Would You "Pay It Forward" to Pay for College?

Students at Portland State University developed a proposal that could revolutionize the concept of student debt. How feasible would the program be, and is it fair to all students?

Several states have been considering legislation that could help make it easier and more affordable for students to gain a college education. Through “Pay It Forward” programs, students would be able to attend college without paying for tuition up front and would sign contracts in which they would agree to pay a portion of their future income upon graduating.

The idea of “Pay It Forward” originated with a student-led project at Portland State University in Portland, Oregon, where students in a class on student debt formulated the proposal in December 2012. Shortly thereafter, in July 2013, Oregon became the first state to pass and sign into law legislation directing the state’s Higher Education Coordinating Commission to consider launching a pilot program.

Inspired by the initiative, U.S. Senator Jeff Merkley (D-OR) and U.S. Representatives Suzanne Bonamici (D-OR) and Dan Kildee (D-MI) have introduced The “Pay It Forward” Guaranteed College Affordability Act, which would direct leaders within the federal government to look into implementing a "Pay It Forward" model.

“Pay It Forward” may sound like a convoluted student loan, but it’s not—at least, not quite. Students would be indebted to the state (or federal) government, but the amount they would be required to pay back would depend on their income. For example, a doctor or engineer earning upwards of $100,000 a year would pay back more than a teacher or social worker who earns far less than that.

The upside to “Pay It Forward” is that a student’s education is paid for up front. But detractors argue that it would simply create a loan program in which the borrower isn't clear on how much he or she really owes. Plus, since “Pay It Forward” programs would be income-based, those who earn more would technically be subsidizing (i.e., supporting) those who earn less. But that doesn’t mean there isn’t any value in introducing such programs.

In a recent interview with NPR, Representative Kildee offered his take on the matter.

“This is a way just to make a simple contribution back and bring another student along,” said Kildee. “[It] basically says we are betting on you, that you will make it.”

The NPR piece went on to note that the average college graduate is saddled with $30,000 in debt, which is a sizable burden and may cause low-income students to shy away from going to college at all. But programs like “Pay It Forward” could help.

“It may actually persuade them to take a different path in life,” said Kildee.

What do you think of the concept of “Pay It Forward”? Would you consider participating in this or a similar program instead of relying on traditional financial aid options?

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