The Long History Of Debt Cancellation

posted by S. Abbas Raza in 3 Quarks Daily: Olivia Schwob in the Boston Review:


unattributed

Today the phrase “debtors’ prison” is often invoked to describe this experience of punitive indebtedness. Sometimes it is meant literally.

Consider Melissa Welch-Latronica, a thirty-year-old single mother, who in February was wrenched from her minivan and thrown into a jail cell in Porter County, Illinois, over failure to pay an ambulance bill.

Her story is unusual but not unique.

A 2018 ACLU report documented a thousand cases of the “criminalization of private debt” and compiled a dozen of the most extreme stories. Most of the people featured ended up in jail because they failed to appear in court over unpaid debts, resulting in a warrant.

And then there is the abominable, systemic cycle of incarceration and reincarceration of poor people – and particularly poor people of color – unable to pay fines and court fees.

Continue reading

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How Wiping Out $1.5 Trillion In Student Debt Would Boost The Economy

posted by S. Abbas Raza in 3 Quarks Daily

Jillian Berman in Market Watch:



Student-debt cancellation, once viewed as a niche political issue, has now, with loans topping a staggering $1.5 trillion, made it onto the platforms of major presidential candidates.

Since at least the Great Recession a decade ago, borrowers, activists and others have been building a case that erasing debt acquired during students college years is a matter of economic justice. More recently, researchers have found that canceling some or all of the nation’s outstanding student debt has the potential to boost gross domestic product, narrow the widening racial wealth gap and liberate millions of Americans from a financial albatross that previous generations never had to contend with.

Sens. Elizabeth Warren and Bernie Sanders, both vying for the Democratic nomination for president, are proposing to wipe away some or all of the country’s burdensome debt as a key part of their campaigns. They plan to pay for it — and accompanying proposals to make public college tuition-free — by raising taxes on the wealthy. Warren estimates her plan would cost $1.25 trillion over 10 years, and Sanders says his would cost $2.2 trillion.

Critics question whether those proposals would fix the underlying problems in the way Americans pay for college, and also whether student-debt cancellation would entail a giveaway to well-off families.


More here.


Hazel's comment:
Yes, this is about the USA but the debts of many UK students are astronomical (not, of course, in Scotland), My granddaughter graduated this year and walked into a job the following week, she was lucky in that regard but she has no hope of paying off her student loan and the interest mounts up when you don't/can't pay.

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Student budgets and widening participation: Comparative experiences of finance in low and higher income undergraduates at a northern red brick university

an article by Rita Hordósy and Tom Clark (University of Sheffield, UK) published in Social Policy & Administration Volume 53 Issue 5 (September 2019)

Abstract

Drawing on a thematic analysis of longitudinal qualitative data (n_total = 118), this article takes a “whole student lifecycle” approach to examine how lower and higher income students at an English northern red brick university variously attempted to manage their individual budgets. It explores how students reconcile their income — in the form of loans, grants, and bursaries — with the cost of living.

Four arenas of interest are described:

• planning, budgeting, and managing “the student loan”;
• disruptions to financial planning;
• the role of familial support; and
• strategies of augmenting the budget.

In detailing the micro‐level constraints on the individual budgets of lower and higher income undergraduates, the article highlights the importance of non‐repayable grants and bursaries in helping to sustain meaningful participation in higher tariff, more selective, higher education institutions.

It also supports an emerging body of literature that suggests that the continuing amendments to the system of funding higher education in England are unlikely to address inequality of access, participation, and outcome.

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