If Trump Doesn't Cancel Student Debt On His Way Out, It's Not Likely That Relief Will Be Coming

Roland put himself through college with the help of student loans and now he teaches school, his student debt still hanging over his head. He told me that Biden issuing to go down as the greatest president in his lifetime by wiping out student debt. But that's not going to happen; neither will. Biden is not going to wipe out student debt and Biden is not going to go down as the greatest president in his or anyone else's lifetime. In fact, judging by his record as a senator from 1973 to 2009, Biden will go down in history as the second worst president in all of our lifetimes. Almost all. Some of us may have been alive in 1932 when the American people rose up and drove Herbert "Great Depression" Hoover out of the White House. In that case-- if you were born in 1933 or earlier-- Hoover would be the second worst president of your lifetime.

Hoover only carried 6 states (59 electoral votes)-- Maine, Vermont, New Hampshire, Connecticut, Pennsylvania and Delaware. He lost the popular vote 57.4% to 39.7%. It has taken until 2016 for Americans to saddle themselves with a worse-- and more destructive-- president than Hoover.

In 2015, as Biden was ending his second term as vice president and still hoping to run for president, International Business Times published a widely read piece by David Sirota and Matthew Cunningham-Cook, Joe Biden Backed Bills To Make It Harder For Americans To Reduce Their Student Debt. They noted that "in the past, overwhelmed student debtors were able to go to bankruptcy court "to shield them from some of their creditors. But a provision slipped into federal law in 2005 effectively bars most Americans from accessing bankruptcy protections for their private student loans. In recent months, Democrats have touted legislation to roll back that law, as Americans now face more than $1.2 trillion in total outstanding debt from their government and private student loans. The bill is a crucial component of the party’s pro-middle-class economic message heading into 2016. Yet one of the lawmakers most responsible for limiting the legal options... is the man who some Democrats hope will be their party's standard-bearer in 2016: Vice President Joe Biden. As a senator from Delaware-- a corporate tax haven where the financial industry is one of the state’s largest employers-- Biden was one of the key proponents of the 2005 legislation... That bill effectively prevents the $150 billion worth of private student debt from being discharged, rescheduled or renegotiated as other debt can be in bankruptcy court.

Biden's efforts in 2005 were no anomaly. Though the vice president has long portrayed himself as a champion of the struggling middle class-- a man who famously commutes on Amtrak and mixes enthusiastically with blue-collar workers-- the Delaware lawmaker has played a consistent and pivotal role in the financial industry's four-decade campaign to make it harder for students to shield themselves and their families from creditors, according to an IBT review of bankruptcy legislation going back to the 1970s.

Biden's political fortunes rose in tandem with the financial industry's. At 29, he won the first of seven elections to the U.S. Senate, rising to chairman of the powerful Judiciary Committee, which vets bankruptcy legislation. On that committee, Biden helped lenders make it more difficult for Americans to reduce debt through bankruptcy-- a trend that experts say encouraged banks to loan more freely with less fear that courts could erase their customers’ repayment obligations. At the same time, with more debtors barred from bankruptcy protections, the average American’s debt load went up by two-thirds over the last 40 years. Today, there is more than $10,000 of personal debt for every person in the country, as compared to roughly $6,000 in the early 1970s.

That increase-- and its attendant interest payments-- have generated huge profits for a financial industry that delivered more than $1.9 million of campaign contributions to Biden over his career, according to data compiled by the Center for Responsive Politics.

Student debt, which grew as Biden climbed the Senate ladder and helped lenders tighten bankruptcy laws, spiked from $24 billion issued annually in 1990-91 to $110 billion in 2012-13, according to data from the Pew Research Center.

...“Joe Biden bears a large amount of responsibility for passage of the bankruptcy bill,” Ed Boltz, president of the National Association of Consumer Bankruptcy Attorneys, said in an interview with IBT.

That legislation created a crisis, said Northeastern University law professor Daniel Austin. Federal Reserve data show that about 1.1 million people face student debt loans of $100,000 or more, and roughly 167,000 face student loans of $200,000 or more.

“It is perverse and obscene,” Austin told IBT. “We are creating a generation of indentured people. It is mind-boggling that we would do this to a whole generation of young people. I can’t understand any other modern society doing this.”

...[T]he legislation produced by Biden and his fellow conferees ended up including the provisions exempting government-sponsored educational loans from traditional bankruptcy protections for at least five years after a student graduates. In announcing the final deal, the sponsor of the bankruptcy legislation, Sen. Dennis Deconcini (D-AZ) specifically thanked Biden in a floor speech for his “lengthy and time exhausting work” on the measure.

Within a few years, the crackdown that began in 1978 would extend beyond just government loans. In 1984, as Biden was gaining seniority on the Judiciary Committee, the Delaware lawmaker reprised his role as one of his party’s top negotiators on a new legislative proposal. Under that bill -- which was signed into law by President Ronald Reagan -- bankruptcy exemptions were extended to non-higher-education loans like those for vocational schools, according to the U.S. Department of Education.

