportedly have no eligibility criteria and will be available to both the nation’s federal student loan borrowers and private student loan borrowers.
Sanders says he will fund his student loan forgiveness plan through a new tax on Wall Street transactions, which he believes could raise more than $2 trillion over the next decade, Washington Post reports, as per Forbes.
The senator’s plan will place a 0.5 per cent tax on stock trades, as well as a 0.1 per cent fee for bond trades and a 0.005 per cent fee on all derivatives trades.
The plan, which aims to help current and future students by easing their financial struggles, is not the first to address the nation’s increasing problem of student debt – although it is the most ambitious.
As reported by CBS News, Sanders’ rival for the 2020 Democratic presidential nomination, Senator Elizabeth Warren, also issued a plan to forgive student debt in April.
Differing to Sanders’ slightly, this plan aimed to add an annual two per cent tax on wealth above $50 million, and a one per cent tax on wealth above $1 billion. Despite the obvious differences, both plans aim to reduce the financial burden felt by the middle class by taxing the wealthy.
Sanders also said his plan would provide $48 billion in state funding to provide free tuition at state colleges and universities.
A statement on Sanders’ campaign website states: ‘We will free generations of Americans from the outrageous burden of student loans by canceling all existing student debt’.
In a tweet sent out earlier today, Sanders wrote:
Are you truly free if you graduate hundreds of thousands of dollars in debt?
Are you free if you cannot pursue your dream because you don’t make enough to cover your student loan payments?
We will #CancelStudentDebt because there is no freedom without economic freedom.
This isn’t the first time Sanders has suggested taxing Wall Street, Markets Insider reports.
The presidential hopeful also proposed a similar plan with a financial-transaction tax during his 2016 campaign.
Sanders, along with 19 other candidates, will discuss his plans in more detail in the first Democratic primary debate on Wednesday June 26 and Thursday June 27.
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