Why Much Of The Student Loan Debt Relief Outrage Is Based On Racism And Miseducation (2024)

FAQs

Why Much Of The Student Loan Debt Relief Outrage Is Based On Racism And Miseducation? ›

Much of the ire over the student loan debt relief decision is based on a lack of knowledge and awareness about how different communities have been and continue to be historically marginalized, excluded, and disenfranchised. Racist laws contributed to financial instability and insecurity within marginalized communities.

For decades, there had been enthusiastic bipartisan agreement that states should fund high-quality public colleges so that their youth could receive higher education for free or nearly so. As a result of this ideological swing, student loan debt began to mount.

Most of the outrage about loan forgiveness is coming from the right, and it is in line with longstanding conservative talking points about hardworking taxpayers being taken advantage of by the indolent poor. The principle underlying the response, though, is bipartisan… .

Black students take out the most student loan debt for a bachelor's degree, followed by white students. Black bachelor's degree holders have an average of $52,000 in student debt. Eighty-six percent of Black students take out student loans to pay for college, compared to 68 percent of white students.

Consider that 65 percent of the country has not attended college and, therefore, has no student loans. Biden's call to forgive debt for college graduates illuminates an elitist disregard for other kinds of debt—often incurred without a choice. It's classist, uncharitable, elitist, and unfair toward most Americans.

Soaring college costs and pressure to compete in the job marketplace are big factors for student loan debt. Student loans are the most common form of educational debt, followed by credit cards and other types of credit. Borrowers who don't complete their degrees are more likely to default.

More debt and less support have undeniably led to long-term debt burden and severe financial consequences. Although more students of color are attending college and pursuing the “American Dream,” student debt has delayed them from purchasing homes, starting businesses, and building generational wealth.

Possible Negative Consequences of Canceled Student Debt

Education costs skyrocketed in the years following the launch of the federal student loan program; economists posit that widespread loan forgiveness will cause another surge in costs for the next generation of students.

It's no wonder that many Americans want student loan debt canceled: In a 2020 survey by BestColleges, 40% said they supported federal student debt cancellation. And almost three-quarters (72%) of indebted students said they supported cancellation.

Which gender has more debt? ›

Women are stereotypically seen as irresponsible spenders, but the data doesn't back this up. According to a 2019 Experian study, men carry more debt than women across nearly all categories, including credit card debt — the study found that men have $125 more in credit card debt than women on average.

Black college graduates have nearly $25,000 more student loan debt: an average of $52,726 in student debt, compared to $28,006 for the typical White bachelor's graduate.

Approximately three-quarters of Black- and White-headed families have debt, but the median debt-to-asset ratio is 50% higher among Black than White families (Copeland, 2020), with Black borrowers less likely to fully repay loans (Brevoort et al., 2021).

If the debt forgiveness program is permitted to move forward, at a time when consumer spending already is high, it could lead to more inflation, Jones said. “We certainly don't have a consumer spending problem right now,” he said. “Just last month, we saw some of the highest consumer spending numbers in two years.

Three of the major arguments in favor of broad student debt cancellation are: Student loan debt slows new business growth and limits consumer spending. Broad student loan debt forgiveness may help boost the national economy by making it more affordable for borrowers to participate in it.

In Massachusetts, Nelnet was accused of failing to communicate with borrowers about renewing income-drive repayment plans, which are more affordable payment schedules built on the borrower's income and family size instead of the balance on their loan.

As you can see below, the average student debt by state is only about $40,000 or less. However, more than 2.6 million borrowers have an average student debt greater than $100,000. And to top it all off, 14.4 million borrowers aged 35-49 have a staggering total of $622 billion in US student debt.

The annual amount borrowed declined by a smaller amount as the economy recovered, indicating that the main reason for the increased borrowing was not the decline in parental transfers or part-time job opportunities during the recessionary period, but rather the steady increase in the average cost of college.

History. Student Debt Crisis Center was established in 2014 as Student Debt Crisis, a 501(c)(4) advocacy corporation.

Signs of trouble with student borrowing began to appear by the late 1980s. In 1986, parents and students had incurred nearly $10 billion in federal student loans – then considered an outrageous amount.