Democratic U.S. Senator Elizabeth Warren will be in Western Massachusetts Tuesday with Congresswoman Ayanna Pressley to talk student loan debt cancellation. The two are touring the state with additional stops in Boston, Brockton, Worcester, and Springfield to encourage those eligible for President Joe Biden’s forgiveness program to sign up.
Announced in August, the plan forgives $10,000 in student loan debt for individuals – and an additional $10,000 for Pell Grant recipients. The U.S. Department of Education estimates the program will cost the government $30 billion a year for the next decade. Americans currently collectively owe around $1.75 trillion in student loan debt. While a lawsuit from six Republican controlled states has held up the plan in federal appeals court, the Biden administration says it still intends to carry out the cancellation. Warren spoke with WAMC about why she’s making the trip to Springfield Technical Community College Tuesday afternoon.
WARREN: This is really exciting. You know that President Biden has cancelled student loan debt for about 43 million Americans. And that's roughly around 850,000 in the Commonwealth of Massachusetts, who are going to have some or all of their debt canceled. So, Congresswoman Pressley and I are coming out Tuesday to Springfield Technical Community College. We're going to be there at 4:45 in the afternoon just to rally people to make sure that everybody who's eligible gets signed up so that they get their debt canceled, and to encourage people to come and kind of get the word out. You know, tell your sister, tell your mom, tell your cousin, tell your neighbor, because I want to make sure that everybody in the commonwealth who’s eligible for this release actually gets it.
WAMC: So what's at stake here? What are people missing out on if they don't take advantage of this program?
Well, if anyone was a Pell recipient back when they were in two-year college, four-year college, technical school, they are entitled to have up to $20,000 worth of student loan debt just cancelled, gone, wiped off the books. If they weren't Pell eligible, then they're entitled to have about $10,000 canceled, off the books. Now, this only applies to people whose income is less than $125,000. And I'm just going to be blunt here- Most of the people who have this debt and who are going to get relief have family incomes under about $75,000. But it's an easy, easy form, to go online, to check it out. It's under studentaid.gov, and it's a really easy form and you can tell right away if you're entitled to cancellation. Fill out the form, it takes a couple of minutes. And here's the best part- Cancelation is going to happen in just a matter of weeks, and that means- I want you to think about it from a personal point of view. It means people who've been under this weight, it means people who haven't been able to think about moving out of mom's basement, or buy a car, haven't been able to think about buying a home, for some, haven't been able to start a small business, or haven't been able to start a family, that they can get rid of this debt and really build a more secure economic future.
Let's talk brass tacks. When you talk about the impact of student loan debt on American society, on the commonwealth, what are some of the big pertinent numbers here? What does this mean materially for people in Massachusetts?
Well, mostly what it means for folks in Massachusetts is, for the 850,000 who are going to be eligible for debt cancellation here, is that they can just kind of steady themselves financially. Now, as you know, there haven't been any student loan payments up to now for gosh, it's been two and a half years during the pandemic. But those payments are about to start in January. And on average, they're around $400 a month. So being able to wipe out or reduce your student loan debt is going to have a big month-to-month impact for folks going forward. And that's going to be a really big deal.
Now, this legislation is just the beginning of an effort to address a problem that will certainly continue well after this, the impact of this is felt. And certainly, you've had your own larger ambitions for greater versions of this same program. What comes next from the Democrats to build on this and to continue chipping away at student loan debt in America?
Great question. So let me give you part two, because we're also going to be doing this Tuesday, and that is the Public Service Loan Forgiveness Program. So, you may remember for anybody- Think about who's in public service. Public schoolteachers, firefighters, police officers, people who work for the city or the county or for the state or federal government, nurses that are working in nonprofit hospitals. All of them under existing law, were entitled to sign up for public service loan forgiveness. And after 10 years of making payments, they get the whatever debt remained wiped out. Well, it turned out that the loan servicers were really bad on this, and they put people in the wrong programs, they shuffled them off to the wrong places that gave them bad information. And so lots of people who could have gotten help didn’t get help. Between now and October 31st, between now and Halloween, people are entitled, who are in public service, to get what's called a waiver to enter the new Public Service Loan Forgiveness Program and have all of their past payments count toward their 10 years, and when they hit that 10-year mark, wipe out the remaining debt. So that's going to help a lot of our teachers and firefighters and nurses. That's the next step. But we've got more beyond that! You want to hear about it?
I sure would.
Okay, from there, we've got to keep chipping, obviously, at student loan debt. But we also need to look much, much harder at how to prevent the buildup of this debt again in the future. And that means we've got to make college more affordable. And to do that, it's going to take a combination of both our state government and our federal government to put in enough support to our public colleges and universities so that nobody has to take on a crushing debt burden in order to get a technical certificate, or in order to get a two-year degree, or in order to get a four-year degree. For me, this is about how we think about building a future, and we build a future by making investments and roads and bridges. We build a future by making investments in broadband. We build a future by making investments in educating our people, and to help people get ready for a 21st century economy. As a nation, I believe we need to be making those investments so that everybody who wants to get that education can get it without getting crushed by student loan debt. That's what still lies in the future, and that in part is what's on the ballot come November. So, this is what the Democrats are fighting for, and that's why I fight right alongside them
I wanted to get your thoughts on the Fifth Circuit Court of Appeals ruling on the Consumer Financial Protection Bureau about the funding structure’s unconstitutionality. What are your thoughts on this? I know you've hit back before, but I want to sort of cut to the bone here- What's going on with the Bureau?
Well, first, they're just wrong on the law. And second, this is really reckless. So let's do the first one. The Consumer Financial Protection Bureau is funded in the same way that the Federal Reserve is, which, by the way, is not the only banking regulator that is not funded through appropriations. The Office of the Comptroller of the Currency, which is the main bank supervisory board, and the FDIC, you know, that does that great insurance to make sure that the money will be there, you know, if you've got money in a checking account, all of them are funded outside appropriations. And that means the Senate doesn't vote or the Congress doesn't vote on them every year, and that has been the case since 1863, since the first federal banking regulator was put in place. And you know, the reason was pretty obvious. And that was that, we as, basically, as a nation said, not a good idea to have politicians have the financial control over these bank regulatory agencies, because they'll be subject to too much political pressure. So that's how it's been set up all along. There's nothing unusual about the CFPB. But that's part of what makes this decision so reckless. When the Fifth Circuit says, nope, I'm just, they are just declaring the entire agency unconstitutional, they're in effect, I think, trying to say that all of the regulations the agency has put out to protect people on home mortgages and credit cards and payday loans- Are they saying that that just disappears? And are they saying that, at least in the Fifth Circuit, they don't recognize the Federal Reserve Bank? They don't recognize the bank supervisors of the Office of the Comptroller of the Currency? They don't recognize FDIC insurance? This is just one of those opinions for which you’re just left to shake your head about how these guys are playing politics instead of actually doing their job and that is enforcing the law as it's written.
