Here’s what Republicans get Wrong about the Student Loan Debt crisis
What is exciting about this op-ed is not just the topic but the writer Lisa Ansell. Ms. Ansell is the Associate Director at the Casden Institute for the Study of the Jewish Role in American Life. She definitely has the band width in adding to the fight for student loan relief for the 46 million students having no-way-out from predatory loans. Lisa is writing articles in support of Student Loan Justice Org.
“I’m an independent. Here’s what Republicans get wrong about the student debt crisis,” Opinion – Pennsylvania Capital-Star, Lisa Ansell. May 2023
Earlier this week, the Republican-controlled U.S. House voted to overturn President Joe Biden’s student loan relief plan and to nullify the freeze on federal student loan payments and interest, Politico reported.
As an independent voter, it is infuriating to see Republican leadership continually attempt to render the student debt crisis a partisan issue when one out of 5 adults in this country of all demographics and party affiliations, is burdened by crippling student loan debt.
Contrary to the lending industry backed narrative that dominates the mainstream media, over half of student debt borrowers are either Republican or independent and distressed borrowers over the age of 50 far outnumber borrowers under the age of 25.
In fact, the fastest growing demographic of distressed student loan borrowers are senior citizens who are getting their social security checks garnished over their student loan debt which has ballooned over decades due to usurious negative amortization and compounding interest.
Republican leadership leading the crusade against President Biden’s loan cancellation plan and the recent changes made to the Public Service Loan Forgiveness program and Income Driven Repayment plan receive well-documented massive donations from the lending industry to perpetuate this highly predatory lending system.
For instance, U.S. Rep. Virginia Foxx, R-N.C., who is the chair of the House Education and the Workforce Committee, receives more money from the student loan and for-profit college industry than from any other sector .
In addition, the Congressional Review Act that was recently introduced by GOP U.S. Sens. Bill Cassidy, John Cornyn and Joni Ernst presents no logical solution to the close to $2 trillion crisis but rather falls back on stale tropes such as why should tax dollars be spent on student debt relief and not for the “man who skipped college but is paying off his work truck.“
The reality is that unlike PPP loans, student debt cancellation would require zero dollars to be drawn from the treasury and will add nothing to the national debt. In fact, the vast majority of the $2 trillion student debt burden is comprised of usurious fees and compounded interest.
If the GOP were serious about addressing the plague of student debt that has destroyed the lives and livelihoods of now four generations, they would fight to restore bankruptcy protections back to student loans.
Specifically, Cornyn co-authored the “Fresh Start Through Bankruptcy Act” last year in a bipartisan effort along with U.S. Sen. Dick Durbin, D-Ill., but this bill never even made it to a vote in the Judiciary Committee.
For a party claiming to preserve the integrity of the Constitution, where is the outrage that the constitutional right to declare bankruptcy was uniquely stripped from student loan debt first in 1977 for federal student loans and then in 2005 for private student loans both in large part due to the current occupant of the White House?
The states of Louisiana, Texas, and Iowa where the three authors of the Congressional Review Act hail from, are all underwater in student loan debt where the citizens of these states owe more in student loan debt than their entire state budgets.
The sooner these representatives who were elected to champion for the material lives of their constituents realize that the root of the student debt crisis lies not in fighting Biden’s meager $10,000 to $20,000 cancellation plan but rather in the lack of consumer protections for student debtors, the closer they will get to solving this crisis.
Lisa Ansell is the associate director of the Casden Institute at the University of Southern California/Dornsife.
Many Americans face serious problems of not enough money versus their costs, including debt payments. There are a couple of elements to this program that feel arbitrary and hence are viewed by many as unfair.
The first is selecting student debt as a necessary prerequisite for aid. Well it really is unfair but doesn’t mean it isn’t a worthy program.
The second is universal nature of it….everyone get $10k except those that get $20k. Why isn’t the same sized relief skewed towards those that actually need $35,000 at the expense of those who need $0? So it will be unfair to a degree and not well-targeted.
I see only two basic choices: just ignore critics or seriously address at least these two elements in some manner. I suggest ignoring, so I think articles like this are foolish in a way. There is an imperfect plan, that advocates believe worth doing. Don’t waste efforts trying to wordsmith arguments aimed at critics that correctly identify those imperfections. Just steamroller it (if you can).
Isn’t the Supreme Court case mostly an up or down decision? Does it even matter how anyone apart from 9 justices think about this?
I like this article. It shows that we really haven’t spending, pre-pandemic, that much money on loans as the huge majority of loans are paid back. If you account for administrative costs and interest (present vs future value of money) we have either been making money on student loans, Obama years, or losing 1%-4%. Given that, from memory, we loan out about $80 billion/year that means we lose about $1-$3 billion/year. Lveral, the student loan program is a success and we can afford to alleviate the load on those who are unable to pay given that we dont afford bankruptcy protection like we do most other loans.
Does The Government Profit Off Of Student Loans?
Steve