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3 Things For Black America To Know About Democrat Plan To Wipe Out $50,000 Of Student Debt

3 Things For Black America To Know About Democrat Plan To Wipe Out $50,000 Of Student Debt

student loan debt
3 Things For Black America To Know About Democrat Plan To Wipe Out $50,000 Of Student Debt. Photo by cottonbro from Pexels

The Democrats have been pushing for a student loan debt plan since the 2020 presidential campaign. Now that Joe Biden has been elected, the Dems are expecting the president to move on a plan that could erase $50,000 of student debt for all borrowers and cancel all of the debt for 80 percent of federal student loan borrowers.

Black people would be among the biggest winners, politicians say.

“During a time of historic and overlapping crises, which are disproportionately impacting communities of color, we must do everything in our power to deliver real relief to the American people, lift up our struggling economy and close the racial wealth gap,” Senate Majority Leader Chuck Schumer (D-NY) said in a statement.

Here are three things Black America should know about the plan.

Black grads owe $25K more in student loan debt than white

Schumer, Sen. Elizabeth Warren (D-MA), Rep. Ayanna Pressley (D-MA), and Rep. Ilhan Omar (D-MN) recently reintroduced a resolution in Congress calling on Biden to use executive action to cancel $50,000 in federal student loan debt for every borrower.

This would seem to be a plus for Black college graduates, who owe an average of $25,000 more in student loan debt than white ones, according to Education Data. Four years after graduation, 48 percent of Black students owe an average of 12.5 percent more than they borrowed.

“(Student loan debt) is a huge anchor on our entire economy,” said Sen. Schumer, arguing that there are few more powerful economic tools “than canceling $50,000 in student debt. It would be a huge push for our economy.”

Student-debt cancellation and its Occupy Wall Street origin 

The idea of student-debt cancellation has its origins in Occupy Wall Street protest movement, Market Watch reported.

The movement was launched in Zuccotti Park, located in New York City’s Wall Street financial district in September 2011 against economic inequality.

Black people did not relate to the Occupy Wall Street rhetoric. “Comparing debt to slavery, believing police won’t hurt you or wanting to take back the America you see as rightfully yours are things that suggest (Occupy Wall Street) is actually appealing to an imagined white (re)public. Rather than trying to figure out how to diversify the Occupy Wall Street movement, white progressives need to think long and hard about their use of frameworks and rhetoric that situate Blacks at the margins of the movement,” wrote author and activist Kenyon Farrow in the American Prospect.

While cancellation will have a positive impact on Black students who carry a disproportionate amount of debt, Black people were initially hesitant to embrace Occupy Wall Street.

Listen to GHOGH with Jamarlin Martin | Episode 73: Jamarlin Martin Jamarlin makes the case for why this is a multi-factor rebellion vs. just protests about George Floyd. He discusses the Democratic Party’s sneaky relationship with the police in cities and states under Dem control, and why Joe Biden is a cop and the Steve Jobs of mass incarceration.

Defaults are 3x higher among Black grads

Erasing student loan debt would reduce defaults. Currently, around 38 percent of Black students who entered college in 2004 had defaulted within 12 years — a rate three times higher than their white counterparts, CNBC reported.

Nearly 85 percent of Black bachelor’s degree holders retain student debt, compared with 69 percent of white bachelor’s degree recipients, according to the Center for Responsible Lending.

Wiping out the loans held by Black students would make the biggest strides toward closing the racial wealth gap since the Civil Rights movement, according to an aide to Sen. Warren.