by John Chubb
Everyone agrees that America’s high schools need to do a better job of preparing students to be “college- and career-ready.” But the big problem is, how do we get them to do that?
One state has just come up with a bold solution – and it could serve as a model for education reform throughout the entire country.
California recently passed a law that reduces the weight of standardized test scores for ranking high schools. Now, crucial factors like graduation rates, attendance and student advancement will play a larger role in grading the ability of public schools in preparing students to succeed after high school
This law is a big step in the right direction — and it paves the way for other states to pass similar reforms aimed at preparing students for college and beyond.
Why the change? Since 1999, every California public school has been granted an Academic Performance Index, or API, score based almost entirely on how its students fare on a handful of standardized tests. Other states are also similarly reliant upon test scores to evaluate their schools’ successes.
These scores help determine everything about a school’s future — whether it receives funding, whether parents can move their children to a better school, even whether home values rise or fall. So the pressure to get a high score is enormous.
The intention, of course, has been to hold schools accountable for their performance and to give them incentives to improve. The problem is that the system puts too much emphasis on tests that don’t necessarily predict how well a student will actually do after high school. In the end, students were being prepared to succeed on tests while they were in school, not to succeed beyond graduation.
Sure enough, a closer look at the numbers reveals that, when based primarily on these tests, a school’s API score can be an unreliable predictor of how well its students will perform in college. A 2012 study conducted by Education Sector found that one school with the relatively high API score of 778 out of 1,000 had a 91 percent graduation rate but sent just 66 percent of its students to college. Meanwhile, a school with a score of just 698 had a graduation rate of 95 percent and sent 86 percent of its students to college.
The API’s true shortcoming is revealed when the scores are applied to schools with a high proportion of low-income students. According to our study, three of the five high-poverty schools with the lowest API scores were among the top five overall in sending their graduates to college. And the school with the lowest API score had the highest postsecondary enrollment rate: 79 percent of its graduates in 2009 went on to a postsecondary institution, 5 percentage points above the state average.
Standardized test scores certainly provide one valid measure of student success. But it is clear that they are not entirely accurate in measuring whether students are really ready for life after high school.
And this problem has serious real-world consequences. Only 25 percent of high school students taking common college entrance exams in California are deemed college- and career-ready. And two out of every five college students must take remedial classes for basic skills before they can qualify for credit-bearing work. Our nation’s high schools have been failing to provide the requisite tools for students before sending them out the door.
The new law does much to fix how California ranks its schools. It ensures that, as of 2016, test scores can count for no more than 60 percent of a school’s API score, and it says that the state superintendent must add graduation rates and measures of college- and career-preparedness to the mix.
The reality of today’s economy is that students must start preparing for life beyond high school from the moment they enter a freshman classroom. It’s our job to make sure that our high schools are helping them do just that.
If we want America’s students to arrive at college ready for postsecondary work, then we must improve our country’s systems for evaluating high schools. California just put forward a great model for reform. What we need now is for the rest of the country to follow.
John Chubb is CEO of Education Sector, an independent think tank, and is a visiting fellow at the Hoover Institution at Stanford University.
Partnership provides urban teens with greater access to a college education
In an effort to provide underprivileged youths with access to educational opportunities, leadership training and mentoring, BMO Harris Bank has committed to a five-year, $600,000 partnership with Boys & Girls Clubs of Greater Milwaukee and Marquette University. This strategic partnership will provide the target population with greater access to higher education along with the necessary support to help students reach college graduation.
“Education is one of the cornerstones in how we help our communities, and this partnership will help ensure that more students get into college,” said Kara Kaiser, Regional President, BMO Harris Bank. “We want to make the dream of a college education a reality for more of our youth because there is so much untapped potential that we need to lead us forward.”
“We are thrilled that more young people in the community will have the opportunity to pursue their dreams of earning a college degree,” said Vincent Lyles, president & CEO of Boys & Girls Clubs of Greater Milwaukee. “We showed BMO Harris Bank what the Clubs and Marquette University have been able to do for young people who want to continue their education and work toward a brighter future, and they saw the value in helping us take our efforts to the next level.”
