Gov. LePage is on exactly the right track when he identifies the student debt crisis as a prime target for government action.
In his radio address last week, the governor cast investment in people as a critical economic development tool for our aging state. By helping college graduates get out from under crushing debt, Maine could tackle its biggest economic problem – a workforce that is shrinking.
“For our state to continue to grow, it must become easier for graduates to stay in Maine, and we must attract talented young people here. Not only will these young people work in our industries, but they will also buy homes, invigorate our communities and have children …
“We can invest in our young people by relieving the burden of student debt for those who want to stay in Maine or choose to relocate here and start their professional careers.”
What LePage proposes, a tax credit for businesses that help employees pay off their loans, is a good start, but it is not the transformational action that will turn around our demographic trends. More Mainers still celebrate their 65th birthday every year than graduate from high school, and modest loan assistance is not going to change that trend.
Maine still ranks near the bottom fifth of the states for income, and the cost of living is relatively high, when you take into account winter heating and transportation.
In his radio address, however, LePage puts the issue in the right context. He compared investing in people to investing in infrastructure or research and development.
Just like those public goods, student debt relief does not have an immediate payoff. But just like building a new bridge or funding a lab, adding highly skilled cohorts to the workforce attracts private sector investment and profit-making ventures.
As with other long-term investments the state makes, Maine should consider bonding to create a loan forgiveness fund, that could be used to make the governor’s vision possible. Sen. Nate Libby, D-Lewiston, proposed that idea last year but couldn’t get the support needed in the Legislature, despite the governor’s backing.
Libby’s bill would issue a $100 million bond for student debt forgiveness and refinancing. Eligible graduates working in Maine could shave 15 percent off their debt per year of work. In six years, the average employee would be debt-free.
The bill will be coming back to the Legislature this year, and lawmakers should take advantage of this opportunity to put partisanship aside and invest in Maine’s future.
The governor is on the right track. The Legislature should make this idea go all the way.
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