Posted by Guest on July 13, 2017 in Blog
By Sarah Decker
“One of the most damaging but least talked about components of Trump’s Budget is its proposal to terminate public service loan forgiveness.”
When asked what she was most concerned about with the new administration’s 2018 budget, SurvJustice founder Laura Dunn was clear: the elimination of the program that enabled her to pursue her passion and start a national nonprofit. A survivor of campus sexual assault herself, Dunn explained the lasting downfall of such a proposal during a congressional briefing held by AAI on July 6th. “We cannot have this generation rise up and work in public service if they are crippled by debt.”
The elimination of loan forgiveness provides a one-two punch to Trump’s other proposals that, as discussed during the event, severely impact civil and human rights for vulnerable populations including minorities, victims of sexual assault and the LGBTQ community. It will also severely decrease the diversity of key professions in the U.S., including law, politics, business, education and medicine – which typically require graduate or professional degrees.
The Trump administration’s proposed budget for the 2018 fiscal year calls for eliminating a major student loan forgiveness program designed to assist nonprofit and government workers, including lawyers, teachers and social workers. The budget calls for an overhaul of the students lending system in order to streamline the many options the government offers to borrowers.
Part of these reforms involves ending the Department of Education’s Public Service Loan Forgiveness program (PSLF). This program forgives borrowers’ balances after ten years of working for a qualifying employer in either government or the nonprofit industry.
According to the text of the budget, dubbed “A New Foundation for American Greatness,” “these reforms will reduce inefficiencies in the student loan program and focus assistance on needy undergraduate student borrowers instead of high-income, high-balance graduate borrowers. All student loan proposals apply to loans originated on or after July 1, 2018, except those provided to borrowers to finish their current course of study.” Although this proposal will not impact current borrowers, it promises to end the PSLF program for future generations, dramatically impacting the very workforce that will have to live with many of Trump’s other polices.
At a time when we will need public service-oriented lawyers, such as public defenders and advocacy-based civil litigators, to help dismantle discriminatory policies, most potential employees will not be able to afford to take these jobs.
Aside from eliminating PSLF for future generations, the budget proposal ends subsidized loans for low-income students and cuts an additional $76 billion from the student loan program over a decade. This involves a revised system in which students pay more of their earnings each year under a different income-based repayment plan: paying 12.5% for 15 years instead of 10% for 20-25 years.
These changes won’t necessarily negatively impact only those with undergraduate loans. Higher repayment in a shorter amount of time would mean less accrued interest (hence Trump’s assertion that this plan keeps the government from making money off of student loans). But those with graduate debt will have to spend 30 years paying off their loans, instead of 25. So, those with advanced degrees required for law, teaching, or medicine, for example, will end up paying more in the long haul.
Given that graduate degrees are only becoming more essential in the workplace, even in lower-paid fields like teaching, these reforms are especially problematic for future generations of students. Radhika Singh Miller, the director of the Civil Legal Aid Initiative at the National Legal Aid and Defender Association (NLADA) explained the impact to Vice."What we would see if this program is eliminated in terms of recruitment of public defenders is that the demographics would really start to shift, and impact the abilities of these offices to really help the communities they serve."
The demographic shift that Miller describes would include a change in applicants where those who cannot afford to pursue higher education would not have the ability to become professionals and serve their own communities. This poses an immense challenge for minority communities to help themselves: there would be fewer trans lawyers fighting for bathroom rights, fewer African American lawyers opposing police violence, and fewer Muslim lawyers working to reverse the Muslim ban.
A 2015 report commissioned by the National Legal Aid and Defender Association found that nearly 70 percent of public defenders surveyed began or continued employment at their nonprofit jobs because of the federal loan forgiveness program. The PSLF both encourages students to pursue careers in public service and incentivizes them to stay in these careers for ten years – enabling government agencies and nonprofit organizations to hire those who can excel in their careers and provide much needed stability and institutional memory.
According to Isaac Bowers, director of law school engagement and advocacy at Equal Justice Works, while prospective law and other professional students will have their options severely limited, the real victims of this proposal are the communities that rely on these services. “Public Service Loan Forgiveness is not really about the borrower,” Bowers said. “It’s about the recruitment and retention of public service into these long-term public service careers and the communities they serve. Ultimately the people who will be hurt are the beneficiaries of these legal, medical, social work service providers, and the students who will not have teachers who are as dedicated and long serving.”
Equal Justice Works is currently aligned with a coalition of organizations for doctors, nurses, social workers, and other professions that qualify for the program and is planning a lobbying campaign in support. The American Bar Association, the Association of American Law Schools, the Law School Admission Council, and the National Association for Law Placement are also among the groups lobbying Congress to maintain the program.
In order to ensure adequate representation in the most important fields for ensuring the rights and wellbeing of minority groups across the country – law, education, and social work– Congress needs to protect the PSLF program from being dismantled by Trump’s proposed budget.
Sarah Decker is a Summer 2017 intern at the Arab American Institute.