Derrick Johnson, President of the NAACP
Courtesy of: NAACP
In late May, news circulated that the Biden administration was leaning toward a $10,000 per borrower student loan forgiveness plan.
NAACP officials were furious.
Association President and CEO Derrick Johnson said in a statement shortly after the news broke that a $10,000 cancellation “would be a slap in the face.”
The swift condemnation of the nation’s oldest civil rights organization was not unusual: It has made the student debt crisis one of its top issues lately and insists that President Joe Biden will fail in his promise to reduce the racial wealth gap if it doesn’t relieve more of the country’s outstanding $1.7 trillion education debt. (The typical black family in the United States had a net worth of $23,000 in 2019, compared to $184,000 for the average white family.)
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CNBC recently spoke with Johnson, 53, who has led the organization for five years now, about why the NAACP keeps talking about canceling student debt. (Editor’s note: Interview has been edited and condensed for clarity.)
Annie Nova: Why is the NAACP so focused on forgiving student loans as a way to close the racial wealth gap?
Derrick Johnson: The #1 driver of wealth in this country is home ownership, but you can’t qualify for a house if your debt-to-income ratio is too high, and the #1 debt of African Americans in this moment is the student loan. As a result, there is no way forward to closing the racial wealth gap without first substantially addressing the student loan crisis.
AN: Why are black Americans disproportionately burdened with student debt?
DJ: There has been a big increase over the past 20 years in the number of African Americans attending college, and it was around the same time that many institutions of higher education began raising their tuition fees. . States began to cut taxes and increase their costs. This is in addition to the many predatory institutions that have sprung up.
AN: Why do you think $10,000 in forgiveness isn’t enough?
DJ: It’s throwing a bucket of ice on a forest fire. All the data shows that the average debt level of African Americans is well over $10,000. Cancellation must be at least $50,000.
AN: How might canceling student loans impact black voter turnout in November’s midterm elections?
DJ: All of our research shows that one of the biggest things that energizes African American voters is the student debt crisis. And they are regular voters: teachers, school administrators, people who work in the public sector. The question is, what are you going to do for those loyal voters who turned out in record numbers in 2020 to give them the kind of inspiration to run again at those high levels?
AN: What do you predict will happen if there is no action here?
DJ: You have households where you have grandparents, children, and grandchildren all struggling with student debt. It’s a generational problem, and it’s only accelerating. It’s no different than the mortgage crisis in 2008. The only difference is that people could file for bankruptcy and walk away from home and be left harmless. With student loans, there is almost nothing you can do to relieve yourself.
AN: Did you have student loans?
DJ: Absolutely. I am first generation, undergraduate and law school. I had no other choice: there was no family member who could write the check. There was no home equity loan to exploit.