Alexander Pope, an 18th century English poet, wrote in his An Essay on Criticism that “to err is human, to forgive divine.”

In that spirit, Wy Spano, the director of the Master of Advocacy and Political Leadership (MAPL) program at the University of Minnesota Duluth, recently wrote an article (Want to stimulate the economy? Forgive student debt) in the Minneapolis-St. Paul Star Tribune. Spano suggests that - as part of President Obama’s stimulus package - all federal student loans owed should be paid off in order to make education affordable for everyone. He estimates that this would cost a little under $70 billion - less than 10 percent of the $825 billion bill.

Spano suggests that this forgiveness would make it possible for student debtors to become active consumers. The money that the student debtors would have paid toward their loans would be available to put towards a job loss, a car or to pay off other debts. The basis for his suggestion is that stimulus money is aimed at institutions of higher learning, not at students or tuition levels. He maintains that ultimately, the cost of higher education needs to be dramatically reduced.

What are your thoughts on this idea? Should we forgive all student debt? Is it a good use of funds in the stimulus package? Is it fair to those students that have already paid their loans, students and families that have sacrificed to not go in debt, or for all citizens to pay for the educational costs of others? What would you like to see Congress spend stimulus money on?

Student loan providers were reeling last week, and it looks like students - especially low-income students - will be bearing the brunt of the fallout. Last week, Sallie Mae announced that they would stop making loans at colleges with poor graduation rates - making no differentiation between private and FFEL loans. Nelnet also announced last week that they would be cutting more than 300 jobs and suspending loan consolidations. Other loan providers are having trouble raising capital for new student loans because of bond downgrades and instability in the lending markets.

The Career Colleges Association (CCA) released a statement expressing concern about the pullback in private student loan dollars. CCA President Harris N. Miller said:

“Access to private lending sources is absolutely critical for many working adults to be able to bridge the gap between federal grant and loan program limits and actual tuition costs. Our member institutions tell us that many lenders have stopped subprime private lending and may stop private lending altogether. Their retreat may leave many students unable to finance the balance of their educations.”

Indications tell us that we should be bracing for another recession in the coming months, which usually indicates that many out-of-work individuals may return to school to sharpen their skills. With a pullback in private student loans - and in some cases, federal student loans - I think we have reason to be concerned.

All of these recent actions seem to be the result of a culmination of issues. Troubles in the subprime markets, student loan subsidy cuts from the CCRAA, and lack of sufficient federal aid may all be contributors. The serious question becomes: how many students will be adversely affected by all of this and what should be done about it?

Certainly increasing federal student aid, including the Pell Grant and federal loan limits is a good beginning. Finding a nonpartisan, nonpolitical way to set lender subsidy rates may also be useful to ensure a healthy and sustainable student loan market that remains focused on students.

Still, perhaps it is better to wait and see what happens in the both the private and federal student loan markets. Private student loans - much like subprime mortgages - may never recover. That might not be too bad for some students who would be better off avoiding them altogether.

What are your thoughts and what are you seeing on your campuses? Is it best to wait and see how these markets pan out or does there need to be some sort of immediate action to ensure that FFEL and private loan funds are available to students?