Yay! Joe Biden Reduces Student Debt
Now it's time for politicians and higher education professionals to stop generating it
It’s that back-to-school time of year. Do you know someone who just signed off on some student loans? Why not share this post and urge them to:
Today, Joe Biden announced another much-anticipated phase in his ongoing campaign to provide student loan relief. Borrowers who make less than $125,000 (or couples who make less than $250,000) a year will be forgiven $10,000 of whatever they owe, and people who were Pell Grant eligible, $20,000. The pause on repayment has been extended until December to give borrowers time to apply for relief and, presumably, the federal government time to process it.
Before today’s announcement, the Biden administration had already canceled $32 billion in student debt. This number includes loans accrued at defunct, predatory, for-profit universities. It also included debt held by borrowers whose applications for forgiveness, made under a program established by the Obama administration for Americans who went into public service, went unprocessed by Donald Trump's Secretary of Education, Betsy DeVos.
Although I could not find a final number for the new phase of debt relief that began today, according to a Biden administration official cited by Fox News, "if all borrowers claim the relief that they are entitled to, 43 million federal student loan borrowers will benefit, and of those, 20 million will have their debt completely canceled."
“Additionally,” Phil Mattingly, Katie Lobosco, and Maegan Vazquez report at CNN.com,
the department is proposing a federal rule aimed at making the student loan system more manageable for current and future borrowers.
The proposed rule would change income-based repayment for student loans, cutting in half the amount borrowers would have to pay each month on their undergraduate loans, "while borrowers with both undergraduate and graduate loans will pay a weighted average rate."
The proposal would also "raise the amount of income that is considered non-discretionary income and therefore protected from repayment." And it would forgive loan balances after 10 years of payments rather than 20 years under many income-driven repayment plans for borrowers with original loan balances of $12,000 or less, the department said.
The proposed rule includes other changes, like simplifying borrowers' choices among loan repayment plans.
Even though it is not complete amnesty, loan forgiveness on this scale is a huge deal: about 9 million borrowers will have their student debt eliminated under the new rule. It also caps repayment at 5% of monthly income, a system standard in countries like Australia. It is also essential to make the repayment system (which in the past has been outsourced to predatory companies that rip customers off relentlessly) transparent and easy to comply with. There’s more than one horror story of a borrower who regularly pays every month, only to see their student loan debt grow over the years.
Although it isn’t everything I would have wanted, today’s announcement is excellent news. It is also timed to draw a very sharp distinction, as we turn the corner into midterm election season, between how Democrats govern and how Republicans govern.
But here’s my question: when does the United States government plan to hold private institutions and state legislatures, who have shifted the cost of public higher education onto students over the past several decades, accountable for producing this debt in the first place?
I don’t see this conversation in the offing, and it is desperately needed as tuitions climb even further out of the range of a middle-class, much less a working-class, family income. One argument against debt relief has been that, without changes to the current system of tuition-based support for higher ed (I fulminated about it here in 2020), the new debt will quickly replace the old debt.
Why? Because higher education is unaffordable: 60% of white students, and a whopping 86.6% of Black students, take out loans for their education. According to Forbes Magazine, 57% of students who attend private, four-year colleges take out loans. Still, the shocking figure is that 55% of students who attend public institutions also take out loans.
Debt forgiveness does not change the predatory economic structure of all higher education, nor does it alter the topsy-turvy logic of who education is for. Instead of being perceived as a social good and an educated citizenry as a national resource, which was the case in the decades after World War II, education is perceived as only good for the individual. Thus, individuals and their families are responsible for educating themselves: and private banks and financial companies make billions annually from servicing these loans.
Until that changes, useful as one-time debt forgiveness programs are, the student loan problem cannot, and will not, be solved.
