House Democrats, this week, reiterated their call for alleviating student loan repayment pressures for startup founders and employees. This time, they made it about the gig economy.
Their pitch: As Millennials scramble to find employment--while also paying massive student loans--the U.S. government has a responsibility to adapt to these workers with policies that aim to help. Democrats including Nydia Velázquez, (D, N.Y.) the ranking Democrat on the House Small Business Committee, suggested improving health care benefits for on-demand workers, along with opportunities to erase some or all of their student debt. In 2017, Velázquez introduced a bill, dubbed the Supporting America's Young Entrepreneurs Act, which would allow student loan borrowers who are either employed by a startup or who founded one to defer student loan payments or even cancel out some of their debt in some cases.
"While many of the workers in the gig economy enjoy flexibility, they must be protected from unscrupulous business practices," said Velázquez in a statement. "As this technological revolution advances, government policy must keep pace. It is therefore important that Democrats offer solutions to minimize risk for millennial employees, while maximizing growth and productivity for small businesses."
As it turns out, those same policies could help small businesses, too. Tay Lotte is a student at Syracuse University and co-founder of Ravle, a startup focusing on travel filmmaking that was featured as one of Inc.'s Coolest College Startups. She said after starting her business, she switched to a part-time degree because it was more cost effective.
"When we have those burdens coming out of school, it can sometimes cloud our judgment and not allow us to focus as much of our time on our startup because I can find myself getting concerned with my financials," Lotte said.
Lotte is hardly alone. Student loan debt has risen astronomically over the years, with Americans owing $1.3 trillion in student loans, over 2.5 times what they owed a decade ago.
"We need young people to be willing to start new firms, but today many are being deterred by mounting student loans," said Velázquez. "My legislation would invest in our young people and give them the breathing room they need to start new enterprises and create jobs in their communities."
Whether this new pitch will fall on deaf ears remains to be seen. The bill has been referred to the House Committee on Education and the Workforce.
Even so, Velázquez is hopeful. After all, circumstances young people now face will demand a reckoning--and soon. "With public sentiment acknowledging the urgent student loan crisis, the Congresswoman believes that support will continue to build for her bill," a Velázquez spokesperson told Inc. by email.