“Thanks to the support of BMO Harris, Marquette can continue to make a difference in the lives of young men and women from Boys & Girls Clubs of Greater Milwaukee,” said Marquette University President Scott R. Pilarz, S.J. “This work is at the heart of our mission, and we’re proud of the impact our students go on to have in our world.”
Half of BMO Harris Bank’s donation will help expand Boys & Girls Clubs’ Graduation Plus program, which works with high school students to make college accessible and graduation imminent. Staff members teach students about the college application and enrollment processes, provide ACT preparation workshops, take students on college tours and help with college course selection. In addition, the Clubs provide employment to students who need to save for college, and then it matches their savings to help finance their education. Once in college, Graduation Plus participants have the added benefit of support staff who help them work through any barriers to graduation. The first class of Graduation Plus participants graduated from college earlier this year – some of them from Marquette.
The other half of BMO Harris Bank’s donation will provide increased scholarship opportunities to Boys & Girls Clubs’ Graduation Plus members who go on to attend Marquette. Currently, there are eight Graduation Plus participants enrolled at Marquette, several of them on full scholarship as Marquette University Urban Scholars. Boys & Girls Clubs and Marquette have worked together for years with the common goal of helping members of the urban community, many of them first-generation college students, realize their dream of college graduation. By sharing resources and collaborating on training and mentoring opportunities, the Clubs and Marquette have created a fluid transition for students from high school to college, all the way through graduation.
BMO Harris Bank’s support will also create a career readiness program, which provides internships and job shadowing opportunities at BMO Harris Bank for Graduation Plus students enrolled at Marquette. In addition, BMO Harris Bank will facilitate financial literacy classes for students at Boys & Girls Clubs to help them develop good financial habits. Students who take these classes and participate in the career readiness program will be encouraged to mentor younger students when they enroll at Marquette.
Thirteen of the sixteen students who attended the 100 Black Men’s Honors Invitational attended a reception prior to their trip to Chicago. (Photo by Yvonne Kemp)
by Taki S. Raton
Sixteen seniors from Milwaukee, Kenosha, Beloit and Madison school districts were listed among the more than 200 students attending the Sixth Annual Honors Students (HSR) at the University of Illinois’ Chicago Circle UIC Forum.
Sponsored by the 100 Black Men Chicago Chapter, the invitational HSR is scheduled yearly on the second Friday in October in conjunction with their public Annual College Fair held the following day.
In association with the 100 Black Men Milwaukee Chapter, this is the fourth year since 2009 that Milwaukee has been granted the opportunity to participate in this exclusive senior event and the third consecutive year since 2010 that invitations were shared with select Wisconsin school districts.
High schools represented this year in Milwaukee include, Messmer, Marquette University High School, Riverside, Rufus King, Milwaukee School of Languages, Milwaukee High School of the Arts, Divine Savior Holy Angels and Nicolet High School in Glendale, Wisconsin. Students were additionally selected from Bradford High School in Kenosha, Beloit Memorial High School in Beloit, Wisconsin and from Madison West High School in Madison.
Students in attendance were able to interact with college and university representatives from around the country, many of whom were of Ivy League status. The purpose of this gathering was to inspire dialogue exploring admissions and scholarship prospects.
Campus representatives were well aware that on this Friday’s invitational, they were interacting with top-of-the line potential applicants.
A sampling of the colleges and universities represented included Morehouse College, Notre Dame University, Carleton College, Illinois Institute of Technology, Princeton University, Notre Dame University, University of Minnesota, Wellesley College, US Air Force Academy, University of Michigan, Colorado College, Yale University, DePaul University, Eastern Michigan University, Howard University, Dartmouth College, Harvard College, Knox College, Purdue University, Brown University, and Northern Illinois University.
“This event gave me the chance to actually meet and speak with representatives from colleges that I had only seen and heard about online,” said Beverly Alomepe, a senior at Milwaukee School of Languages.
“It also gave me a chance to ask questions that I have always wanted to ask about specific campuses. Overall, it was an awakening experience and I am very glad I attended,” she adds.
