The Story of How to Remedy Student Debt!
Once upon a time, there was a group of students and former students (around 50 million) who had become fed up with having to pay back student loans. While having to pay back the loans, these students and former students often could not find any work at all. Others could find only minimal work. So they could not afford to pay back their loans, particularly when they factored in other expenses such as rent, food and utilities. Many of these people ended up having to live with their parents. They of course could not rid themselves of the debt by filing for bankruptcy.
One day Dan, a Ph.D. graduate of the University California Berkeley put a page on Facebook. It was titled: “Fixing Student Debt.” Numerous people became fans of the page. After five days the page had 10,000 followers. A week later it had 50,000 followers. Two weeks after the page started, it had over 100,000 followers.
Dan corresponded with Elizabeth, one of the first followers of the page. Elizabeth had completed her Ph.D. from the Harvard Kennedy School of Government over a year earlier. Yet she could not find any work. She owed over $100,000 in student debt. As a result, she was living with her parents. At one point she had been homeless, after being evicted from her apartment because of her inability to pay rent. Elizabeth and Dan started their own website talking about the problems of student debt and what students could do about it. They established a contact list of even more people burdened with student debt.
As citizens, Dan and Elizabeth wanted to use traditional methods of changing the student loan system. So they wrote to every member of Congress, asking for the interest rates on student loans to be lowered. They also asked for ways for people to get out of paying student debt, such as having the debt removed after successfully filing for bankruptcy.
Congress invited Dan and Elizabeth to appear before the House Banking Committee. Dan and Elizabeth talked about their problems, and the problems of numerous other students. They produced a petition with 10 million signatures that they had collected via their website and Facebook, asking Congress to reduce the interest on student debt to the level that the banks had to pay to receive loans from the federal government.
Senator Elizabeth Warren of Massachusetts had proposed similar legislation earlier. She had wanted to lower the interest rates on student loans from seven percent down to .75 percent, the same rate that the federal government charged banks. Her call was met by deaf ears in Congress. Instead, the interest on student debts had gone up to 10%. Meanwhile, the federal government continued to charge the banks the .75 percent interest.
When Dan and Elizabeth testified, most members of Congress showed a great deal of appreciation for what Dan and Elizabeth were doing. They, however, said that such a policy was not practical. Numerous members of Congress kept mentioning the national debt, saying that Uncle Sam needed the money. They dodged the issue of why banks had such a low interest rate, even though the banks had created a second financial crisis. This financial crisis had raised the unemployment rate up to ten percent again.
Dan and Elizabeth went home empty-handed. Not knowing what to do next, Dan suddenly had an epiphany. He would tell his followers not to pay their next student loan bill, and any subsequent bills until the rate was lowered. Suddenly, millions of former students were not paying their bills. As this story created media attention, more people joined the bandwagon. Twice as many people did not pay their bills the following month. Congress did not know what to do.
Then a number of the students decided to go to Washington. Dan cited the 250,000 people who attended the 1963 March on Washington to push for the passage of federal civil rights legislation. He called for his followers to double that number.
To ensure that they brought the half million protesters, Dan and Elizabeth coordinated with people all over the country to start chapters in their communities. The website created a means for every individual interested in joining the cause a way to find the contact person in their community, so that they could come together and organize their trip to Washington.
Within each community several groups would often form. They would have “Catholics for Student Debt Relief” started in communities throughout America, for instance. “Mormons for Student Debt Relief” was common in communities across Utah. There was a group called “Families for Student Debt Relief,” consisting of married people often with children who were still crushed by student debt. Then there was “Doctors for Student Debt Relief” and “Lawyers for Student Debt Relief.”
Some groups formed based on common interests. There was “Surfers for Student Debt Relief” and “Hockey Players for Student Debt Relief.” Then they had “Gays and Lesbians for Student Relief” and “Singles for Student Debt Relief.” These groups provided more incentives to become involved.
To ensure a strong turnout at these meetings, each volunteer was asked to bring in food and drink. At most meetings, alcoholic beverages were not excluded.
At these meetings, they discussed how to get to Washington and ways of funding it. Many people would ask other local organizations and businesses to donate money. Dan and Elizabeth set up a system on the main website for people to donate money towards train, bus and airfares. There was even a special fund to pay for hotels and gas for people driving. This fund allowed individuals who could not afford the traveling costs a way to reach Washington.
