Many young people are discovering a historical secret: There was a time, only a few decades ago, when almost all Americans could find a way to attend college or university (like the University of California or New York University) and emerge with a degree without going into debt. Today, a new generation has begun to rebel against an education-financial system that seems to take for granted the imposition of huge debts – often over $200,000 in student loans – for the privilege of competing for decent jobs in a Hunger Games-style economy.
On Monday, Hillary Clinton responded to the emerging Student Debt Voter movement with her own plan to reduce the cost of college education and reduce the burden of student debt. She calls it her New College Compact, presented at a forum in New Hampshire. (Video and transcript.) While not as ambitious as the plans advanced by her competitors for the Democratic nomination, Sen. Bernie Sanders (I-Vt.) and former Maryland Gov. Martin O’Malley, Clinton’s proposals are large in scale, and they set a goal of making it possible to attend public colleges and universities and graduate debt-free – but there will surely be a debate over whether her plan might still force students or parents to take on debt to pay for room and board. She also pulls together many of the best proposals out there – some advanced by Sen. Elizabeth Warren (D-Mass.) – to help people who are struggling to pay off their student loans by renegotiating interest rates and by adjusting debt payments to match people’s incomes.
Millennial activists and education experts will soon publish comparative analyses of the different parts of the Clinton proposals and those of her Democratic rivals. So we won’t do that here. But it is important to stress that Democrats are now debating the relative strengths and weaknesses of these three bold plans as a result of energetic and effective organizing campaign on the part of progressive activists – working closely with populist leaders in the Congress like Warren and the leaders of the Progressive Caucus – and like Sanders. Here’s how we made it happen.
Warren has been working steadily to take the student loan system out of the hands of the private bankers and into the domain of public sector. And she has also sought to reduce profiteering on student loans, lowering interest rates and the overall costs our loan-based system imposes on students and their families. Coalitions like Higher Ed, Not Debt have pushed for repayment systems that adjust payments to actual income of the people struggling to repay. And the steadily building pressure of this growing effort to rationalize the system led many to ask why we have a debt-based system at all – a system where $1.3 trillion in debt now burdens and distorts the lives of over 41 million people in America.
All this public pressure led President Obama to propose an important step forward: his plan for two years of tuition-free community college. If two years is a good idea, what about four years of free college at any public university? Almost immediately, groups like the Progressive Change Campaign Committee got to work building support for this even bolder idea. Leaders of the Progressive Caucus joined with Senator Warren and others to introduce a congressional resolution urging that all students who attend public colleges and universities have access to debt-free college educations. PCCC, with the help of eight other groups (including our Campaign for America’s Future), gathered over 400,000 signatures on a petition in support.
Only a few months later, all of the major Democratic candidates for president have embraced the idea of four-year debt free college. All acknowledge that this part of their plan will cost money – federal money (raised via increasing taxes). New money will go to state universities on the condition that the states put in additional funds (reversing the trend of cutbacks in recent decades) to achieve a level of financing where tuition can be eliminated or reduced to manageable levels.
Sanders would spend $47 billion per year to eliminate tuition and fees, with states covering 33 percent of the costs of getting rid of tuition (which now total $70 billion per year). Clinton said her whole plan would cost $350 billion over 10 years with more than half going to grants to states to reduce tuition (that’s at least $20 billion per year for reducing tuition costs under her plan). The debate now becomes whose plan is big enough to make college debt-free – along with all the other details focused on cost controls, increasing Pell Grants, and special outreach to populations who wouldn’t normally think about higher education. But this will be a very productive debate – advancing the details of an idea that only a few months ago only a few were taking seriously. And, it must be said, one of those pioneers was Sen. Bernie Sanders.
There is another part of the grassroots movement for debt-free college – and that has to do with relieving $1.3 trillion in student debt that now burdens the several generations of Americans that had no choice but to take on debt to finance their education. If we move to a system that makes college debt-free, it is only right that the 41 million struggling to deal with that debt should get some relief. IAF’s National Student Debt Jubilee Project, led by Mary and Steven Swig, argues that wiping out all student debt (based on a time-honored practical and moral Jubilee practice) would be good for all Americans because it would stimulate the economy, creating jobs and growth. The idea is a common-sense one: the people now forced to labor at jobs they hate would be liberated to create new businesses they invest with creativity. Younger workers (rapidly aging) would be freed of debt and able to get married, start families, buy houses and cars – and the debt forgiven would inject new life into a struggling economy.