Beloit’s Samantha DeForest-Davis noted that “This was a great opportunity to see what is out there. It opened my eyes to colleges to which I had never thought of applying. And it was wonderful seeing other students like myself who are serious about their future and trying to better themselves and their communities.”
Bradford High School’s Colin Barushok said that he was “very impressed with the caliber of students who were present and it was indeed an honor to be invited.”
Nine parent chaperons accompanied the students to Chicago. James Harris, father of Divine Savior Holy Angels senior Morgan Harris recalls that “I found this event sponsored by the 100 Black Men of Chicago to be quite enlightening for our young leaders of tomorrow.”
He adds that “not only was the evening very well organized, but the college representatives were extremely knowledgeable and helpful with information on their respective campuses and they took the time to answer questions and provide guidance on admissions and scholarship details.
“I would recommend the Honors Student Reception to any parent with high achieving college bound students.”
Beverly’s father, Evan Alomepe said of the HSR that, “It has been an eye-opening experience for both my daughter and myself. It was very helpful to talk to college representatives and examine their brochures. Also, networking with other parents present with their seniors was very inspiring.”
Beverly Resch, mother of Madison West senior Isaiah Scott thought that the HSR was, “A great opportunity for students and exposed them to many colleges and universities that they were probably not aware of prior to attending this event. The food was also delicious!”
100 Black Men of Chicago Board Chair Craig Gilmore said of the event that the area’s “most prepared high school seniors shared their Friday evening meeting with representatives from 35 nationally prominent colleges and universities discussing their college aspirations.”
He adds that, “given all that we hear about our young people and their lack of direction and the apathy of parents, it was gratifying to see both parents and students engaged in life-altering conversations. Proof positive, that when provided a choice, our young people will choose educational opportunities.”
In association with the 100 Black Men Milwaukee Chapter, a meet-and-greet send-off gathering was held at the Wisconsin African American Women’s Center (WAAWC), 3020 West Vliet for the area students and parents before boarding the carpeted coach bus provided by Providence Baptist Church.
College Access Center – North director Charnessa Dunlap-Parker, Springfield College Professor Dr. Warren Braden and WAAWC co-founder Josephine Hill were invited to provide congratulatory remarks to the guest.
As of 2011, a total of 75 students from Milwaukee, Kenosha, Beloit, and Madison who have met the 3.3 GPA minimum and 23 cum or above on the ACT have been identified and invited to the HSR.
Pilgrim Rest Missionary Baptist Church will present a College Fair on Saturday, October 13 from 11:00 to 3:00 p.m. The College Fair is a ministry outreach of The College Ministry and Youth Department of Pilgrim Rest and will be held in the fellowship hall of the church, 3737 N. Sherman Blvd., Milwaukee. The College Fair is tailored for young people from middle school through high school who are thinking about attending college and are interested in finding out more about the different things involved in getting into college and succeeding in college.
There will be sessions where you can talk to representatives from different colleges and universities and college graduates and current college students share their insights and wisdom about what you should know. There will also be break-out sessions on topics such as maintaining your faith in college, deciding which college or university to attend, financial aid and scholarships, writing the application essay, taking the ACT/SAT, TRIO programs and precollege programs such as Upward Bound. This inside information should help you in providing an edge in the competitive process.
This event is free and open to the public. For more information, an application is available at the Pilgrim Rest website under events at http://pilgrimrest.homestead.com or call Linda Kincaid at (414) 305-0032, Arrila Eversley at (414) 292-5158, or Frank Wilson at (414) 464-5296.
Schools will develop innovative ways to improve student achievement that others can follow
Ten Milwaukee Public Schools elementary schools are set to become models for putting students on track to career and college readiness as new GE Foundation Demonstration Schools, the district and foundation announced Monday.
The schools will develop innovative ways to put the rigorous Common Core State Standards into practice. The Common Core State Standards define what students learn at each grade — and research has shown the standards will help make U.S. students competitive with counterparts around the world.
