The Education Trust Calls the Supreme Court’s Student Debt Relief Ruling a Setback to Economic and Racial Justice
Contact: Ameshia Cross
across@edtrust.org
312-339-6930
The Education Trust Calls the Supreme Court’s Student Debt Relief Ruling a Setback to Economic and Racial Justice
WASHINGTON — Today, the Supreme Court ignored the plight of more than 40 million student loan borrowers with a ruling that not only strikes down President Biden’s debt relief plan but turns a blind eye to the crushing effect these loans have on families and our country’s economic growth and prosperity.
This misguided decision will hit Black borrowers particularly hard. Due to persistent systemic barriers such as the racial wealth gap, Black students are more likely than their peers to borrow, borrow more, struggle to pay on time, and default on their decades-long debt payments.
“The Supreme Court failed to help millions impacted by what some borrowers call the ‘Jim Crow’ student loan system in America,” said Denise Forte, president and CEO of The Education Trust. “Often, the result is a lifetime debt sentence for students of color and students from low-income backgrounds, who only want a chance to better their lot in life and live the American dream.”
An equity-focused ruling would have considered the role that systemic racism still plays in the nation. For example, the fact that wages for Black men and women with bachelor’s degrees are 30% and 19% lower respectively than those of White men and women with similar degrees. Lower wages coupled with higher student loan debt because of massive generational disadvantages is not a formula for financial stability or upward mobility. In fact, a 2021 Ed Trust study found that purchasing a home and saving for retirement are among the many things postponed — even by Black borrowers with higher incomes — because of their student loans.
Ed Trust has consistently called out the student debt crisis for what it is: a racial and economic justice issue that affects every American. With rising inflation and a looming recession, the U.S. Education Department has already warned of the likelihood of catastrophic default rates when payments resume in a few months. And it is predicted that restarting loan payments will suck some $5 billion out of consumer spending, reducing our nation’s economic growth and accelerating the likelihood of a recession.
Despite the Supreme Court’s decision, we will continue to advocate for other equity-centered ways to cancel federal student debt. Doing so would go far to putting the millions of students and the nation on a path to a brighter financial future.
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