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Debt Is Holding Black Americans Hostage

To break free, we need an honest conversation about reparations and forgiveness on a mass scale.

By Edna BonhommeTwitter

November 7, 2019

Graduates of Howard University stand for the school anthem during the 2014 commencement ceremony. The average student loan debt of black Americans is $7,400 more than their peers—and that amount can triple years after graduation.(Reuters / Jonathan Ernst)

The average student loan debt is $37,102; mine is $120,000. In 2002, I couldn’t wait to start college, and student loans—as well as work-study and the Federal Pell Grant—were part of the deal. I was elated to have a sense of independence and newfound freedom: a signal that I would be achieving an American dream. And while the dollar amount might appear excessive, it is by no means an anomaly for black Americans like me.

During my four years at a small liberal arts college in the Pacific Northwest, I borrowed a total of $16,000. This debt was minor compared to what I accrued when I began my master’s degree in 2008. When I was offered a financial aid package for my public health studies, it totaled $70,000, to be distributed over the course of two years.

A decade later, my signature on that dotted line still plagues me. The student loan debt of black Americans is $7,400 more than that of our white peers, and that amount can triple years after graduation—mostly because of accrued interest, but also as the result of pervasive inequalities that increase throughout one’s life.

Women are particularly burdened by college debt: They hold nearly two-thirds of America’s $1.46 trillion in student loans. So, unsurprisingly, are people of color. In “Deeper in Debt,” the American Association of University Women found that black women have the most outstanding debt compared to white men and white women, with black women racking up $29,501 in undergraduate loans by graduation, compared to $20,210 for white women. The pay gap between black women and other groups worsens their ability to pay off the debt. In many cases, African Americans make little to no progress on paying off their student loans.

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In a 2016 Consumer Reports video, a graduate named Jessie Suren remarked, “Debt is the first thing I factor in all of my decisions.” Suren’s personal account dovetailed with Ryann Liebenthal’s portrait of student loan survivors in Mother Jones. What Liebenthal highlights is the evolving privatization and mismanagement of student-loan management groups. The result: People were debilitated by their debt, taking 21 years on average to pay off their loans. And because black women make 61 cents for every dollar compared to their white male counterparts, it takes them longer to pay off the same amount of debt.

Beyond student loans, the broader statistics on black debt in America are arresting.

With a median net worth of $16,600 (compared to a net worth of $162,000 for their white counterparts) and $6,172 in credit card debt, the financial odds are stacked against black American families. Single black women aged 36–49, on average, have a net worth of $5, while single white women in the same age group have a net worth of nearly $42,000. The statistic is calculated from median income, assets, and accumulated debt—that is, money owed from credit cards to student loans. A 2016 US Federal Reserve study found that 19 percent of black households have zero or negative net worth. Beyond that, women of color are discriminated against initially during hiring practices, so their starting income tends to be lower than their white counterparts’. These material realities bleed into other aspects of life.

The scale of indebtedness seems to climb daily, but it’s far from a new phenomenon: The roots of the problem can be traced to 1619, the year the first enslaved Africans touched the English colony of Virginia. Debt was a crucial consequence of slavery: The profits from the transatlantic slave trade, as Eric Williams argues in his seminal text Capitalism & Slavery, allowed Europe and the United States to accumulate wealth, while slaves and their descendants were denied the fruits of their labor. This siphoning of wealth from black labor is part of how my family’s debt began: My ancestors were forcibly brought to Saint Domingue (present-day Haiti), leaving them dispossessed from the wealth they earned for the French state, and in the case of Haiti, the newly independent black republic agreed to pay France $21 billion in 1825 to maintain its freedom.

Slavery and its aftermath continue to hurt black Americans through housing segregation, adding to the debt they accumulate simply to stay alive. The 2019 US County Health Rankings shows that nearly a quarter of black families (compared to about one in 10 white families) spend more than half of their income on housing. The unevenness in housing-related costs means that black Americans paying off debt can save even less. What is more egregious is that usurious or excessive interest rates can turn a $1,000 loan into being $40,000 in the red. This undue burden trickles down to declining health and food insecurity, especially among children. Theses realities and centuries of broken promises helped sparked a national conversation for why housing inequality can contribute to a case for reparations.

When the working class is drowning in loans, their bodies absorb the pain, which reverberates whenever one has to make a decision between paying rent or a phone bill. This is well-documented; in a 2018 study, researchers found that young Americans with student loan and credit card debt were (perhaps unsurprisingly) more likely to be psychologically distressed. In another study, researchers found that household debt contributed to higher blood pressure and obesity. Concomitant with these health outcomes are more severe mental health consequences, including suicidal ideation. Beyond that, debt causes the indebted person to be an automaton, perennially working to pay off the usury.

And yet not all debt is debilitating; that, too, is a function of race and class. For the upper class, debt generates wealth. The borrowed wealth of the rich and famous is unashamedly displayed with their yachts and multiple homes around the world; the 45th US president is estimated to have a personal debt of at least $315 million. What this demonstrates is that the debt of the elite—whether they pay it back in a timely fashion or not—is not stigmatized, because they can exploit a system designed for them.

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Over the past decade, the government has responded to the student loan crisis. The US Department of Education’s Income Based Repayment Expansion—which allowed payments to be capped at 10 percent of a person’s discretionary income—was one remedy. Popularly known as Revised Pay as You Earn, or REPAYE, the program is meant to help 5 million newly eligible borrowers with their student loans.

Another option is to live abroad. As a resident in Germany making less than 100,000 euros, my income-based repayment for Navient (formerly Sallie Mae) and Great Lakes Education is $0. Expatriating has provided me with more financial relief from my student loan than if I were to live in the United States. I am, in other words, a debt exile.

What do we need to end black debt? An honest discussion about reparations—and forgiveness on a mass scale. At a moment when ordinary Americans of various socioeconomic and ethnic backgrounds struggle to pay back student loans, mortgages, and health bills, eliminating debt needs to be central to US domestic policy if the next generation is to thrive. What the protests in Chile, Ecuador, Haiti, and Lebanon have shown is that individual and collective debt requires people to put their bodies on the line. It’s only a matter of time until Americans realize that there’s a vise around their neck as well—and that protesting to demand change is the only way to break free.

Edna BonhommeTwitterEdna Bonhomme is a historian of science and writer based in Berlin, Germany. Her work has appeared in Al Jazeera, The Atlantic, The Guardian, the London Review of Books, and elsewhere.


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