2016 MILLENNIAL MEMO (April 27, 2016)
Programming Note: I’m doing “field research” on the world’s perception of the U.S.’s elections over the next few weeks. Don’t worry, I’ll return in mid-May with a wrap-up of everything you missed while I am out. In the meantime, make sure to encourage your friends and colleagues to sign up for updates here and follow us on Twitter here.
CRUZ REPRESENTED STUDENT LOAN LENDER AGAINST BANKRUPT BORROWER: “Cruz hasn’t offered a plan to cut the cost of college and, in the Senate, opposed letting millions of Americans reduce their student loan payments. While working previously as a private lawyer in Houston, Cruz helped represent a lender who went to the Supreme Court to keep an Arizona man from avoiding interest payments on his student loans by filing for bankruptcy…. There, Cruz opposed Francisco Espinosa, an airline baggage handler who incurred more than $13,000 in debts to attend technical school in Arizona but then filed for bankruptcy – proposing to pay back the principal of his loan over time but not roughly $4,000 in interest. Cruz helped represent Espinosa’s lender and objected to bankruptcy protection because the original judge had not included a finding that paying back the loans with interest was an ‘undue hardship.’ A brief co-signed by Cruz argued that excusing interest payments could ‘open the floodgates’ and let others duck debts including ‘taxes, domestic support obligations, drunk driving personal injury and death liabilities and criminal fines and restitution.’ The case reached the Supreme Court, which ruled 9-0 against Cruz’s side.” (Associated Press, 4/23/2016)
BROOKINGS ANALYSIS FINDS HIGHER-INCOME STUDENTS WOULD BENEFIT 24 PERCENT MORE (IN DOLLAR VALUE) FROM SANDERS’ TUITION-“FREE COLLEGE”: A new analysis looking at who benefits from eliminating tuition and public colleges and universities finds that “families from the top half of the income distribution would receive 24 percent more in dollar value from eliminating tuition than students from the lower half of the income distribution. The non-tuition costs of attending college, including living expenses, are larger than the costs of tuition and fees for most students. Free college, which does not address these expenses, leaves families from the bottom half of the income distribution with nearly $18 billion in annual out-of-pocket college costs that would not be covered by existing federal, state, and institutional grant programs. Devoting new spending to eliminating tuition for all students involves a tradeoff with investing the same funds in targeted grant aid that would cover more of the total costs of attendance for students from less well-off families.” (Brookings, 4/21/2016)
AG’S REQUEST FOR SUMMARY JUDGEMENT IN NY LAWSUIT AGAINST TRUMP U IS DENIED, PUSHES THE STATE’S CASE TO FALL 2017: “A state judge said she won’t grant summary judgment to New York State Attorney General Eric Schneiderman’s office as it pursues its fraud case against Donald Trump. Schneiderman subsequently issued a statement suggesting that his office would call on Trump to testify at a trial. ‘I’m not granting summary determination,’ Judge Cynthia Kern said Tuesday. ‘There’s nothing more for me to decide on that issue.’ Jane Azia, Schneiderman’s consumer fraud chief, said in court that there was ‘extensive evidence in the record already to demonstrate respondent engaged in fraud’ and, there being ‘no issues of fact,’ Kern should grant summary judgment… Trump’s lawyer, Jeffrey Goldman, approved Kern’s ruling, and said he wanted a jury trial… [He] said his ‘best guess’ for a trial date would be ‘in the fall,’ meaning fall 2017.” (Capital New York, 4/26/2016)
MAY HEARING SCHEDULED IN CA WAPO-TRUMP UNIVERSITY DOCS LAWSUIT: “The Washington Post’s bid to unseal documents filed in a class-action case against Trump University will get a hearing in May. Earlier this month the newspaper asked a San Diego District Court to unseal hundreds of pages of documents in the case against GOP presidential front-runner Donald Trump. The Post argued the lawsuit filed by former Trump University students has become a campaign issue and the documents should thus be available to the public. …‘Plaintiff’s allegations in this case, and the lawsuit itself, have become prominent campaign issues,’ which makes the need for transparency in the case paramount. The hearing on the Post’s request is scheduled for May 27.” (Politico, 4/20/2016)
STEYER INVESTING $25 MILLION IN REGISTERING MILLENNIAL VOTERS: “California billionaire and climate change activist Tom Steyer is launching a $25-million effort to register young voters. Steyer’s group, NextGen Climate Action, announced Monday that it plans to deploy organizers to hundreds of college campuses in seven states ahead of the November election… The new registration drive will target college students in Ohio, Nevada, Colorado, Illinois, Iowa and New Hampshire, several of which are swing states in presidential elections.” (Los Angeles Times, 4/25/2016)
HARVARD IOP POLL OUT THIS WEEK; VOX HAS YOU COVERED WITH ALL THE CHARTS: Check them out here. Looks like Mr. Trump has some serious work to do with the generation.
