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Racial Divides Found in Student Loan Defaults by Charlene Crowell

July 2, 2018

 

Racial Divides Found in Student Loan Defaults

By Charlene Crowell

charlene-crowell

 

(TriceEdneyWire.com) - With 44 million consumers owing student debt that now reaches $1.5 trillion and still climbing, a lot of people want to better understand how and why this unsustainable debt trajectory can be better managed. For Black consumers who typically have less family wealth than other races and ethnicities, borrowing is more frequent, and as a result, often leads to five figure debts for undergraduate programs and well beyond $100,000 for graduate or professional degrees.

 

Besides deep debt incurred to gain a college education, another sphere of concern presents yet another financial hurdle: student loan defaults.

 

New research by Judith Scott-Clayton of the Brookings Institution focuses on explaining these defaults and what happens once they occur. Her research shows that a large racial gap exists in default rates between Black student loan borrowers and their White counterparts. This gap can only be partially explained by controlling for multiple socio-economic and educational attainment factors.

 

After accounting for variations in family wealth and income, differences in degree attainment, college grade point average and even post-college income and employment, a stubborn and statistically significant 11 percentage point gap remains between Black and White student loan borrowers.  Before adjusting for these factors, the gap is 28 percent, with Black borrowers defaulting at a rate of more than double that of Whites -- 49 percent compared to 21 percent over 12 years.

 

The research also finds a strong disadvantage to attending for-profit colleges, in which Black students disproportionately enroll.  More than a decade after leaving school, and accounting for the same background and attainment factors listed above, loan defaults of for-profit college borrowers exceed those of two--year public sector peers by 11 percent.

 

The author points to the need to understand what influences the “stark” remaining divide.

“The better we can understand what drives these patterns,” wrote Scott-Clayton, “the better policymakers can target their efforts to improve student loan outcomes.”

 

Among these influences are the widening racial wealth gap. As Black student debt is typical heavier and often takes longer to repay, the ability to build wealth becomes a heightened challenge. Years that might have been opportunities to become homeowners or begin other investments can have lengthy deferrals due to large student loan debts.

 

Similarly, a new report by the Consumer Financial Protection Bureau (CFPB) that focused largely on student loan repayment reached a similar conclusion. Authored by Thomas Conkling, the new CFPB research examining borrowers who were unable to fully repay their student loans early, “suggests that their required monthly student loan payments constrained their ability to pay down other debts.” CFPB also found that the typical student loan repayment lasts a full decade with equal monthly payments. Further, borrowers repaying on schedule are not more likely to become first-time homeowners.

 

A portion of the Brookings report provides useful information that could help those at risk or in default. Loan “default is a status, not a permanent characteristic.”  Four ways to get out of default are cited: rehabilitation, consolidation, paying in full, or have a loan discharged.

 

For my money, paying in full is seldom a practical option unless someone’s lottery numbers hit a jackpot. But the other three options offered could begin to chart a path in important ways.

 

Rehabilitation of student loan defaults can only be used one time. It also requires, according to Brookings, successfully making 9 payments over 10 months.

 

A second option, consolidating defaulted loans, can end default more quickly and is used by more than half of Blacks who have defaulted.

 

In recent years, loan discharge has been frequently pursued, especially by former students of now-defunct for-profit institutions. Others choosing public service careers may be eligible for loan forgiveness depending upon the type of loan, servicer assistance and employment.

 

Any loan default will worsen credit scores and will be a part of a consumer’s credit record for up to seven years. During this time, the cost of credit for other goods and services will be higher, and additionally cost many job applicants to lose out on employment opportunities. For several years, credit score screening has become a part of the job application process for many employers.

 

“The numbers show that our current system is not working, and that higher education is not providing the pathway to financial stability that it once accomplished,” said Ashley Harrington, Policy Counsel and Special Assistant to the President of the Center for Responsible Lending. “We need federal and state policymakers to take concrete steps to effectively address this crisis, such as better regulation of for-profit colleges.

 

“As for loan servicers, it is time to hold them accountable for their errors,” continued Harrington. “Standardizing income-based repayment plans, and when appropriate, refinancing of student loans, should be offered as alternative options before allowing borrowers to default.”

