MADISON, Wis. — Under Gov. Scott Walker and a GOP legislative majority, since 2011 Wisconsin has risen to the third highest percentage of college graduates with student debt. With such an abysmal track record on student debt, One Wisconsin Now Executive Director Scot Ross said it’s no surprise that Walker and the GOP’s latest scheme denies real help to nearly one million state student loan borrowers.
“Allowing borrowers to refinance their student loans, just like you can with a mortgage could help hundreds of thousands of Wisconsinites who worked hard to get their education and took on the personal responsibility to pay for it,” said Ross. “Any plan that doesn’t include this simple, common sense reform is not a serious attempt to help with the student loan debt crisis.”
Media reports indicate that, unfortunately, for nearly one million Wisconsin student loan borrowers with $19 billion in student loan debt, Walker will continue to oppose law changes that would help them by allowing them to refinance their loans at a lower interest rates.
Nationally student loan debt totals $1.3 trillion dollars and is rising. According to a comprehensive 50 state study on student loan debt for 2014 by The Institute for College Access and Success (TICAS) seventy percent of Wisconsin college graduates have student loan debt, the third highest percentage in the nation, and their average debt load exceeded $28,800.
The TICAS study also found that over the last decade Wisconsin graduates were saddled with a seventy four percent increase in the amount of debt upon graduation and that ten percent more graduates were leaving school with student debt.
Original research from One Wisconsin Institute found that student loan debt has a significant and negative impact on the Wisconsin economy. Borrowers are much more likely to rent versus own their home and over $200 million in new car sales are lost annually due directly to student loan debt.
“There are only two things Gov. Walker can do to reduce existing debt on student loan borrowers: forgive the debt, or allow students to refinance their loans at lower rates under the Higher Ed, Lower Debt bill,” said Ross. “The first would cost $19 billion, the other, costs nothing.”
Groundbreaking state legislation, the Higher Ed, Lower Debt Act (SB 194 & AB 272) creating a state based authority to help student loan borrowers refinance their debt, just like you can with a mortgage and extending a state tax break to student loan payments, has been introduced again in the 2015 legislative session. However Gov. Walker and the Republicans in control of the legislature have allowed the bill with 50 sponsors to languish in committee. Late last week Walker indicated he would continue to oppose the measure.
Ross concluded, “Once again we see Gov. Walker saying one thing and doing another. By rejecting a common sense plan to allow borrowers to refinance their student loans he is leaving no doubt that he is firmly in the pocket of the big banks, and Wisconsin’s one million student loan borrowers will continue to pay the price.”