PA CONGRESSMAN BRENDAN BOYLE CITES CLINTON’S STUDENT DEBT PLAN IN MAKING ENDORSEMENT, SAYS SANDERS ONLY FOCUSES ON INTEREST RATES: Pennsylvania Congressman Brendan Boyle writes: “But the sheer scale of [our student debt] problem means that this work is only just beginning… And it’s why I’m so excited to announce my support for Hillary Clinton. In my view, Hillary has the most comprehensive and effective plan for tackling the burgeoning student debt… Her plan addresses the shockingly high interest rates… Just as it’s possible to refinance a home mortgage, Hillary believes people ought to be able to do the same with their student debt. Congress is debating a bill that would do just that, and the Senate is only two votes shy of passing this law. The 2016 election could be the last push that’s needed to make this solution a reality. Now, Senator Bernie Sanders’ plan also addresses this issue – but that’s where his ideas end. In contrast, it’s where Hillary’s plan is just beginning. She’s not only focused on solving this problem for kids who are born today, but on the crushing burdens that are currently weighing down millions of Americans. Too many Americans remain unaware of President Obama’s initiative to limit student debt to 10 percent of your income. Hillary’s plan will ensure that every borrower knows about and can participate in such a program and that there are no barriers to signing up. She will also crack down on predatory bill collectors, who too often harass Americans just as they’re trying to get on their feet. Her plan would require that loan servicers offer more flexibility and repayment options… Hillary’s plan will also expand debt relief for anyone who participates in national service… And she would also help entrepreneurs who are starting small businesses defer their payments, and pay zero percent interest for up to three years.” (The Hill, 4/26/2016)
COLORADO–BENNET TV AD FOCUSES ON COLLEGE AFFORDABILITY & STUDENT DEBT: “U.S. Sen. Michael Bennett released a new ad that hit TV stations in Denver and Colorado Springs [last week] touting his work on college affordability. … ‘I’m fighting for a law that would allow people to refinance their student loans just like you can a car loan or a home loan,’ Bennet says in the ad, after adults wearing their graduation caps talk about Colorado’s collective $21 billion in student loan debt. ‘Every Coloradan deserves a chance to go to college, and every graduate should have more to look forward to than a lifetime of debt.’” (The Gazette, 4/20/2016)
FLORIDA–MURPHY SPONSORS BILL TO STOP SOCIAL SECURITY GARNISHMENT TO PAY OFF STUDENT DEBT: “U.S. Rep. Patrick Murphy introduced a bill last week that would prevent Social Security benefits from being garnished to pay student loans. The Jupiter Democrat seeking the nomination for an open Senate seat said it’s intended to ‘bolster our middle class.’ In the fiscal year that ended in October, 860,000 individuals had their Social Security benefits reduced to pay for federal debts, with the federal government collecting $382 million, according to the Senate Finance Committee. But that accounting included attempts to collect other debts besides student loans. A 2014 General Accountability Office report found the number of people whose Social Security benefits were reduced specifically to pay off student loan debt rose from 31,000 in 2002 to 155,000 in 2013… The numbers for those older than age 65 rose from 6,000 to 36,000 in the same period. Some of those were paying down debts incurred to educate their children through co-signing or Parent PLUS loans. People older than 65 owe $18.2 billion on student loans, according to former Harvard professor and lawyer Nancy J. Altman, founding co-director of Social Security Works, an advocacy group.” (Vero Beach Press Journal, 4/24/2016)
FLORIDA–JOLLY ENDORSES REFI, NEW BANKRUPTCY PROTECTIONS FOR STUDENT LOAN BORROWERS, AND OPEN TO EXPANDING PELL GRANTS: When asked about college affordability and student debt at this week’s first–of-its-kind “Open Debate,” Republican Congressman David Jolly “There are some simple things we can do right now by allowing student loans to be refinanced, by making them eligible for reorganization in bankruptcy cases — those are two initiatives I have supported in the past. Creating additional flexibility for accelerating Pell grant, need-based aid, [and] considering, if we can find a way to pay for it, expanding Pell grants… I think we should go back to the system where the universities are renumerated by the success of the… loan.”