 

 

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Charlene Crowell is the Communications Deputy Director with the Center for Responsible Lending. She can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..

Rep. Maxine Waters Takes Strong Stand for Fair Housing at HUD

July 1, 2018

 

Rep. Maxine Waters Takes Strong Stand for Fair Housing at HUD

New Legislation Would Restore Revoked Protections and Rules

By Charlene Crowell

watersofficial

 

(TriceEdneyWire.com) - When Dr. Ben Carson was named Secretary of the Department of Housing and Urban Development (HUD), many housing and civil rights advocates wondered how a world-renowned neurosurgeon would direct the future of housing in America. By his own admission, he arrived at HUD with no governmental experience or active interest in housing’s history either.

 

Despite those professional shortcomings, Secretary Carson swiftly began a series of actions that triggered broad and sustained criticism from civil rights and housing policy advocates. On Secretary Carson’s watch, HUD proposed billion-dollar budget reductions, increased rental fees for public housing tenants, removed explicit language on fair housing from the agency’s mission statement, and halted efforts that require local communities receiving HUD funds to address fair housing needs.

 

In sum, Secretary Carson has acted like a man on a mission with no time to spare.

 

This past January, Carson also announced a suspension of a key rule known as Affirmatively Furthering Fair Housing (AFFH). The rule that went into effect in July 2015 required any state, locality, or public housing authority receiving HUD funds to have a plan and timeline that incorporates community concerns to actively address fair housing issues in their locales.

 

Although civil rights and consumer protection advocates have brought legal challenges to reverse the suspension of AFFH and other misdeeds, the wheels of justice continue their characteristically slow and deliberate pace.

 

But California Congresswoman Maxine Waters recently stepped up to file legislation designed to cure many of the regressive ills pushed by Secretary Carson. On June 26, she introduced a bill entitled, Restoring Fair Housing Protections Eliminated by HUD Act of 2018 (H.R. 6220).

 

“The Department of Housing and Urban Development is supposed to create strong communities; expand access to affordable housing; and enforce fair housing rights,” said Congresswoman Waters. “Unfortunately since becoming Secretary, Ben Carson has taken numerous steps to eliminate fair housing protections for the most vulnerable families in this country.”

 

The following day, June 27, the House Financial Services Committee, chaired by Rep. Jeb Hensarling of Texas, convened a hearing with Secretary Carson.

“Over the last 20 years, the HUD budget has doubled, whereas the family budget, which pays for it, has increased by less than double digits,” said Rep. Hensarling. “In fact, HUD’s budget has grown faster than almost every other federal budget function, including social security, education, and national defense. HUD resources have not been the challenge, HUD’s focus and success has been.”

Speaking next as the Committee’s Ranking Member, Congresswoman Waters offered a completely opposite perspective on HUD and Secretary Carson. In her remarks, Rep. Waters underscored that her new legislation was intended to revoke key actions by Secretary Carson and return them to HUD’s fair housing agenda. Those actions included restoring:

 

  • Fair housing language to the agency’s mission statement with the specific inclusion of text stating “inclusive and sustainable communities free from discrimination”;

 

  • HUD’s AFFH rule as soon as practically possible following the bill’s enactment;

 

  • HUD’s Local Government Assessment Tool that helps state and local jurisdictions to comply with the AFFH rule within 30 days of enactment; and

 

  • A requirement that the HUD Secretary report to Congress a Secretary-directed review of fair housing complaints that involve an online platform. Additionally, the Secretary’s report to Congress would include: an analysis of trends and risks related to discrimination, steps to address such discrimination, and the status of complaints filed.

 

The legislation also includes a requirement that owners and operators of HUD-funded homeless shelters to post a notice informing clients of their rights under an agency rule regarding gender identity. This rule affects any grantee receiving funding through the agency’s Community Planning and Development program.

 

Before yielding back the balance of her time, the Ranking Member added, “Congress should not stand by while the agency charged with ensuring fair housing turns its back on its mission and takes actions that roll back critical protections that ensure that all Americans have fair access to housing.”

