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NextGen Magazine

 
 

State Attorneys General Urge $50K in Student Loan Cancellation

By:
Chris Gaetano
Published Date:
Feb 19, 2021
A coalition of 17 state attorneys general, led by New York Attorney General Letitia James and Massachusetts Attorney General Maura Healey, expressed their support for canceling $50,000 in student debt, a proposal that the president effectively ruled out at a recent town hall. The two are joined by the attorneys general of Connecticut, Delaware, Hawaii, Illinois, Maryland, Minnesota, Nevada, New Jersey, New Mexico, Oregon, Vermont, Virginia, Washington, Wisconsin, and the District of Columbia, in a letter addressed to congressional leaders.

The attorneys general cited not only their direct observations on how much student loan debt is hurting young people, but their experiences with predatory lending practices at certain for-profit schools.

"Many struggling borrowers are victims of predatory for-profit colleges that lure students with false promises and leave them with worthless degrees, few job prospects, and insurmountable debt.," said the attorneys generals' letter. "Our Offices have expended substantial resources combatting misconduct by for-profit colleges. Through these efforts, we know that students who attend for-profit schools are disproportionately likely to suffer dire consequences from the Federal student loans they obtain to pay their tuition."

They also criticized current loan aid programs as insufficient to address the scope and scale of the problem, noting, for example, that only 2 percent of borrowers who applied for loan discharges under the Public Service Loan Forgiveness program have been granted a discharge. In addition, efforts to obtain student loan discharges for defrauded students—to which students are entitled under existing law—have been stymied by the U.S. Department of Education for years.

It is unknown the degree to which the letter will ultimately influence policy on this matter.