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Overhauling the Public Service Loan Forgiveness Program is Good but Not Enough

Updated: Oct 9, 2021

Today, President Biden's Administration announced an overhaul of the Public Service Loan Forgiveness (PSLF) Program that it estimates will put over 550,000 public service workers "closer" to loan forgiveness. About 43 million U.S. citizens have student loan debt, so less than 2 percent of U.S. student loan debtors will be eligible for immediate relief from the PSLF changes. Since the program's inception in 2007, the federal government approved only 2 percent of PSLF applicants. The Brookings Institute estimates that at least $50,000 of student loan relief is necessary to improve the racial wealth gap, yet the PSLF forgave an average of $1,004.50 per applicant.

An overhaul of PSLF is overdue, however the plan, as announced, will not correct longstanding issues with PSLF, nor significantly improve the economic position of Black people who carry significantly more student loan debt than White Americans. Many Black people benefit from a college education, but we do not have the luxury of intergenerational wealth. Lest we forget, of the 6 living generations (The Greatest Generation, The Silent Generation, Baby Boomers, Generation X, Millennials, Generation Z) only the three youngest will start their careers at a time when employment and educational discrimination was illegal. White wealth was cemented within three generations that benefited from the worst type of handout; racial discrimination that was LEGAL before the Civil Rights Act of 1964. And those benefits are being handed down to the younger generations.

The NAACP believes the unacceptably high level of student loan debt among Black Americans is an injustice that requires thoughtful and thorough public redress. As today's announcement from President Biden's administration suggest, the PSLF needs "long-term improvements" that need to be achieved through negotiated rulemaking. The NAACP stands willing and ready to work with the administration on long-term improvements to PSLF, which means greatly expanding the scope and definition of public service, simplifying the process, and expanding eligibility criteria.

We believe overhauling PSFL is an appropriate first step. However, ultimately at least $50,000 of universal student loan cancellation is necessary to resolve longstanding racial wealth disparities exacerbated by the student debt crisis. As NAACP President Derrick Johnson explains, "canceling student loan debt is a civil rights issue that we can no longer afford to ignore."

Ivory A. Toldson, Ph.D.

NAACP, Director of Education Innovation and Research



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