Forty-two eligible schools were invited to apply for the chance to be named an MPS GE Foundation Demonstration School. The teaching staff at all applying schools participated in the development of the application and the Milwaukee Teacher’s Education Association (MTEA) has been a strong partner in development of the Demonstration Schools.
The schools feature a mix of standards and practices focused on high levels of success and achievement:
– Rigorous instruction through the Common Core
– A true learning community in which teachers have the opportunity to collaborate during the school day to develop best practices for increasing student achievement
– A collaborative culture in which educators work together with students and parents to understand the needs of all learners
– Partnerships with businesses and community organizations that expand opportunities for students and ensure that they are prepared for college and career success.
Milwaukee Public Schools’ Comprehensive Literacy Plan and Comprehensive Math/Science Plan are aligned to the Common Core and the district has utilized portions of a five-year, $20.4-million GE Foundation grant to develop the Math/Science Plan and to help support or fund more than 80,000 hours of training for thousands of teachers.
A portion of the GE grant dollars will now be used to provide additional support to the 10 GE Foundation Demonstration Schools, including the creation of common planning time for teachers to work together to move students forward. New teaching positions have also been created for the schools, aimed at making relevant connections between curriculum and students’ lives.
As the schools develop innovative and successful strategies, other schools from across MPS — and perhaps across the nation — will be invited to visit the school and adapt the strategies to their own classrooms.
The GE Demonstration Schools project reflects the Milwaukee Board of School Directors continued efforts to build ways in which the district uses a combination of innovative efforts and proven best practices to push forward efforts to engage broad sectors of the community to support student learning.
The announcement of the project comes as MPS and schools across the state are holding themselves to new, higher definitions of success in the soon-to-be-released Wisconsin Department of Public Instruction school report cards. The new school report cards will reveal that schools across the state have more work to do to fully prepare students for college and careers.
“We must raise the bar to measure progress toward college and career readiness. Our students and families deserve it,” MPS Superintendent Gregory Thornton said. “And we know that the Common Core State Standards are the way to get there. We’ve been putting them into place since 2010 — and now, thanks to the GE Foundation, we’re developing models that will show all of our schools the very best ways to use the Common Core to raise student achievement.”
“Research shows that the Common Core State Standards are the way to make sure students in the U.S. are competitive with their peers around the world. We are honored to work with Milwaukee Public Schools to develop models of how to put the Common Core into practice,” said Kelli Wells, program director for U.S. Education at the GE Foundation.
The 10 schools being named Monday are: Browning School, Clemens School, Curtin School, 53rd Street School, Fratney School, Kagel School, Milwaukee Sign Language School, 95th Street School, Pierce Street School and Victory School for the Gifted and Talented.
“The staff in these schools has the chance to be on the cutting edge of developing opportunities to advance teacher collaboration and improve student learning,” stated MTEA president Bob Peterson. “I am confident this effort will play a critical role linking educators, parents and students in meaningful ways that
Young African American college graduates say they are much more serious about reaching financial goals than previous generations, according to new Northwestern Mutual research.
A large majority (70 percent) of 18-to-34-year-old African American college graduates described themselves as either “disciplined” or “highly disciplined” financial planners, compared to only 47 percent of those aged 35 and older. However, mature African American college graduates (55 and older) were far more likely than those aged 18-to-34 to report having plans in place to prepare them financially to live to age 95 (40 percent vs. 9 percent, respectively). Overall, four in 10 African American college graduates (41 percent) felt financially prepared to live to age 75 while about one in four (27 percent) were prepared to live to age 95.
“It’s encouraging to see young African American college grads feeling confident in their ability to commit to long-term financial plans,” said William Taylor, vice president, Northwestern Mutual. “The study shows brighter financial futures for the next generation of African Americans if that passion for planning can be coupled with careful plan design, enabling young people to get not just to, but through retirement. The good news for all – no matter their age, gender or race – is that it’s never too late to take that first small step and start planning for the long-term.”