 

For his part, Secretary Carson noted that each year, HUD receives an estimated 8,000 fair housing complaints. In speaking to the 50th anniversary of the Fair Housing Act, he also added, “HUD and our fair housing partners continue to enforce the letter and [sic] spirit of this landmark law.”

 

Early reactions to Secretary Carson’s comments reflect how his words and his actions diverge.

 

“Fifty years ago, Congress empowered HUD to dismantle legalized discrimination in housing to create opportunity for all as where you live is a factor in so many of life’s outcomes, including education and healthcare”, noted Nikitra Bailey, an EVP with the Center for Responsible Lending (CRL). “Rep. Waters’ new bill requires HUD to remain steadfast in its responsibility to foster inclusive communities free of discrimination so that all Americans have the ability to thrive.

 

And Bailey is not alone. Beyond CRL, H.R. 6220 is also supported by several civil rights and housing advocates that include: National Fair Housing Alliance, The Leadership Conference on Civil and Human Rights, Local Initiatives Support Corporation (also known as LISC), NAACP Legal Defense Fund, Lawyers’ Committee for Civil Rights Under Law, National Community Reinvestment Coalition, National Housing Law Project, PolicyLink, and other organizations.

 

The bill has been referred to two House Committees, Judiciary and Financial Services. Time will tell whether in the year marking the golden anniversary of the Fair Housing Act if other Members of Congress will stand up for fair housing too.

 

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Charlene Crowell is the Center for Responsible Lending’s Deputy Communications Director. She can be reached atThis email address is being protected from spambots. You need JavaScript enabled to view it..

Inhumane Immigration Policy is an Inapt Solution to an Imaginary Crisis By Marc H. Morial

July 1, 2018

To Be Equal 

Inhumane Immigration Policy is an Inapt Solution to an Imaginary Crisis
By Marc H. Morial

marcmorial

(TriceEdneyWire.com) - “The facts set forth before the Court portray reactive governance -- responses to address a chaotic circumstance of the Government's own making. They belie measured and ordered governance, which is central to the concept of due process enshrined in our Constitution. This is particularly so in the treatment of migrants, many of whom are asylum seekers and small children”. -- U.S. District Judge Dana M. Sabrow, June 26, 2018

The images of weeping children housed in chain-link cages has horrified the nation. The Trump Administration’s “zero tolerance” policy of imprisoning asylum seekers and wrenching families apart has proved so toxic that it has been forced to abandon it – at least officially – and has been ordered to reunite those already separated.

Meanwhile, the House of Representatives failed to pass a broad immigration bill that would have addressed family separations at the border and the status of Dreamers – another “chaotic circumstance of the Government’s own making” resulting from cancellation of the Deferred Action on Childhood Arrivals (DACA) program.

It’s hard to imagine what kind of crisis would justify the trauma being inflicted on refugee families and Dreamers. But the fact is, there is no crisis.

Illegal crossings of the southern border have steadily declined over the last decade, last year reaching its lowest level in nearly 50 years. Writing in The Atlantic, City University of New York Professor Peter Beinart points out that, despite a slight uptick this year, drastically falling birth rates in Mexico mean there simply is a far smaller pool of potential migrants. A higher percentage of those crossing the southern border now are fleeing violence-plagued Guatemala, Honduras, and El Salvador.

It is these refugees who make up the overwhelming majority of children who have been separated from their parents.

What effect do these illegal border crossings have on American society, that such drastic measures should be taken in response? Claims of an immigrant-fueled crime wave are blatantly false. According to a study by the National Academy of Sciences, "Immigrants are in fact much less likely to commit crime than natives, and the presence of large numbers of immigrants seems to lower crime rates." The study added that "This disparity also holds for young men most likely to be undocumented immigrants: Mexican, Salvadoran, and Guatemalan men."

The study concluded, "Today, the belief that immigrants are more likely to commit crimes is perpetuated by ‘issue entrepreneurs’ who promote the immigrant-crime connection in order to drive restrictionist immigration policy."

What of the economic effects of immigration? The U.S. Department of Health and Human Services last year found that refugees brought in $63 billion more in government revenues over the past decade than they cost.  The Trump Administration rejected the findings.