The various groups took further steps to increase the number of their supporters. They went door-to-door, recruiting even more people not aware of the cause.
As a result, people started arriving from all parts of the country, standing outside the Capital building. The numbers kept growing. After one week they had reached their goal, and the number kept increasing. These people included students, professors, parents and numerous other people supportive of their cause. Dan spoke for the group saying: “We will not leave until they reduce the interest rate on our loans to .75 percent, make it retroactive, and not go after us for forbearing on our loans. I want an Amnesty.” Businesses and organizations sympathetic to the cause brought in food, water, tents and blankets for the protesters. People started donating money to the website so that the protesters could buy the necessary supplies. Donations came in from all over the world. Many participants in the Arab Spring of 2011 gave money.
Technology played a huge role. The protesters photographed and videotaped their activities and carefully followed the activities of the police. Any police misconduct was immediately transmitted to the main website, along with individual Facebook and Twitter accounts. The American Civil Liberties Union and the National Lawyers Guild brought in legal observers. Jon Stewart and Stephen Colbert gave thorough attention to the protests. The 500,000 and growing population of protestors brought in attention from foreign news providers. Al Jazeera, the BBC, and ITN extensively covered the protests. To bring further attention to the matter, Dan and Elizabeth setup the website so that every time someone signed up with the course online-either directly through the website or else through a social website such Facebook-every member of Congress received an email.
To ensure that world-wide sympathy for the protesters continued, Dan and Elizabeth demanded that the protests remain peaceful. The disobedience would have to remain civil. Anyone who became violent would be immediately sent home. Protesters were to go limp when the police tried to remove them, but they would not fight even if they were physically attacked.
Washington DC police tried to disperse the demonstrators, saying the demonstrators did not have permits. They also said that the demonstrators were interfering with business in Washington, because people could not travel to where they going. There were too many protesters in the way. The police then talked about how the demonstrators interfered with the tourism industry by blocking citizens from viewing public landmarks in Washington D.C. Finally, the police said they did not have officers to protect and supervise the protesters and that it was too costly.
Two weeks after the protests had begun, the police made a major attempt to break up the protests first by randomly beating certain demonstrators then by throwing tear gas into the crowds. Protesters put on special masks to stop the tear gas. The people who were beaten refused to budge.
Initially, the president and the mayor of Washington D.C. spoke out of both sides of their mouths. They said that they sympathized with the demonstrations but said that the city needed stability. Both of these leaders talked about how the concentration of police officers on the demonstrators was creating lawlessness in the nation’s capital. After the world saw the police brutality and then the tear gas being dispersed, however, they took a different position. They said that the police needed to respect the constitutional right to protest and that Congress needed to start addressing student concerns.
In the meantime, Dan and Elizabeth took on a new approach in addition to the protests. They called on everyone to withdraw their money from all the large banks and put all their money into credit unions, unless the large banks started lobbying Congress to lower the interest rate on student loans down to what the banks paid. An immediate run from the large banks took place. Not since the Great Depression had so many people withdrawn money from large banks.
Finally, lobbyists for all the large banks appeared before Congress demanding that students pay the same interest rates as they paid.
It was essential said Shoska Tame, the CEO of one large bank. He talked about how the economy would collapse if we did not do otherwise. The large banks would not be able to provide loans and mortgages if everyone withdrew their money. Many businesses would suffer without such loans. That would dramatically increase the unemployment rate. Without mortgages people could not buy new homes. The value of existing homes would drop considerably. Someone, therefore, could not relocate, because they could not buy a new home or sell their current home. He contended that credit unions could not provide the same type of loans that larger banks could provide.
After a week of hearing testimony from both large bank lobbyists and actual CEO’s of banks, Congress lowered the interest rate on student loans to.75 percent. They made it retroactive too. Congressman Bill Tarkeney, a Republican from Oklahoma said: “There was no way to justify having students pay more in interest than the big banks. It was irrational and outrageous. I can’t believe we had such a horrific arrangement for so long.”
The night that Congress passed the Student Loan Interest Rate Reduction Act the demonstrators began gathering their belongings and started saying goodbye. Dan and Elizabeth made it clear that they would organize and return to Washington again if Congress became unfriendly to students again. There were tearful goodbyes as newly made friends parted. (Others continued in their newly formed relationships.)
Everyone felt a sense of accomplishment. Never had such a group been so instrumental in changing the law.