It must be said that none of the presidential candidates have stepped up to the plate on the overall burden of debt, except through half-measures, like negotiating lower rates or better payment terms. But the organizing has begun: “ Sen. Warren Receives 240,000 Signatures Asking CANCEL ALL STUDENT DEBT.“
There are two areas where immediate debt relief seems obvious:
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Free the Corinthian 100+. This article describes the growing movement to demand debt forgiveness for the many, many young people who were lured into taking on student debt by rip-off for-profit colleges, like Corinthian and others, who delivered a bad education and then went bankrupt, leaving their students with a lousy education and bad employment prospects but with a large burden of student debt. Over 100 brave former students have gone on strike, refusing to pay their debt payments. The resulting movement has gotten the Education Department to acknowledge they have the power to wipe out these debts, and the resulting movement has pressured the Department to (far too slowly) begin to set up mechanisms for these people to free themselves from the dead weight of their student debt. We should all support this proposition: If a college rips off students and leaves them stranded, they should not have to pay those debts. They should be able to get on with their lives.
Don’t Let Student Debt Haunt Americans to the Grave. Many seniors – 706,000 households headed by someone 65 or older – are still paying off their student debt, according to a report by the GAO. Collectively these households owed $18.2 billion in 2013. The government can take up to 15 percent of a Social Security check to pay back a student loan, as long as the monthly check amount does not drop below $750 a month. Social Security payments could not be seized for any reason until – for the first time ever – Congress created an exception for student debt in 1996. The original Social Security Act of 1935 stated that benefits were not “subject to execution, levy, attachment, garnishment, or other legal process, or to the operation of any bankruptcy or insolvency law.”
Surely America can and should establish the principle that, having been forced to take on debt during this aberrational period, those Americans who reach the age of 65 and are depending on Social Security for most of their income should not have to continue to pay off what remains of student loans from their Social Security checks.
Interestingly, there was one line in Clinton’s speech on Monday that points in this direction. Speaking of her limited debt reform proposals, she declared: “Your debt will only last for a fixed period of time. It will not hang over your head forever.” That should obviously mean that debt should not last until you get to Social Security age. It is a start toward a debt jubilee.
Debt-Free College and Action on Debt Can Win Primaries – and the General Election
Many people can claim credit for Hillary Clinton’s New Compact plan. Clearly, as she acknowledged in her speech on the future of college education and debt, she was responding to our organizing, including, she said, “young progressive activists who have put the issue of student debt at the top of the agenda.” We at the Campaign for America’s Future, working with groups like Young Invincibles to make sure that Clinton and the other candidates are confronted at every stop by young people in our t-shirt that declare I AM A STUDENT DEBT VOTER. ( You can get those t-shirts here.) And here’s Clinton with one of those “young progressive activists” in Iowa:
Clearly, Bernie Sanders, Martin O’Malley, and Hillary Clinton all think of themselves as champions of debt-free college – and of reducing the burden of past student debt. They also think that their proposals give them a winning edge in the Democratic caucuses and primaries. Those of us who put these issues on the table should push to get them to debate in order to explain and improve their plans.
Take It To the General Election
But we need to make sure that our progressive college affordability ideas are made big winning issues in the general election. So far, we have heard nothing but bromides – and some of them dangerous – from the large number of Republicans running win the White House. None of them identify with President Dwight Eisenhower, a Republican who actually believed in investing in infrastructure and education. And their ideological blinders make them unable to be as creative as the Eisenhower Republicans (and the Veterans of Foreign Wars) who supported the vast investments in the GI Bill that today’s Republicans would consider unaffordable.
The Asbury Park Press, reports that Gov. Chris Christie, in an interview on Fox & Friends, “said the top two issues people in New Hampshire ask him about are terrorism, specifically the Islamic State, and student debt accumulated by college students.” We know that Christie and all the others have a lot to say about terrorism, much of it wrong – but what do they have to say to the many, many Americans, including lots of Republicans, who are standing up at town halls and asking them what they would do about student debt?
The video the Clinton campaign released with her plan contains a good line: “Higher education should be a right – not a privilege for those who can afford it.”
Rebuilding our higher education system so that everyone who wants one can get a post-high school education – debt-free – can be a winning issue in the 2016 election. But we are going to have to work hard to keep it on the front burner as a very important part of the economic debate.