When asked about having a plan in place for various aspects of their lives, there was clear contrast in values between genders. Male African American college graduates (52 percent) were more likely to have a financial plan in place to meet their financial goals than women (35 percent). Instead, more women graduates reported having plans in place to meet their spiritual, physical fitness and family life goals. As a whole, 58 percent had a plan in place for their spiritual life compared to 43 percent having a plan in place for their financial life.
The most popular attitude of African American college graduates toward financial planning is that of “slow and steady wins the race,” or a cautiously optimistic approach to their saving and investments (31 percent).
Northwestern Mutual is unveiling the research findings at the National Black MBA Association, Inc.’s (NBMBAA) 34th Annual Conference & Exposition in Indianapolis, Ind., a five-day event intended to further the creation of educational opportunities and economic growth for African Americans.
Northwestern Mutual partnered with Independent research firm Ipsos to conduct an online survey of 250 African American college graduates aged 25 or older between June 5 and June 11, 2012 via a systematic random sample to evaluate the state of financial planning among educated African Americans. Results were weighted as needed to U.S. Census proportions for age, gender, marital status, household size, region and household income. A full methodology is available on request.
Competition for college admission isn’t the only thing that’s heating up university campuses these days-acceptance into social sororities has reached a new level of importance. In order to get through “rush”-the week-long acceptance process for sororities nationwide-many parents have begun hiring recruitment counselors or image consultants to help guide their daughters through the process.
In Birmingham, Alabama, high school women looking to find out more about Greek life can go to Rushbiddies, a consultancy founded in 2009 by Pat Grant and Marlea Foster. Rushbiddies charges $25 per hour for one-on-one time, or $200 for a 2-day workshop.
“At first glance, this may come off as very frivolous, but for many young women, rush is an important rite of passage,” says Grant. “A lot of schools in the South have gotten very big, and joining a sorority is a wonderful way to find a small group of friends and navigate being away from home for the first time.”
Grant says that the average Rushbiddies client is a mother without a Greek background who has a daughter who wants to go through rush. On occasion, Grant says that a mother will sign up her daughter-but the daughter doesn’t want to attend. In that case, moms are welcome to attend solo and impart what they learn to their daughters at a later date. Other times, young women sign themselves up for a workshop where they can network with other prospective Greek women.
As for the increased interest in rush consultants, Grant says that people are “catching on” that sororities are a “wonderful place to plug in on campus,” and parents see the importance in prepping their daughters with interview and presentation skills before sending them off to college.
“For many young women, this is the first time they’re learning networking skills,” says Grant. “We help them write a professional resume, we encourage them to get involved in their community, and we give them conversation skills. Some of them don’t know that good small talk does not include old boyfriends.”
The 24-year-old grad student earned $6,500 for her first egg donation, which almost covers her entire first year of school. A couple more egg donations will leave her with enough money to pay the full cost of the program — around $15,000.
“When I worked a second job [between college and graduate school], it took me almost a year working in retail to make this same amount I’ve already made from one egg donation,” she said.
One 21-year-old student said she receives a monthly allowance from a 37-year-old “sugar daddy” she met through online dating site SeekingArrangement.com, which helps rich men find young women who are looking to be supported financially. In exchange for her company, she says her sugar daddy has been making her full tuition payments of $1,500 each month.
According to SeekingArrangement, that allowance is low compared to what most college students on the site receive. About 41%, or 350,000, of the sugar babies on SeekingArrangement.com are college students, and two-thirds of them say they are using their sugar daddy as a primary or secondary means of paying for college — receiving an average of $4,200 a month for college expenses, according to the company.
South side location opens; all seniors served at existing north site accepted to college
On the heels of the success of its first TEAM UP College Access Center on the city’s north side, Milwaukee Public Schools is set to celebrated recently the opening of its second College Access Center, this one along highly-visible South 27th Street in the Southgate Marketplace, 3333 S. 27thStreet.
The centers, which are open on evenings and weekends, help demystify the process of learning about and applying to college thanks to the highly-qualified counselors, teachers and advisors on staff.
MPS’ TEAM UP College Access Centers are open to all Milwaukee students, regardless of which school or school system they attend. The counselors, teachers and advisors offer small-group and individual workshops that help students under stand the coursework they’ll need for college, prepare to take the ACT, select/apply for colleges and understand/apply for critical financial aid resources and other supports.
