WANNA BLESS BLACK WOMEN? FIGHT TO CANCEL STUDENT LOAN DEBT!

By the most recent count, the federal student loan balance clocks in at around $1.6 trillion, with about 44 million being on the hook for that rather princely sum. The average student loan debtor owes $37,3888 to Uncle Sam. Include the dollars borrowed from private lenders and you’re looking at an average debt load of about $40,000.

Between 2011 and 2022, the total amount of outstanding student loan debt soared from $959,823,950,000 to $1,757,200,000,000, an increase of slightly more than 81%. In any case, when we talk about student loan debt now, we’re talking in trillions, not billions.

And each month, prior to the temporary pause on payments authorized by the Biden administration, these borrowers we’re coughing up a nice chunk of change every month to make that student loan payment. Just a few years ago, for instance, a survey conducted by TD Bank found that, on average, borrowers were spending 20% of their monthly take home pay on student debt.

That’s a hefty knot to swallow every month and it crimps the amount of cash that the typical borrower has to spend on such other items as child-care, auto expenses, food, housing, and out-of-pocket medical costs.

Thanks to the Biden administration’s extension of the temporary pause on student loan payments, borrowers have not had to worry about coming up with that money. Stuff is sort of in limbo because the Supreme Court has yet to rule on the legality of Biden’s proposed student debt relief plan but, in all likelihood, it’s a pretty good bet that there’ll be a resumption in loan payments no later than by the end of this summer, if not earlier.

More generally, there’s a lot at stake in how the nation responds to the myriad manifestations of the student loan crisis. Much is at stake for millions—and this is especially true for a group that’s too often invisibilized.

Black women.

YOU GOTTA PAY TO PLAY

If you’re going to go to school nowadays, it’s pretty much a settled matter that you and your parents are going to have to come up with some serious bread. It’s a sure thing because, first of all, very few households have the type of money to cover the increasing costs of attending college, even after taking into account any scholarships and grants the prospective student might receive.

And that cost has been soaring: Between 1980 and 2020, the average cost of a public four year college soared from $9.317 to $25,593. That’s an astounding 64% increase over a four decade period and, mind you, those figures are adjusted for inflation; in other words, that 64% jump is what economists and statisticians call a “real” or “constant” rate of increase. Over this same period, though, wages increased substantially for those at the top of the distribution but either grew at a slower rate or decline for those in the middle and bottom of the distribution.

The soaring cost of attendance, the shifting of those costs onto students and their parents, the slow increase or stagnation in earnings for most households, and the large decline in the percentage of the full cost of attendance at public four-year college covered by the Pell Grant— all of this, again, underscores that students and their families are going to have to come up with pretty big dollars for college enrollment to become a reality.

And for the typical student this means borrowing or going into debt—and I mean tens of thousands of dollars in debt— in order to get that degree.

The way we “do” post-secondary education in this country, you’ve got to pay to play.

THE COST OF COPPING THAT CREDENTIAL

While everyone—with the exception of those from households with seriously deep pockets— have to borrow to cop those highly prized post-secondary credentials, it’s Black women who are in the unenviable and costly position of leading the pack when it comes to being on the hook for student loan debt.

A study by the Education Trust, for instance, finds that twelve months after earning the bachelor’s degree, Black women owe an average federal student loan debt of $38,800. That’s 30% more than $27,068 owed by comparable White women. It’s also 37% and 7.2% more than that owed by White and Black male holders of the BA degree. So, again, when it comes to the amount of money borrowed to get that degree, Black women are the group that’s deepest in debt.

That same study by Education Trust reveals another debt number that is nothing short of whopping: Black women who attended graduate school hold an average of $58,252 in graduate loans, compared to “just” $29,323 for White women. In other words, when the analysis moves from undergraduate to graduate status, the amount of debt owed by Black women soars from being 30% to 50% more than that owed by comparable White women.

And how about the amounts owed by White and Black men who attended graduate school? Well, the respective amounts held by these two groups are $25,905 and $49, 416, respectively. In other words, Black women who attended graduate school owe 56% more in debt than White men who attended graduate school, and 15% more than Black men.

Yeah, you read that right: When the focus moves from undergraduates to graduates, Black women move from owing 7.2% to 15% more than Black men and from owing more 50% to 56% more than White men.

