For nonwhite Americans, canceling student debt is racial justice

TAYLOR JUNG | MAY 5, 2022

NJ Spotlight News

For New Jersey school psychologist Norma Reyes, not having to make her student loan payments the last two years has been a “blessing.” While the Biden administration pushed back payments to the end of August and is expected to make a student loan announcement in the coming weeks, the looming and unclear future of her debt is unsettling.

“However, those loans are still there. And it’s very scary for me to know that they’re still there, and to know, OK, what is going to happen when (payments start) over again? So even though it’s been a nice little honeymoon, at the same time I am very afraid of what’s going to happen when I start paying,” said Reyes.

Reyes said the last time she was quoted on a federal loan payment, she was told her payments would be $2,000 per month. When Reyes graduated from Fairleigh Dickinson University with a bachelor’s and master’s degree in 2013, she owed over $100,000 in federal and private student loans, most of which came from graduate school. She owes more now than she did then because of interest, and her debt caused her to put off buying a house and having a family, Reyes said.

“The biggest thing (loans) have impacted me in is my emotional well-being … because I have anxiety over this. I think about my future. I think about, am I going to be able to have children,  afford children?” she said. “Am I going to be able to help my children go to college?”

Reyes isn’t alone. Both private and public colleges are more expensive now than they have ever been. From 2018 to 2019, 64% of New Jersey college graduates had student loans, with a total of 1.36 million residents sharing $47.8 billion in debt. In New Jersey and across the country Black and brown student take out loans at higher rates than their white counterparts. Black college graduates, for example, owe $25,000 more in student loans than white college graduates, according to the Education Data Initiative.

What will Biden do?

It’s been reported that President Biden is not considering canceling all student loan debt and instead is looking to cut a portion for certain borrowers. Economic experts and social justice advocates say that canceling all debt would financially lift Black and brown communities, and that it’s impossible to talk about canceling debt without considering the disproportionate impact these loans have on nonwhite people.

“The student loan debt crisis has impacted people of color and women in a disproportionate fashion. The fact that families of color don’t have the historic wealth or necessarily the historic educational background in their families means they are often starting out with less money to bring to table,” said Beverly Brown Ruggia, financial justice program director for New Jersey Citizen Action, a social justice nonprofit.

“For many students of color, they are the first generation in their families to seek higher education. Because of the racial wealth gap in this country, we also know that many of the (Black, Indigenous and people of color) students that are going to college today don’t have the same resources that their white counterparts would have in paying for college,” she added.

Brown Ruggia said that student loan debt deepens the racial wealth gap in the United States, doing “the opposite of what higher education is supposed to do.”

Higher education’s goal “is to lift (Americans) up into financial security through good jobs, through good careers, and potentially the kinds of incomes that will provide them and their families with financial security and move them into middle-class wealth,” she said.

Talking about systemic racism

Peter Chen, a senior policy analyst for New Jersey Policy Perspective, a progressive think tank, said it’s “impossible to talk about wealth disparities without talking about systemic racism.”

“Black families were kept out of home-owning programs for long periods of time, segregated from neighborhoods and towns, [making] it nearly impossible to build wealth through real estate,” Chen said. “…then college education itself was segregated and restricted at a time when higher education was relatively low cost … and it’s become higher-cost in recent years, at a time when the nation and its student body population is growing more diverse.”

Chen said the majority of student loan debt is now graduate debt, like Reyes’s. He added that advanced degrees are required for access to more jobs in “wealth-building” fields — which, in a way, financially punishes Black and brown families trying to pull themselves up, and “creates a drag” on the economy.

“And so as more graduate debt is taken on, it puts an anchor around the neck of Black and Hispanic students that are coming from backgrounds that generally have less wealth to begin with. And basically, at every step you want to take closer to wealth accumulation and higher income, you have to then take this extra millstone with you to get to your goal.”

As a woman of color from an immigrant family, Reyes said she had to navigate the college process alone; applying to schools and getting financial aid weren’t things her parents were familiar with.

“My parents are immigrants. So my parents came to this country for the only purpose of giving me a better life. And I feel like what they thought was the American dream was very different than what I’ve actually experienced,” she said. “…But I feel like they were very, very, not educated enough to guide me correctly. Still to this day, they don’t understand the whole college process. So most of the time, us immigrants, we navigate it ourselves.”

Level the playing field

For college admissions expert Yaritza Gonzalez, canceling student debt is a way to “even out the playing field” and help families of color financially catch up to their white counterparts.

“Canceling student loan debt is really a place for our Black and Latino families to … be able to start at zero. It’s a luxury, at this point, to start at zero, because so many of our families are starting at negative-six figures in a lot of cases because they wanted to pursue an education.”

Gonzalez is the founder of College Money Chica and guides Black and brown New Jersey families through the scholarship process to help them reduce the amount of loans they take on.

“A lot of my clients come from families where … they’re the first in their family to go to college, and so there’s no one in their family with the experience of what it is to apply, what it is to pay for college. And so they really need additional help to understand this very complicated process,” Gonzalez said.

More education for high schoolers about their options — between grants, scholarships and loans — is one way Gonzalez hopes to close the wealth and knowledge gaps. Brown Ruggia and Chen said that investing in public education is one way to help reduce the loan debt that students of color must take on, because disinvestment in public colleges is part of the issue.

“(New Jersey Citizen Action has) worked in the state to make college more affordable in the first place,” said Brown Ruggia. “The governor has worked with the Legislature to create what they call the CCOG, the Community College Opportunity Grant, and that means that potential students in the state can go to community college for free if their families earn less than $65,000 a year.”

It’s not yet clear how Biden plans to tackle the student loan debt crisis — whether with more investments in public education, forgiving $10,000 or $50,000 of student loans and/or placing an income cap on who qualifies for debt forgiveness.

“I just wish that, whether it’s the senators, governors … the president — whoever is going to make this decision, to really consider that all we tried to do was get a better education for ourselves,” said Reyes. “It shouldn’t be a life sentence, because that’s all we tried to do. Especially us immigrants that came to this country for a better future. This is not really what we signed up for.”

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published this page in News and Politics 2022-05-05 03:08:15 -0700