Care about the Lives of Black Students? Then It’s Time to Fix the Black Student Debt Crisis!
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Care about the Lives of Black Students? Then It’s Time to Fix the Black Student Debt Crisis!

For Black borrowers, student loan debt had reached a crisis level before COVID-19. The same racist structures that make Black people more likely to die from COVID-19 or experience financial hardship from the pandemic are the same structures that c

By Tiffany Jones, Victoria Jackson, and Jaime Ramirez-Mendoza

July 9, 2020

Editor’s Note:An article by these authors,Borrowing while Black: Understanding What Makes Student Debt a Crisis for Black Students,” was recently featured in AAC&U’s special issue of Liberal Education on “Democracy in Action.”

2020 has been a year of transformation. People are rising up and demanding public policy that advances racial and social justice. There are social uprisings and protests in the streets in response to police killings of unarmed Black people, systemic racism, and social inequality. The COVID-19 pandemic has caused a global health and economic crisis that affects everyone, but the consequences are more severe for groups like Black Americans, the elderly, and those without the financial means to refuse work in order to shelter safely at home.

Black Americans are disproportionately dying of coronavirus. That’s devastating, but not surprising news. COVID-19 does not discriminate, but people and systems do. If you’re Black in America, you’re less likely to have health insurance and more likely to have conditions like diabetes and hypertension, which increase the risk of contracting and dying from COVID-19. If you’re Black, you’re also more likely to have a low-paying job that requires social contact, and you’re less likely to be able to work from home or have savings that would allow you to stock up on basic supplies and withstand the financial strain of unemployment.

Over 40 million Americans filed for unemployment by mid-2020. In April, the unemployment rate for Black Americans was 16.7 percent compared with 14.2 percent for White Americans. To ease some of the financial strain brought on by COVID-19, policymakers paused federal student loan payments and interest, collections on defaulted federal loans, and wage garnishments for student loans for six months. Unfortunately, the design and implementation of the law have left many borrowers still struggling. For Black borrowers, student loan debt had reached a crisis level before COVID-19. The same racist structures that make Black people more likely to die from COVID-19 or experience financial hardship from the pandemic are the same structures that created the Black student debt crisis.

When analyzing the $1.6 trillion in student loan debt, it becomes evident that borrowing while Black is a different experience. Black students are more likely to borrow, borrow more, owe more than their original amount, struggle with repayment, and stillhave higher default rates among those who earn a college degree and come from high-income families.

Unfortunately, tackling unaffordability and funding inequities is not new for Black students. In the public K–12 system, non-White school districts received $23 billion less than White school districts, and Black students are concentrated at under-resourced schools that are less likely to have college-prep courses and teachers who believe in them. In the aftermath of the 2008 recession, states slashed their higher education funding and institutions increased tuition to make up the difference, which resulted in putting the burden of cost on students. Even before that, states have historically underfunded less selective public institutions and historically Black colleges and universities (HBCUs) that disproportionately enroll Black students, leading to less access to critical resources and aid necessary for students to complete their degree. This severely affected students in Black households, who—due to racist policies—have less income and wealth and face a discriminatory job market that inequitably strips them of financial opportunities. Meanwhile, the federal government has failed to step up. The federal need-based Pell Grant is awarded to nearly 60 percent of Black students, but even the maximum award amount only covers 28 percent of college costs at public universities. In addition, the federal government has failed to protect students from predatory for-profit institutions that disproportionately target and enroll Black students.

While policy makers and public officials have doled out statements and provided some relief, millions are demanding policy that makes more systemic change. As recently as last year, the idea of canceling student debt was seen as a radical proposal championed mostly by grassroots movements and progressive policy makers with presidential aspirations. Amid COVID-19, however, more moderate groups and even elected officials from the middle of the political spectrum are proposing to cancel at least some student debt for the sake of the country’s economic survival and recovery. Black student debt was a crisis before COVID-19, so solutions require a permanent fix that includes at least some debt cancellation and investments in financial aid so Black students don’t have to mortgage their futures to pay for college.

The pandemic did not create this crisis, but it is highlighting the economic fragility that the current generation is experiencing, in part from the burden of student debt. It took just weeks for over 40 million people to file for unemployment, but it will take far longer for them to regain some modicum of economic stability, especially if a higher education remains out of reach and debt continues to stifle progress. That is why any policy response to the COVID-19 crisis should help student borrowers, especially Black borrowers facing multiple crises created by systemic racism, COVID-19, and student debt.

Learn more about the Black student debt crisis and what to do about it here.​

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  • Tiffany Jones

    Tiffany Jones is senior director of higher education policy with The Education Trust.

  • Victoria Jackson

    Victoria Jackson is senior higher education policy analyst with The Education Trust.

  • Jaime Ramirez-Mendoza

    Jaime Ramirez-Mendoza is higher education policy analyst with The Education Trust.