MORE DEBT, SMALLER EARNINGS

Given the huge piles of student loan debt perched on the shoulders of Black women, it’s not surprising that they’re especially likely to struggle to make those monthly payments and to knock the size of that debt down.

For one thing, the median earnings of Black women are typically lower than that of other groups in the labor force, with an earnings disparity existing across educational levels.

As an example consider the following earnings data on women aged 25-64 and who work full time, year round (FTYR):

• The median earnings for Black women with “some college, no degree” is $38, 837. The comparable numbers for White women, White men, and Black men are$41,882, $58,198, and $49,916, respectively. The median earnings of Black women with “some college, no degree,” then, is only 66% of that earned by White males with “some college, no degree.”

• The median earnings for Black women with a “bachelor’s degree or higher” is $60, 681, compared to $91, 905 for their White male counterparts.

• Black women who work full-time, year round (FTYR) must earn a “bachelor’s degree or more” just to earn as much as a White male who has “some college, no degree.”

In short, Black women experience both a gender and a racial gap in earnings and the interaction between these two disparities undoubtedly contribute to the difficulty they experience in wiping out their student debt.

MORE DEBT, LESS WEALTH

Wealth or net worth is simply the monetary difference between what you own and what you owe; it’s your assets less your liabilities. And, among other things, it can serve as a pad that helps to launch you onto a path that can lead to such accomplishments as building a business, purchasing a home, and securing an educational credential without having to hock your future. It can also serve as a safety net that can cushion a fall resulting from a negative event—such as losing your gig— and that can help you keep up with monthly payments—like making student loans— if your flow of income slows up or just flat out ceases.

When it comes to Black women, student loan debt, and wealth, the story can perhaps best be summarized as “More debt, less wealth.” That “launching pad” and “safety net”— at least when it comes to the net worth of Black women— are riddled without holes.

A recent study by the Federal Reserve Bank of St. Louis, for instance, paints a picture that shows just how little wealth is possessed by Black women.

Here’s some of the study’s findings:

• Black women hold 5 cents for every dollar of median wealth held by White men

• The median wealth of single Black women clocks in at $8200, compared to $92,300 for single White men, $85,700 for single White women, and a paltry $15,700 for single Black men.

• The median wealth of married Black women is a paltry $48,100, compared to $333,000 for White men, $199, 900 for White women and $87,300 for Black men.

Things ain’t so good for younger Black women either. That this is so is revealed in a study that focuses on the median wealth or net worth held by women under the age of 35:

• The median wealth of single White men under the age of 35 is 3.5 times greater than the median wealth of young, single White women, almost 15 times greater than that of single Black men, and an eye popping 224 greater than that of Black women.

• The racial divide in wealth amongst younger folk does not evaporate over time: By the age of 55, large racial gaps continue to persist.

Another study finds that Black women have far less wealth than White women, regardless of their level of education:

• The median wealth of single Black women with “no bachelor’s degree” is about $500, compared to a median wealth of $8,000 for White women with “no bachelor’s degree.”

• There’s a $30,000 difference between the median wealth of single Black and White women with a bachelor’s degree: $5,000 for Black women versus $35,000 for White women.

• Black women who are at least 60 years old and with a college degree have a median net worth of $11,000. In contrast, the median wealth of older White women with a college degree is 35 times as large— $384,400 versus $11,000.

There’s just no way of getting around it.

Slice it. Dice it. Or whatever.

Black women, even when they have big incomes, are likely to be asset poor.

And it’s hard to fathom how this could not play into the higher amounts of debt that they borrow in order to pursue advanced degrees, as well as the difficulties that they may face in coming up with them monthly payments once they enter the repayment period.

So, just in case it’s unclear, here’s what I think:

I think a lot is at stake, particularly for Black women, as we await the Supreme Court’s decision on Biden’s proposal to cancel up to $20,000 in student loan debt for those households earning less than $125,000 per year.

I think that $20,000 is far too low but, ultimately, the decision is not about a specific amount. It’s about whether, in principle, the President, under the Heroes Act of 2003, has the power to wipe student loan debt off the personal balance sheets of millions of Americans.

That Supreme Court decision will touch on the broader permissibility of student debt cancellation.

Period.

I also think that one way to bless Black women, to narrow the racial divide in wealth, to assist financially struggling working class people who have to swallow that monthly note, and to give regular Americans the same chance for a “do-over” that we give the rich and powerful is to cancel student loan debt.

All of it.

Now.

There’s a lot at stake.