With falling rates of illegal border crossings, relatively low crime rates among immigrant communities and a net positive economic benefit from refugees, what could possibly be fueling the Administration’s brutal crackdown on immigrants?

One clue may lie in the fact that negative views about immigrants was a significant factor in determining how people voted in the Presidential election. The so-called immigration crisis is a classic case of inventing a disease in order to sell the cure. But instead of losing a few dollars to gain a bottle of useless snake oil, we are losing our soul as a nation and gaining the destructive force of fear.

Commemorative Events Planned for Mandela's Centenary

 

July 1, 2018

Commemorative Events Planned for Mandela's Centenary

 

centenary-mandela

 

mandelacelebrating

 

(TriceEdneyWire.com/GIN) – It is easy to break down and destroy. The heroes are those who make peace and build.

 

Those were the prophetic words of President Nelson Mandela whose role in the long struggle waged against the racist system of apartheid is recalled on the anniversary of his birth on July 18, 1918.

 

This year, the theme of the birthday Centenary is world peace. Events will take place worldwide to commemorate the former leader.

 

A “Nelson Mandela Peace Summit” will take place at the U.N. with speeches by top UN officials, the chair of the African Union Commission and member states.

 

In Johannesburg, the Mandela Concerts have pledged to raise money for literacy projects including 100 new library units for schools in South Africa and a digital library.

 

On July 17, former president Barack Obama will deliver the Nelson Mandela lecture, whose theme of renewing the Mandela legacy and promoting active citizenship in a changing world was developed after the passing of Winnie Madikizela-Mandela.

 

Former Obama speechwriter Ben Rhodes commented: “The choice of Mandela and South Africa are freighted with symbolism for Obama at a time when his political legacy is being dismantled by his successor, Donald Trump, who has crudely disparaged African countries.”

 

At press time, however, two South African organizations disputed the invite to Obama for “cultivating a new kind of colonialism in the name of the 'War on Terror', spreading fear, violence and destruction, in particular among Muslim communities, rubber-stamping over 100 military actions a day throughout Africa, and many more in the Middle East."

 

"US foreign policy has left destruction, division and suffering in its wake, and led to the rise of violent groups," said Feroze Boda, spokesperson for CAGE Africa - an organization that opposes the so-called War on Terror.

 

Palestine Solidarity Alliance spokesperson Naazim Adam also objected to the decision to invite Obama, recalling the thousands of civilian casualties in Somalia, Pakistan, Afghanistan and Syria that continued under Obama's presidency.

 

Mandela Foundation chairperson Professor Njabulo Ndebele defended the decision to invite Obama, noting that Madiba had great respect for the first Black U.S. President.

 

"In an era defined by worsening tensions between people, in which the spectre of exclusion and intolerance across the world seems to become normalized, the messages of President Obama, like those of Madiba, must be given space," Ndebele said.

 

"Furthermore, the foundation's key focus areas, including the eradication of poverty and inequality and the dismantling of anti-black racism, are causes that are close to President Obama’s heart. His historic election as the first black president of the United States does have resonance in South Africa, as do many of his pro-poor policies, such as universal healthcare."

 

GLOBAL INFORMATION NETWORK creates and distributes news and feature articles on current affairs in Africa to media outlets, scholars, students and activists in the U.S. and Canada. Our goal is to introduce important new voices on topics relevant to Americans, to increase the perspectives available to readers in North America and to bring into their view information about global issues that are overlooked or under-reported by mainstream media.

A Wake-up Call for Democrats By Julianne Malveaux

July 1, 2018

A Wake-up Call for Democrats
By Julianne Malveaux

malveaux

 

(TriceEdneyWire.com) - I've never met Alexandria Ocasio-Cortez, a 28-year old New York activist, but I am surely looking forward to it.  This giant-slayer of an organizer (she worked for Senator Bernie Sanders during the 2016 campaign) was out-spent, but certainly not out-worked, by her opponent, Rep. Joseph Crowley (D-NY). 

 

Crowley had served in Congress for ten terms and was the fourth-highest ranking Democrat in Congress, one who had openly coveted Congresswoman Nancy Pelosi's position as Minority Leader in Congress.  He spent $1.5 million in his first primary race since 2004, while Ocasio-Cortez spent just a fraction of that.


