LOWELL MA—Beej Das, Democratic candidate for Congress in Massachusetts third Congressional District, released the following statement unveiling his student debt proposal:
“The one percent got their tax cut,” said Das. “Now it’s our turn. Student debt is a crippling burden for millions in the country. It’s also a crippling burden on the economy. Americans face a total of over $1.4 trillion in debt.”
On the first day in Congress, Das plans to introduce “An Act to Abolish All Student Debt.” This would instruct the federal government to fully buy out all student loan debt. This would include a cancellation of all federally held student loans, and the purchasing and cancellation of all privately held student loans. It would authorize a one-time payment equal to the amount of the student debt, currently $1.356 trillion, to the Department of Education (DOEd). $978 billion would cancel federally held debt, $267 billion to purchase and cancel private government secured debt, and $102 billion to purchase and cancel private non-government secured debt.
In 2006, the average student loan for graduates was roughly $19,000. In 2016 graduates have an average debt burden of more than $37,000. With an average monthly payment of $351, it is no wonder more than 10% of borrowers are delinquent on their loans.
In order to pay for this debt cancellation, Das proposes a Financial Transaction Tax (FTT) on Wall Street speculation, with a 0.1% tax on shares and bonds, in addition to a 0.01% tax on derivatives. Europe and China both utilize the FTT model, and it has not harmed their economies. Wall Street got a bail out; it’s time the middle class got theirs.
“I understand the magnitude of what I am proposing,” said Das. “The burden will only get worse if we nibble at the edges of the problem or wish it away. The student loan industry is a massive construction of special interests thriving off the backs of people who just want an education to build a career and live the American dream. Let’s clean the slate.”
In addition to the elimination of, Das proposes the following:
● Financial literacy classes in high school
○ Develop a standard curriculum on loan debt, credit card debt, interest rates, and how to build a strong credit score
● Student bill of rights
○ Modeled after the legislation that the Massachusetts’ Senate passed to create a licensing system for loan providers and appoint an individual to be able to oversee complaints
● Lock in tuition and fee rates for each student upon enrollment
○ When an individual takes out a mortgage loan or a car loan, the cost of product does not increase. A student should be able to make a college decision with the understanding of exactly what the final bill will be.
● A standardized process for transfer credits, AP credits
○ Thousands of students across the country have had to take additional classes, at an increased cost, because their institution of higher learning does not accept their credit from another setting. In the instance of Advanced Placement classes, high school students are told that they can earn college credit, but some institutions, in order to be able to charge a student for the class, do not count the credit towards a degree.
○ Das would call for a national standard so students are not forced to take duplicative classes, simply to allow multiple institutions to profit off of them.