Every single senior who has been served at the existing north side center was accepted into at least one college. Both centers are funded by a grant from the Great Lakes Higher Education Guaranty Corporation.
“So many of our students are poised to become the first members of their family to attend college,” MPS Superintendent Gregory Thornton said. “That makes this service all the more critical. Thanks to our partners at Great Lakes, we’re giving students and their families a place to come together to prepare for the future.”
“We consider our funding of the centers to be an investment in the students of Milwaukee,” said Amy Kerwin, Chief Educational Opportunities Officer at Great Lakes. “Through this partnership with MPS, more students will receive the support they need to prepare for and succeed in college: personal help in choosing the right classes now, determining the type of school and program to pursue for each student’s interests and abilities, preparing for standardized tests, completing college applications, and applying for financial aid to meet rising college costs. Ultimately, the centers provide another avenue to connect more Milwaukee residents to higher education’s undeniable benefits.”
Between the time the existing north-side center opened in October 2011 and July 2012, 545 students were served, including 180 seniors. Every one of the 180 seniors completed at least one college application and began the process of applying for financial aid. And every one of the 180 seniors was accepted into at least one college.
Nearly half – 44% – of the seniors used the center to assist in scholarship applications. The center delivered more than 1,300 hours of one-on-one college advisement through roughly 1,100 visits.
The south side opening comes at a time when Milwaukee Public Schools continues to implement a college- and career-ready curriculum, based upon the Comprehensive Literacy Plan and Comprehensive Mathematics/Science Plan, to close the gaps students face upon graduation. And this effort comes as MPS has seen its legacy graduation rate rise from 52% for the class of 2000 to 69% for the class of 2011, the most recent year available.
During the school year, both centers are open Monday-Friday from 2 p.m. to 7 p.m., Saturday from 9 a.m. to 2 p.m. and Sunday from 12 p.m. to 4 p.m. The centers close on major holidays. During the summer, winter and spring breaks, they are open Monday-Friday 9 a.m. to 4 p.m. and closed on weekends. The College Access Center – North is located at 2730 W. Fond du Lac Avenue, Milwaukee 53210.
by Kay Steiger
Once again, student-loan season is upon us. As a new class of freshmen ships off for a hopeful first year of college or trade school, many are as busy figuring out financial arrangements as lining up classes. It wasn’t always this way, but as education has become both more costly and more necessary, many students feel they don’t have any other choice. And so they borrow $10,000, $25,000, as much as $100,000, often unaware of the unforgiving nature of the debt they’re taking on.
This year, as these students prepare to sign away their futures, they would do well to consider a report released by the Consumer Financial Protection Bureau (CFPB). On July 20, the agency designed by Massachusetts Senate candidate Elizabeth Warren released “Private Student Loans,” a devastating expose of the $150 billion private student loan industry, one of the banking world’s Goliaths. The report is both an official account of private lenders’ underhanded “subprime-style” tactics as well as a sharp warning against taking out private loans that put students at risk of financial ruin.
As described in the report, the student-loan industry is a villainous enterprise, set on scamming some of the country’s most eager and vulnerable citizens. Anchored by lending giants like Sallie Mae and bolstered by some for-profit colleges that lend to their own students, it bears all the hallmarks of some of the last decade’s other most predatory industries. Much like the mortgage industry, it used cheap-credit tactics to prey on low-information borrowers, typically students of color, effectively quadrupling in size between 2001 and 2008. And like the mortgage industry, it collapsed in the recession, leaving many students drowning in debt. Today, more than $8.1 billion worth of private student loans are in default.
Here’s one way the industry goes about its business: though private student loans typically come to students through a menu of lending options from a college or university’s financial aid office, along with federal options like Pell grants and subsidized Stafford loans, the CFPB report explains that many of these loans are offered directly to students without input from a financial aid office. This tactic, called “direct to consumer” lending, results in “significant over-borrowing.” This is problematic because “over-borrowing increases the likelihood of default, to the detriment of both borrower and lender.”
