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Next Steps In The Fight For Debt Relief

Above photo: Washington, DC. Student debt relief activists rally at the Supreme Court on June 30, 2023. Kevin Dietsch/Getty Images.

From litigation to widespread debt strikes, Debt Collective’s plans to push back against the Supreme Court ruling.

The student loan pause offered a safety raft to millions of Americans who are drowning in debt. The Supreme Court’s recent 6-3 decision to block student debt relief will devastate these borrowers, many of whom finally experienced what it was like to have money to set aside for the chance to purchase homes, start families and live without constantly worrying about debt.

After having this taste of freedom, Americans are ready to organize to protect what the Biden administration promised them.

Among the groups leading the charge — and continuing to push the Biden administration to exercise all options for bringing about the promised debt relief — is the Debt Collective. Founded in 2014 as the nation’s first union of debtors, the Debt Collective represents tens of thousands of people with student loan debt, as well as carceral debt, credit card debt and medical debt.

Born out of Occupy Wall Street and Strike Debt, the group has abolished millions of dollars worth of debt over the last decade. Its members believe that mutual aid is crucial, but also seek to hold the government and those in power accountable, while urging them to act.

I recently spoke with Braxton Brewington, press secretary for the Debt Collective. He discussed plans to push back against the Supreme Court ruling, which include everything from litigation to widespread debt strikes.

As someone who’s become deeply involved in this work around debt collection, were you surprised by the Supreme Court’s ruling on student loans? What was your reaction?

Frustrated, but not surprised. The fact that they even took up the case was a huge indicator of where they wanted to go. We’ve already seen the Supreme Court chuck people’s rights off the cliff in previous years — and the day before with the affirmative action ruling.

I was a little surprised that there was unanimous agreement to deny the plaintiffs standing in the first lawsuit. I didn’t realize that every Supreme Court Justice would say that they didn’t have standing, but the 6-3 ruling did not catch me off guard.

With the pause set to end soon, how is the Debt Collective planning to shift its strategies? What are your specific demands?

We have a couple of demands and a couple of plans of action.

There’s just never been a more pressing time to have a rich conversation about striking your student loan debt. If the student loan payments do resume, many more people are saying, “I’m willing to not pay.” I think that’s going to shoot through the roof once people find out the policy from the Biden administration. They’re literally saying, “If you can’t afford to pay, you don’t have to.” They’re not going to report you to credit agencies. You’re not going to slip into default.

We had never encouraged anyone to default. Several of our co-founders and members have defaulted. The reality is people default — because that’s what student loans can do to you.

We’ve been saying, “If you default, you might as well politicize your inability to pay.” The idea that you can turn your inability to pay into a refusal to pay is grounding for a lot of people, and they want to politicize that. I think this has a lot of potential to move forward, especially if we know we can really keep a lot of people safe.

I think a debt strike is new to a lot of people, so there’s a lot of questions. But some of the same rules apply to a labor strike, tenant strike, or other types of strikes, which is: There’s a different level of vulnerability. Some people can take certain actions, and some people can’t, and that’s okay.

Do you have any other plans in the works?

The other thing we are doing is looking at potential litigation. The reality is tens of millions of people, myself included, were promised relief — and not [in the form of Biden] on the campaign trail. We actually applied, were approved and notified by the Department of Education that this relief is yours and is coming.

We are looking at people who have made significant life decisions. We’ve already spoken to folks who quit their jobs, have moved across the country, have started making plans on having children or had children. They were betting on this relief because the government told them that they were getting it, and now they won’t — at least this iteration of it.

We’ll be pursuing a strategy to influence the rulemaking process that’s about to occur. I’m not sure exactly what that will look like because the White House hasn’t released any details yet. I’m not necessarily betting on it, but it’s possible that we can come out of this rulemaking process with a proposal to eliminate debt that’s bolder than the one that the Biden administration proposed because that’s how the rulemaking process goes.

We’ll be heavily flooding comments and trying to influence that process.

We will pursue some other legally creative ways in which people can assert their right to debt cancellation. We’ve done this in the past with borrower defense.

Can you explain how that worked?

There was a time when predatory for-profit colleges were defrauding people, and there was nothing you could do about it. We found this clause in the Higher Education Act that says if a predatory college defrauds you, you have the right to have that debt discharged.

There was no process for that — that never happened. The Debt Collective created a form based on our legal interpretation of that clause, and people asserted their right to debt relief.

That process took a couple of years, but quickly after, the Department of Education took our forum, copied and pasted it, and created their own. Now if you’re defrauded by a for-profit college, you fill out this form. That process didn’t happen until the Debt Collective and debtors asserted their right to it. We plan to do something similar to that, where we assert our right.

What do you think the political implications of the pause ending will be, especially as we head into the 2024 election?

One of the quickest proposals that people can think of when they think of what the Biden administration has done since taking office has been student debt relief. We saw young voters, particularly young Black and brown voters, stem the tide of the red wave in 2022. And that was when over $10,000  hadn’t even hit people’s accounts yet.

Tens of millions of people, like myself, were promised relief. The Biden administration is now saying, “We’re going to try to give you relief, but it’s going to come from this long process that might not come until next year. In the meantime, you need to start paying in October, or your interest will accrue.”

This is way worse than “the Supreme Court told me no” because he’s not extending any type of pause. This is going to have politically devastating implications for 2024. There’s a much tougher Senate map this year than in 2022.

Imagine if there was a bolder proposal that actually reached people, and they could actually purchase homes, start a business and have children. Going into 2024, Biden can position himself as America’s debt collector or set himself up as the president, akin to FDR, who delivered broadscale debt relief.

How does student debt intersect with medical debt, carceral debt and other forms of debt?

We’ve heard from a lot of people over the past couple of years that, with the pause, they’ve been able to start paying down their credit card debt, medical bills or any carceral debt they have.

There is a clear tie in terms of how the debts intersect, especially when you start to talk about racial and gender aspects, specifically with Black and brown folks. We’ve even seen situations where people who can’t afford their student debt payments have been at risk of incarceration, which is modern-day debtors’ prison.

We’ve also seen an uptick of people who are formerly incarcerated wanting to pursue higher education but having difficulty or needing to take out a lot of student loans, especially if they’re private or not federally backed by the government. This only further compounds the structural inequities for mostly Black and Latino families.

If payments resume, we will see household debt go back through the roof.

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