Pressley savors success in student loan cut

Says cut will give significant boost to Black, Latino borrowers

Last week, President Joe Biden announced an executive order to cancel student debt up to $10,000 for millions of borrowers earning less than $125,000 annually, and up to $20,000 for recipients of need-based federal Pell Grants.

Biden also announced that the moratorium on federal loan repayment will be extended again through the end of the year.

In the wake of the announcement, Republicans have slammed the move, referring to federal aid as government “handouts,” including Massachusetts Governor Charlie Baker, who told reporters he did not think the move was “the right thing to do.” However, the Biden administration has doubled down on the decision to provide direct relief to families and individuals, and progressive lawmakers have vowed to continue fighting to reform higher education.

Massachusetts Congresswoman Ayanna Pressley, who appeared alongside Sen. Elizabeth Warren earlier in August to urge the President to cancel student debt, caught up with the Banner to share her thoughts on the move and what it will mean to constituents.

The following responses have been edited for clarity and brevity.

What do you think is the significance of the president’s action on student debt and what will it mean for the average borrower?

When I think about where we started, I think it’s important to sort of conceptualize the progress that’s been made. From where we began two years ago, when the issue of student debt cancellation was first introduced into the national discourse, there was an attempt to sort of make it a fringe issue and to marginalize, in the narrative, who was burdened by this debt. And there were some that tried to argue that student debt cancellation would be regressive in impact and would only [affect] white graduate students.

I certainly was a part of negotiations and fought and pushed for this to be more ambitious. But that still does not deny or give short shrift to the meaningful impact of this relief. Some 43 million people, I think, slept a little bit better, the night that this announcement was made, and woke up the next day feeling a little bit more hopeful, because this this debt has proven a real chokehold on people purchasing a home or starting a business. It’s burdened a whole generation. It’s actually an intergenerational crisis.

I have senior citizens in my district, 76 years old on fixed incomes, still paying on student loans, parents who took out Parent Plus loans who can’t retire because they took out loans for their kids, educators in the district who took on this debt because they wanted to teach our babies and now they’re raising a young family and they can’t afford childcare. So since this announcement was made, we’ve been hearing from people throughout the district about just how impactful this will be.

Can you talk about how this will affect Black and Latino borrowers more specifically?

While there have been some income gains in marginalized communities, Black borrowers in particular have been locked out in the past. Really, every federal relief program, from the Homestead Act to the GI Bill to the New Deal. And then because of discriminatory policies like redlining, our families’ ability to build generational wealth was really obstructed. Consequently, Black borrowers borrow at higher rates, and also default at higher rates. With the president’s plan, again, responsive to the movement that we’ve built over the last few years and holding them accountable to a commitment made on the campaign trail, 1-in-4 black borrowers will now have their debt zeroed out completely. So this does take strides in narrowing the racial wealth gap.

This proposal allows greater relief again for Pell recipients, and Pell recipients are disproportionately Black students.

(Pressley noted after the conversation that the plan would also cancel out debt completely for nearly half of Latino borrowers as well.)

Is there more that you want to push for, or that Democrats want to push for?

What I’m focused on right now is implementation. During the pandemic, one of the things that we were successful in, and again, I’ve been leading this fight in the House, is using every tool available to advance this issue, from the power of the pen, writing resolutions and legislation and corresponding with the White House, to the power of convening to talk to respective caucuses, in the House and in my delegation. We did whatever we could do to move this along.

We were successful during the pandemic in getting a pause three times on student loan payments. The final pause will go through to December 31. Now, a pause on payments actually helped us to make the case and strengthen our hand with the White House because we saw people using the money saved during that pause to remain safely housed, some people became first generation homeowners, and to purchase essential goods — all that’s important as we continue to do the work of stabilizing costs for people, while we’re still experiencing inflation.

In mid-October, as people begin to be able to go online to verify their income, and to apply for this student debt relief — and in some instances cancellation — people will begin to see the impact.

So what I’m focused on in this moment, is making sure that people are going to studentaid.gov/debtrelief to sign up so they’re notified automatically when all of this becomes available online. And then I’ll be using my authority on the Oversight Committee to ensure that the process is one that is equitable and is streamlined and without delay.

And then the other work is more systemic work to address the affordability of college. That work continues.

We need to invest in higher education as a public good and to invest in tuition-free community college. I recently secured a million-dollar investment for Bunker Hill Community College in partnership with the city of Boston for their tuition-free program. And we need to continue to invest in Pell Grants, and also to invest in historically Black colleges and universities.

I’ve also introduced legislation since I served on the Financial Services Committee, the Student Borrower Credit Improvement Act, which will help people to rehabilitate their credit for those that have been private borrowers who have had their credit impacted by these loans and entered defaults on these loans.