Student Debt Harms the Economy. Everyone Would Benefit From Its Cancellation.

Janine Jackson: An NBC NewsStory headlined “White House Confronts Political Pressure to Extend Pause in Student Loan Payments Ahead of Midterms” represented much media focus on student loan debt: treating the fact that 45 million Americans owe some $1.7 trillion as an “issue,” an object of debate, a potential election factor.

And that’s all true. Student loan forgiveness was one of Biden’s campaign promises. The federal pause on payments is due to expire May 1. What happens to it will impact the president and the party. But, of course, there’s also a much broader and deeper conversation to be had about student loans, and about debt, that hopefully will carry us beyond any particular election cycle.

For an update on the current situation and our understanding of what’s at stake, we’re joined now by Braxton Brewington, press secretary and organizer at the group Debt Collectivea membership-based union for creditors and allies. He joins us by telephone from Washington, DC. Welcome to CounterSpinBraxton Brewington.

Braxton Brewington: Many thanks for having me.

Debt Collective is more than just about StudentThere are reasons to cancel student debt, and this is a particular reason for your work. And/or is this just a moment where there’s energy behind student debt and its impact?

Well, there’s a ton of energy behind student loan debt, which is now getting close to $2 trillion, the second-highest household debt type, behind mortgages — surpassing credit card and medical debt combined. The cost of college has risen eight times faster that wages in the last decade.

All borrowers, young and old, are facing the devastating consequences of student loan debt. We’re not able to purchase a home, we’re having trouble starting a family or having kids, getting married. There’s difficulty in just living a dignified life. It’s crushing, and it’s dragging down our economy.

Now, we know that the president is able to cancel federal student debt by issuing an executive decree. This knowledge I believe is helping Biden solve the crisis with the flick of a pen. And also because, like you said, he ran on fulfilling this promise, there’s reason to suspect that Biden would take on student debt cancellation as a major issue, because this is something that helped get him into office.

There’s a reason that Senate Majority Leader Chuck Schumer co wrote an op-ed with Derrick Johnson, who’s head of the NAACP, about this, because student debt plays a particular role in the Lives — and, as you’re saying, not just the education, but the lives — of Black people, right?

Absolutely. This student debt crisis is particularly affecting Black Americans and Black women. Twenty years after graduating college, the average white borrower had paid off 95% of their student loans, while the average Black borrower only paid off 9%. still owes about 95%You can get a student loan.

90% of Black students have to borrow federal money to attend college. We’ve actually largely closed this gap between Black and white students as to who attends college, but on the back end, Black Americans are having a much more difficult time being able to pay off that loan. They’re having to take out more, because we’ve been stripped of generational wealth, and are more likely to go into default, and face other types of life barriers and consequences that make it difficult to pay off that student debt. This crisis is especially affecting Black Americans. And so that’s why this is exactly a matter of racial justice.

And you’re getting at what I think is so huge about this moment, the very idea that we’re seriously considering canceling debt, in the face of what you might call folk economics — “you borrowed it, you owe it ” — that we’re able to shift the frame of this conversation I think is very meaningful. Debt Collective talks of radical imagination. We have a society that orchestrates these situations in which, to get a degree, you’re told you have to incur a debt that then is going to maybe yoke you for the rest of your life. It’s making it a societal issue, rather than an individual issue. This seems to me to be a major issue.

Yeah, there is this belief that student debtors, and debtors in the 99% in particular, have signed this—it goes beyond the piece of paper, we signed a moral contract, right, that we have to, we are required morally, to pay back this debt. This belief and ideology are not held by the 1%, who resign from their debts almost daily. This ideology is not applicable to major corporations that have been bailed-out in recent years.

What becomes controversial is when the 99% of working-class Americans demand the same. And that is the ideology that we’re up against. Many people believe that you took out the loan and that you are responsible for repaying it. It is true that many people have paid it back, sometimes twice. But because of skyrocketing interest, and interest capitalization, and all of the other evil mechanisms of finance capitalism, it’s literally impossible to pay back.

And so we’re acting and demanding cancellation. We like to say we are demanding cancellation or abolition. This is because we have nothing to apologize for. Because we have the audacity to go to college, for folks to try to better themselves, or to simply learn something that they’re interested in, that is not justification for a lifetime of debt.

I love the specificity and language that you use. “Forgiveness” is something that someone more powerful is generously offering you, and that’s not the frame that we’re looking at.


But I am curious how you will respond to the concern that cancellation is not sufficient without systemic reform. Or is it just like it’s a piece of bigger things you want to happen?

Yes, well, that’s why we’re calling for full student debt cancellation Free college. But the thing that makes it tough is, for us to have free college, that’s going to require legislation. Unfortunately, Congress is having trouble getting anything done today. So until we can get to that point, whenever that is — hopefully it’s as soon as possible — what President Biden should do is cancel all student debt on his own.

So this is not going to be the catch-all solution for higher education, but it’s something he can do in the now. And what Biden could do was commit to saying, “I’m going to cancel student debt at the end of every semester as long as I’m the president of the United States, until Congress can get their act together and pass free college.”

So, absolutely, canceling student debt is going to right the wrong of this nearly $2 trillion crisis, but it’s not the long-term solution. The long-term solution is college for all, and that’s what we’re fighting for as well.

Finally, I was pleasantly surprised by the amount of respect that corporate news media showed the cancellation movement. I’m kind of surprised by it. It’s a big paradigm shift. It doesn’t necessarily look like reimagining the role of debt overall, so I’m just wary. I’m just wary of corporate media. And I wonder, what would make you want to see more of, or less of, journalism that would improve public understanding of student debt and the crisis?

This question is my favorite. I think, one, there’s too many things to name in a short amount of time. We have been trying to promote one thing, regarding dealing with corporate media. This understanding, we at Debt Collective, use MMT framing and Modern Monetary Theory. It is important to understand that the federal government does NOT operate like a household’s budget. They have the means to do what is necessary if it’s improving people’s lives. We see this with endless wars, where money is always available to fight wars.

And so one thing in particular with the student debt crisis that we’ve been struggling to get media, and thereby their readers, to understand is that cancellation is not going to weigh deeply on taxpayers (which, student debtors are taxpayers). In fact, student debt cancellation will actually boost the economy. It’s actually going to create millions of jobs over the next decade. The reason is that student loans are money already out of reach. And so there’s often this conflation that $1.8 trillion in student debt means $1.8 trillion that’s going to come out of the pockets of people, and that’s actually not how debt cancellation works. The Debt Collective has actually bought and erased debt through the secondary market and we know that debt is worth pennies per dollar.

So one thing that we’ve tried to push through is this idea that canceling student debt is going to then hurt the economy. Student debt is the real problem. It will not help the economy. Whether you have student debt or not, you’ll benefit from the housing market booming, people being able to afford rent, putting food on the table, taking care of their children, etc.

I’d like to thank you very much for that. We’ve been speaking with Braxton Brewington; he’s organizer and press secretary at Debt Collective. You can follow their work at Braxton Brewington, thank You so Much for Joining Us This Week CounterSpin.

Thank you so much.