MISSOURI–STUDENTS & ADMINISTRATORS TALK PROBLEMS WITH FEDERAL WORK STUDY & BARRIERS TO COLLEGE COMPLETION WITH KANDER: “Gena Boling, associate director of MU’s Office Financial Aid,… identified another weakness: the federal work-study program. She said MU receives $1.5 million annually to pay about 1,000 students participating in work-study programs. She said this allocation has not changed since it was determined by the Higher Education Act… She estimated about 90 percent of students working on campus are funded by the university, not the federal government. Amy Wasowicz, a sophomore at MU, said she was asked to find another job after she hit the $1,500 cap on her federally subsidized work-study position. Wasowicz was also concerned with the impact of the cost of student housing on student debt. She said she struggled to find affordable housing near bus stops and within walking distance from her classes. Kander said it was clear that college needed to be more affordable. He offered a couple of solutions: ensuring that students could refinance educational loans and capping interest rates on federal student loans. Kander, a Democrat, is challenging Republican incumbent Roy Blunt for U.S. Senate.” (Columbia Missourian, 4/25/2016)
NORTH CAROLINA–ROSS SAYS STUDENT DEBT THREATENS “THE BACKBONE OF OUR ECONOMY”: “The average student loan debt in North Carolina is a little more than $25,000, Ross said in an interview at the Citizen-Times during a campaign trip to several Western North Carolina counties. Rules governing the loans are unfair to students and the debt means students can’t contribute as much to the economy as they would otherwise, Ross said. ‘When people graduate with $25,000 of debt, they can’t start a small business. I have people on my staff who are saying they want to wait to have a family until they pay off their student debt,’ she said. ‘These are things that are the backbone of our economy.’ Burr has touted his support for legislation to simplify student loan programs in the past, although Ross said she feels he has not done enough. Interest rates will naturally be higher for student loans than for some other kinds of debt because they are unsecured, Ross said, but rates are still too high and the federal government can help lower them, she said. And, some student loans cannot be refinanced to allow graduates to lower their rates, she said. ‘When students get jobs and when we know they get that income stream, they should be able to refinance their student loans … just like you can refinance your house,’ Ross said. College costs have risen partly because of inflation and partly because of inadequate funding by the state General Assembly, she said. That and the fact that more people see the value of a college education to their future means many students rely on loans to finance their education, Ross said. ‘We have more and more people at different income levels who are seeking that higher education to have the American dream,’ she said.” (Asheville Citizen-Times, 4/23/2016)
NORTH CAROLINA–ELON POLL FINDS MAJOR SUPPORT FOR INCREASING AID TO LOW-INCOME STUDENTS, EVEN IF THAT MEANS INCREASES IN PERSONAL TAX LIABILITY: A new Elon University “live-caller, dual frame (landline and cell phone) survey of 692 residents of North Carolina was conducted from April 10-15, 2016” tested public opinion for increasing aid to low-income students versus tax increases. Here are the results: “The state should provide aid to low-income college students, even if I have to pay more taxes. Strongly Agree: 12 percent; Agree: 47 percent; Disagree: 30 percent; Strongly Disagree: 6 percent; Don’t Know/Unsure: 6 percent.” (The Stanly News & Press, 4/24/2016)
PENNSYLVANIA–IN LTE, KUTZTOWN PROF PRAISES SESTAK ON STUDENT DEBT: “We can continue to point fingers or we can fix the [college affordability and student debt] problem[s] at [their] source… We could change the interest on student loans using 30-year as well as 10-year notes to achieve a 30 percent reduction in rates, as Senate candidate Joe Sestak has suggested. We could bring back summertime Pell Grants so students can reduce their loan burden and graduate sooner. We might reconsider giving 31 percent of federal student loans to for-profit colleges that serve 13 percent of students, especially when half of all student loan defaults come from these colleges. Sen. Pat Toomey voted on numerous occasions against making college more affordable. Only Sestak has proposed real solutions to our student loan crisis.” (Lehigh Valley Live, 4/21/2016)