And the scam gets worse. Though an estimated two-thirds of private student-loan borrowers don’t understand the difference between private and federal loans, there is at least one critical difference: Private student loans lack key protections that come with federal student loans — most notably, a variety of options for delaying or reducing payments if students encounter economic hardship.
“That confusion has been deliberate,” said Lauren Asher, president of the Institute for College Access and Success. “People get stuck with these loans, often without clear information.”
The worst part of private student loans is that when students have run out of all other options and need to declare bankruptcy, they can’t. (The one exception to this rule is when students can prove an “undue hardship,” but this standard is nearly impossible to meet, and an analysis by a bankruptcy lawyer organization found that those who qualify are “very close to the poverty level with little or no hope for improvement.”)
Consider the case of Fred, a student whose story was highlighted by Jennifer Mishory, the deputy director of the youth advocacy group Young Invincibles, in her testimony before the Senate Banking Subcommittee on Financial Institutions and Consumer Protection in late July (the hearing took place just after the CFPB report was released). Fred was a victim of a violent crime in which he sustained “injuries to his face and head.” Because he was uninsured, he quickly found himself buried by medical expenses and ended up having to declare bankruptcy. While bankruptcy helped Fred clear his medical debts, under the perverse terms of bankruptcy law, he couldn’t get any reprieve from his student loans. Fred left the bankruptcy proceedings with $51,000 in student debt.
Strangely, had Fred filed for bankruptcy before 2005, he wouldn’t have this problem. A little-noticed change to bankruptcy law that year put private student loans into the category of non-dischargeable debt, or debt that can’t be cleared away through bankruptcy. The CFPB report says that this type of debt includes “child support payments, alimony, debts related to tax liens, claims arising out of wrongful conduct (like a judgment against a drunk driver), and both federal and private student loans.”
And yet, it’s not entirely clear why or how private student loans came to be included in this category of debt. While all the other forms of bankruptcy-proof debt are either “owed to the public or the creditor lacks discretion over entering into the debtor-creditor relationship (or both),” private loans don’t fit either requirement, according to the CFPB report. Moreover, the actual number of student bankruptcies is relatively small, and a 1997 review found no evidence of systemic abuse in student-loan bankruptcy claims.
So how did private loans come to be shoehorned in with all the other forms of non-dischargeable debt?
The CFPB report notes that the Congressional record has little to offer “regarding the rationale for treating private student loans similarly to federal student loans and differently from general consumer loans.” What we do know is that the change came along with a laundry list of other changes to bankruptcy law, and that Sallie Mae, the biggest private lender, spent over $1.4 million on lobbying that year. That number has dramatically increased, with the company spending between $3 million and $4 million a year from 2007 to 2011.
Still, there is a faint glimmer of hope. Two bills seek to reverse the 2005 bankruptcy-law change: Illinois Senator Dick Durbin’s Fairness for Struggling Students Act and Tennessee Congressman Steve Cohen’s Private Student Loan Bankruptcy Fairness Act. Both bills would push private student loans back into the category of debt that is dischargeable in bankruptcy, though it’s also worth mentioning that Cohen’s bill would help only students applying for new loans.
Reversing the 2005 change “could potentially be a really big deal for people who are struggling,” Mishory said.
Remarkably, Sallie Mae, which engaged in highly predatory practices throughout the last decade, has endorsed this change. But the truth is that both bills still have a long distance to travel before they become law. As much as they could offer real relief to those new students who are about to sign on the dotted line to pay for their degrees, it’s unlikely that Congress will make this a priority, given that it can’t even get its annual budgeting bills off the ground.
Where does that leave incoming college students? For one thing, they would do well to make the CFPB report their first reading assignment. At the very least, they should think of private student loans as a last resort.
Kay Steiger is the managing editor of Raw Story. She previously worked at Washingtonian Magazine, Campus Progress and The American Prospect. Her work has appeared in The Atlantic, the Guardian, Jezebel, RH Reality Check, In These Times, AlterNet, Religion Dispatches and Bitch magazine.