Short takes:
“That sound you hear is the crash of expectations of big GOP gains in the House this fall,” write Amy Walter, Jessica Taylor, and David Wasserman at the non-partisan Cook Political Report after last night’s primaries in New York and Florida. Democrats who don’t usually vote in primaries are coming out in large numbers, resulting in a surprise victory in a special election in NY-19, “the kind of district they need to win to have any chance of rolling up big numbers in November.” Although the folks at Cook still expect the GOP to take the House, they admit that Dobbs has shifted voters “meaningfully” towards the Democrats. (August 24, 2022)
Today would have been Howard Zinn’s 100th birthday. Whether you are a fan of A People’s History of the United States or not, it is impossible to deny that Zinn changed the role that history could play in mobilizing political change. He also sparked conversations among historians about our job as teachers, scholars, and citizens. “Part of what made A People’s History so popular was Zinn’s candor about his biases,” wrote Robert Cohen and Sonia Murrow at The Nation. “Zinn made no pretense of neutrality—a bold departure from bland textbooks. In one of the most memorable passages from the book’s opening chapter, Zinn made such a neutral pose sound amoral.” (August 24, 2022)
Although one outlier poll says the race is closer, most put GOP gubernatorial candidate Doug Mastroiano a good 10-15 points behind Democrat Josh Shapiro. Which is a good thing because not only is Mastroiano an election denier, but he is campaigning with a self-proclaimed prophet named Julie Greene who, according to Eric Hananoki at Media Matters, says that God is going execute Democrats for “for their planned pandemic, shortages, inflation, mandates and for stealing an election.” She also told crowds that Nancy Pelosi drinks the blood of little children, that “the government is conducting `human sacrifices’ to stay in power,” and that President Joe Biden is dead and being played by an actor. (August 17, 2022)
Out of control student debt (and the withdrawal of financial support for education that helped cause it) was one of the main problems that developed in higher education during my lifetime. I entered college in 1960. I was from a working class family that couldn't afford to fund me but I got a first rate education at public institutions (Rutgers then UCLA) paying my own way and not having to take out loans. Right through to a Ph.D. The change in funding that cut public funding and put the burden on the individual student was especially hard on adult students who didn't have families to foot the bill or good financial aid support. It broke my heart to see them loading up credit cards and taking out loans. Biden's actions aren't perfect but they're a step in the right direction and a recognition that it's not good for society to put the burden of education on the individual student. Education is good for society. It wasn't just a post WWII GI bill idea either. Abraham Lincoln started the land grant colleges in the middle of the Civil War because he, and other politicians, saw that an educated population was needed to build the country and save the union. It was an economically smart thing to do and it was a necessity for a democracy. What made our generation so stupid that we (or our "leaders") couldn't see that?
When are we (as a profession? as a collectivity? ) going to take on what are basically predatory humanities MA programs that have mushroomed post 2007/8? My experience with them as an onlooker who pretends they are on board is that in some depts they operate as a slush fund for the dept’s other programs and faculty enrichment. At issue is that faculty are mobilized to leverage their mentoring relationships with bright undergraduates-many of whom are first generation (and who are led to believe that more credentials =better job prospects). Faculty then benefit bc the MA tuition revenue fund PhD students/fellowships, research $, and reduced undergraduate teaching loads. Amidst institutional budget cuts, it is an easy means of getting revenue for these projects without having to fight the university’s admin. This structure essentially externalizes the cost of myriad forms of the aforementioned faculty enrichment onto young people who are saddled with the loans for the MA. Given the cost of these programs, even a 6-month non-paying internship would probably go farther to achieve what the MA student wants at far less expense. And yes, some MA programs can be a gateway to acceptance at a fully funded humanities PhD program. But if the student isn’t a candidate for those as an undergraduate, is it honest to steer them into an MA program and tons of debt on the grounds that they may end up one day have a minuscule chance at becoming a tenure track professor making less than six figures to pay back that debt? It all feels like kicking the can down the road. And that it won’t get discussed bc it enables depts in R2 and R3 to hobble along post crash.