Student Loan Forgiveness Critics Are Wrong About Who Benefits and Why [View all]

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In late August, the Biden administration announced that it will cancel student debt: $10,000 worth of federal student loans for those earning $125,000 or less and $20,000 for Pell Grant awardees under that same restriction. The administration also announced that under a new income repayment plan it will cap repayment at 5% of one’s discretionary income and discharge any existing debt after 10 years, down from 20 years.

Democrats are using the momentum from the announcement as a way to potentially gain some political ground ahead of the midterm elections in November. Strategically, that is the right move. Giving people oxygen in an already tight space is definitely a win and will yield dividends.

But air should not be scarce in the first place. The current proposal is good, but there is still room for improvement, because America’s student debt crisis begins and ends with Black women, who — even after this announcement — still bear, on average, the highest burden. According to the American Association of University Women, or AAUW, Black women have the highest amount of student debt while having the lowest returns on their college degree.

Fifty-seven percent of Black women repaying student loans in 2016 reported that they were unable to meet essential expenses. This is not surprising. In 2020, Black women earned 63% of what white men earned, while white women earned 79%. Not to mention, research shows that the median amount of wealth for single Black women with a bachelor’s degree is only $5,000, and $500 for those with no degree. What’s more, as University of North Carolina at Chapel Hill professor and New York Times opinion columnist Tressie McMillan Cottom has pointed out, many Black college students accrue debt even if they don’t graduate. It’s a crisis of epic proportions.

https://www.teenvogue.com/story/student-loan-forgiveness-critics