Then came the 1990 Crime Control Act, whose chief sponsor was Biden. Though the bill was primarily focused on toughening criminal sentences, Biden’s legislation also included provisions that further lengthened the amount of time debtors would have to wait before they got access to traditional bankruptcy protections for their federal and nonprofit student loans.

In 1997, a federal panel appointed by President Clinton recommended that Congress reverse all the changes, and once again make student loans dischargeable in bankruptcy court like other forms of consumer debt. But lawmakers went in the other direction, making it even harder for student debtors to get bankruptcy protections. With Biden’s support, Congress in 1998 passed a law limiting bankruptcy protections for educational loans to students who could prove their loans were an “undue hardship.”

...Despite opposition from Wellstone and other liberals, Biden became a prominent Democratic supporter of legislation in 2000 to further restrict bankruptcy protections. The initiative was backed by one of Biden’s top supporters: Delaware-based credit card titan MBNA. Not only had the company’s employees collectively become one of his largest campaign contributors, the firm had employed Biden’s son Hunter right out of law school and later paid Hunter Biden consulting fees while his father pushed the bankruptcy bill. MBNA's top executive had purchased Biden’s Delaware home for a price that Biden’s political opponents depicted as a sweetheart deal to a powerful legislator.

But while the bill was primarily viewed as an initiative for credit card firms, it included a little-discussed provision to continue the crackdown on student debtors. Buried in the 400-page legislation was a section designed to make it more difficult for students to get bankruptcy protections not just for their government and nonprofit loans, but also for the educational loans they received from private financial firms.

“The lenders have put constant pressure on Congress to exempt as much as possible from being discharged in bankruptcy over the years, and they succeeded by creating the caricature of a deadbeat who knowingly runs up debt rather than the reality of hardworking students reaching for the American dream but unable to find jobs when they graduate,” Dennis Kelleher, a former Democratic senate aide who now runs the Wall Street watchdog group Better Markets, told IBT.

Biden helped the banking industry promote the negative portrayal of debtors. During the 2000 debate, he said the goal of the bankruptcy bill he was backing was “to assure that those who have the ability to pay do not walk away from their legal debts.”

It just got worse and worse. It never stopped. Biden was the most anti-student Democrat in the country. Read the rest of the sickening IBT story. Even pro-Wall Street Bill Clinton vetoed one of his vicious anti-student bills, a bill Biden helped get passed when George W. Bush followed Clinton into the White House. Biden was the complete right-wing asshole. "When the bill first came up, Biden cast the only Democratic vote for it in the Judiciary Committee, allowing the measure to advance to the Senate floor. Biden then worked aggressively to promote the legislation’s passage. During a floor debate with Feingold over the measure, he presented his effort to help the financial industry pursue debtors as a crusade to keep overall interest rates low for consumers." He attacked and slandered Russ Feingold for standing up for student debtors. "The head of one trade association for lenders called Biden 'the only Democratic true believer' in support of the initiative."

Ironically, Biden who spent his entire miserable, corrupt career with his head up the ass of the banking industry "took umbrage at those who depicted him as a tool of his donors. 'No one has ever accused me of being a friend of the banking industry,' he said." That was a very typical Biden lie, who, at the time (pre-Trump) was widely know as the most dishonest person in American politics.

Last night, senior Forbes contributor Adam Minsky, reported that though Biden may throw students some table scraps, he said that he's "unlikely" to cancel $50,000 in student loan debt by executive order. Get used to it: Biden will be the second worst president of our lifetimes, the worst if you still insist Trump wasn't a real president, just a Russian plant.

Biden will grudgingly support $10,000 in student loan forgiveness. He claimed he doesn't have the executive power to cancel $50,000 in federal student debt, but he's back to lying his ass off again, something we're all going to have to get used to.

A diverse coalition of 237 civil rights and consumer protection organizations, including the NAACP and several national labor unions, sent a letter to Biden in November, urging him to use executive authority to cancel federal student debt when he assumes office in January.

“President-Elect Biden can-- and should-- cancel student debt on Day One of his presidency,” said Ashley Harrington, federal advocacy director and senior counsel at the Center for Responsible Lending, at the time.

The organizations, and several Democrats in Congress, have argued that the Higher Education Act provides the President with broad authority release borrowers from their student loans. Some student loan legal experts have argued that using this provision to cancel student loan debt is legally sound. But others have expressed concern that such executive action could face serious legal challenges as an overreach of executive authority.

Marie Newman, who defeated reactionary Blue Dog Dan Lipinksi and went on to win a Chicagoland congressional district, hasn't been sworn in yet but is already proving herself to be all we hoped we'd find in a strong pro-working class progressive. "We cannot wait any longer for student debt relief," she told me this morning. "This should be considered part of survival and relief packages. So frustrating the incoming administration is not likely to entertain this in the early days!" Today we added Marie to the tiny Blue America list of indispensable incumbents, the first of the 2020 class to make the list.