Berea College, Work Colleges, Tax Bills, and Student Loan Ripoffs

Gulfport   Berea College is as close as something comes to a one-of-a-kind, single institution, social change education experiment. Founded 162 years ago by abolitionists in Kentucky to educate freed slaves and lower income white students, to this day the college only admits lower income students. The Times reports that 98% of its classes use federal Pell grants and 64% are first time college students. Amazingly, all four years of college are tuition free for the students. Why don’t we have more college like this!

I’ve followed Berea at a distance with admiration. A former ACORN organizer in New Orleans moved to Berea when he fell for a local woman from there and always spoke of the town and the school with awe. Not being a college guy, I had looked them up back when and wondered why we didn’t recruit organizers there, and why they weren’t trying to get us to take summer interns, provide work study, and teach classes.

All of which surprised me to see Berea in the papers in an article connected to the Republican’s tax bill. Turned out Kentucky’s Senator and Majority Leader Mitch McConnell tried to put in a last minute carveout for Berea that would exempt them from paying the additional tax the bill had put on college endowments valued at over $500,000 per student. The target was the Ivy League schools and other big hitters like Stanford and the like. Turns out little Berea’s big, billion dollar plus endowment puts them at $700,000 per pupil. Anyway, Democrats like Bernie Sanders put a red flag on the item as not being budget related and breaking the rules. Now, Berea is in the middle of a partisan squabble as McConnell tries to put the horns on Sanders, and Sanders retorts that McConnell and the Repubs ought to support his bill making all college tuition free.

Somehow you know Berea is going to get a fix, but in the PT Barnum sense that “any publicity is good publicity,” let’s make the most of their moment in the sun, or storm, or whatever you want to call it. One thing that’s getting some more light as the sparks fly is that Berea is one of seven so-called “work colleges,” which is also interesting. The concept there is that students pledge to study and work throughout their time, arguably making them good-to-go for job skills and discipline when they matriculate, but also helping pay the bills in an equitable fashion without much, if any, student loan debt. Looking at the list of other schools, it’s a hill country kind of phenomena it seems with schools in North Carolina, Kentucky, southern Illinois and southern Missouri and Arkansas, including the College of the Ozarks.

Better to look at these brave few schools than the ones the Republicans really seem to love which are the for-profit college. Secretary of Education and for-profit college investor, Betty DeVos says that she is about to release her plan to renege on canceling the loan debt for students who were ripped off by the for-profit scamsters who made claims that they couldn’t deliver. Obama’s people were going to cancel out 100% of the debt, sticking it to the fraudulent institutions. DeVos wants a formula that exempts students who are making 50% less than others, but makes those making 50% or more of other graduates in their cohort to have to pay some share of the loans.

Let me get this straight. Republicans are claiming they love Berea which is about work, and Republicans also want to penalize students coming from ripoff schools who have taken the lemons, made lemonade, and are working.

Does this add up? You figure?!?

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DeVos and Education Department Cannot Renege on Student Loans

New Orleans   Millions owe billions in student loans and in some cases it’s a just-past-the-cradle to the grave debt that just lingers on.

In a good move and through a bipartisan vote under the George W. Bush Administration in 2007, Congress approved a bill that under certain conditions would allow an individual forgiveness of student loan debt. The conditions were that they had to make payments for ten years and they had to work for a nonprofit organization or a unit of the government. Now we are coming up on ten years and more than a half-million former students and, arguably, committed public service individuals are hearing that the Department of Education may renege and claim, hey, gotcha, and still hold them to the debt and essentially have tricked them as hostages to their program for a decade. How can that be possible? How can they get away with that?

It’s a complicated process, which probably doesn’t surprise anyone to hear. Worse, it appears that nothing about the process is transparent, including the reasons why the Department of Education approves some groups as qualifying and rejects other groups arbitrarily, though they are also nonprofits and their work seems almost identical.

Equally disturbing is that this could be a deeper setback than just the question of a student’s debt. There has long been a policy discussion about the value of national service. Since the days of the dreaded draft and the Russian roulette of the draft lottery during the Vietnam War, compulsory military service has been replaced by the all-volunteer Army. In our age of inequity that means the military in peacetime has become a lower rung on the working class job and training ladder, and during wartime which seems semi-permanent since 9/11 has become a high risk option for anyone other than the patriotic or the desperate.

Nonetheless, presidents from Clinton to Obama have argued that there was real merit to increased national service, which was part and parcel to this provision of debt forgiveness for younger Americans that were willing to pass up bigger money and softer cushions to work for the government and in public service, including as firefighters, police, teachers and other critical positions in both cities and rural communities. Nonprofits fit into this same dynamic, which is why they are nonprofit and why many are tax exempt because of their value to the community in service, healthcare, and other endeavors.

The President and the Secretary of Education need to do right on this and honor the country’s word to individuals who relied on the country’s promise that in exchange for ten years of payments and ten years of service, they would have the rest of their loans forgiven. This was a good, fair deal. It should not be changed, and if it is changed, it should be on this Congress, this President, and this Secretary of Education going forward, not clawing back.

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Please enjoy the Grateful Dead’s Dancing in the Dark.

Thanks to KABF.

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