Congresswoman-elect Alexandra Ocasio-Cortez (wow!  It feels good to type that, and she is a shoo-in because the district is mostly Democratic) won because, despite fewer funds and less name recognition, she had a ground game that did not quit. The day after her election, she told CNN that her team "knocked on doors that had never been knocked on, reaching voters who had been dismissed."  Lacking money for the television ads Crowley spent hundreds of thousands of dollars on, Ocasio-Cortez used social media to get the word about her candidacy out. 

 

She didn't mind being sharply critical of Crowley, highlighting his disconnection from the New York district that includes parts of the Bronx and Queens, and focusing on the demographic mismatch between a 50 plus white man representing a district that is majority minority. Ocasio-Cortez's hard work paid off – she had more than 57 percent of the vote, hardly a nail-biter.

 

In some ways, Ms. Ocasio-Cortez sounds something like Stacey Abrams, the Democratic powerhouse who made history when she became the first-African American woman to win a primary party nomination for governor and in the South, at that.  When Abrams first declared her candidacy she was met with skepticism, and especially from some in the Democratic Party establishment.  But she had been registering some of the voters that the party had ignored, and if she can get about 100,000 more registered and voting, she has an excellent chance of being elected governor.

 

Unfortunately, the national Democratic Party and some state parties have done a poor job of dealing with the nation's shifting demographics, and with the demand from younger, browner, and more focused voters to dispense with business as usual.  In Washington State, for example, Tirzah Idahosa is a candidate for the 30th Senate District.  The union member, volunteer lobbyist, former correctional officer and foster parent is a founder of Democrats for Diversity and Inclusion and a precinct captain.  In a primary race with another Democrat, she tells me that she has been advised to "wait her turn" or to run for something "lesser" like the school board.  Don't these mainstream Democrats get that advising folks to "wait their turn" is what is turning so many away from the polls?  President Barack Obama didn't wait his turn when he was advised to, and he beat Hilary Clinton soundly and out of turn!

 

 Mainstream Democrats didn't get the Bernie memo, but Senator Bernie Sanders had a good night on Tuesday, June 25.  Not only did he have the Ocasio-Cortez victory to savor, but another of his acolytes, former NAACP President Ben Jealous, won the Democratic gubernatorial nomination in Maryland.  His opponent, Prince George's County Executive Rushern Baker, was in many ways both the superior candidate and the one better poised to beat Republican governor Larry Hogan.  But Jealous had the Bernie machine and the enthusiasm of younger people who saw Baker as "business as usual."

 

 In Boston, City Councilor Ayanna Pressley has challenged incumbent Representative Mike Capuano (D-Ma) for his congressional seat.  Capuano has used the power of his incumbency to persuade members of the Congressional Black Caucus, including civil rights icon, Congressman John Lewis, to support him, a colleague, instead of Councilor Pressley.  If some of the CBC representatives spent time with Ayanna Pressley, they'd like her and wish they had someone with her passion as a colleague.  But Capuano thinks his seniority (he has only been in office 5 years) should be persuasive and dismissed Pressley's candidacy by telling the Boston Globe "if we decide to send junior people, good luck." 

 

His rank will yield his a key subcommittee chairmanship in Congress if Democrats can take the House back.  Or, if Democrats can win the house, it will put Pressley in line to be a committee chair just a few years from now.   Capuano forgets that demographics have shifted in his Congressional district, which is now majority-minority.  He also ignores that fact that not so long ago he, too, was a junior person in Congress.


Younger, more progressive Democrats like Ocasio-Cortez and Pressley aren't trying to "wait their turn," they are trying to turn our country around.   The Democratic Party ought to look at these candidacies as a second wake-up call.  The first happened when Senator Bernie Sanders nearly beat Senator Hillary Clinton for the Democratic nomination and lit a fire among young change agents that won't be contained by the power of incumbency or the condescending rhetoric that folks should "wait their turn."

 

Julianne Malveaux is an author and economist. Her latest book “Are We Better Off? Race, Obama and Public Policy” is available via www.amazon.com for booking, wholesale inquiries or for more info visit www.juliannemalveaux.com

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