An Oregon trail to end student debt: “Pay it forward, pay it back” model leaves big banks out of education
July 10, 2013
On July 1, federal student loan rates doubled—yes, doubled—from 3.4 percent to 6.8, after members of Congress went home for fireworks without lifting a finger on the issue. Meanwhile, in Oregon, legislators unanimously passed a bill paving the way for students to attend public universities without paying tuition or taking out traditional loans at all.
Fueled by the organizing savvy, policy creativity, and relentless effort of the state Working Families Party, and by a classroom of outstanding college students, the new bill offers a progressive victory and a common-sense national model on an issue where Congress has recently been derelict at best. The legislation, which Democratic Governor John Kitzhaber is expected to sign, instructs Oregon’s Higher Education Coordination Commission to come up with a “Pay It Forward, Pay It Back” public university financing model in time for a legislative vote in 2015.
Under such a model, students pay nothing while in school; instead, after graduation, four-year students pay 3% of their income for the next two decades or so to fund the education of future students—without a role for the big banks. (Those who attend for less time would pay a pro-rated amount.) Once start-up costs are addressed (no small matter), the system could pay for itself. It would ask the most money of those graduates best equipped to pay, and it would represent a huge stride in putting an end to the crushing debt horror stories which Occupy Wall Street helped to place on the national radar.
While victories like Oregon’s are often the result of decade-long campaigns, this incremental step came to pass with a speed that surprised even its most ardent supporters. And it demonstrates the power of unconventional alliances. The “Pay It Forward” approach has been tried in Australia, but not in the United States. It got legs here when John Burbank, who directs the Seattle-based Economic Opportunity Institute, connected with a college class taught by Barbara Dudley, who co-founded the Working Families Party of Oregon. Students in the Portland State University class, “Student Debt: Economics, Policy and Advocacy,” took up a push for “Pay It Forward” as their group project, and the WFP embraced it as a legislative priority. Together, they seized legislators’ attention, and secured their support.
In the process, WFP activists and allies talked to thousands of students, built a coalition ranging from MoveOn.org to the faith group Jubilee USA, and won over university administrators. It was a classic “inside-outside” fight, in which the potency of skillful lobbying and common-sense argument were amplified several times over by grassroots firepower. The unanimous vote in favor of the bill can also be credited in part to the WFP’s successful electoral efforts last year, in which the party ousted Oregon’s most conservative Democratic state representative in a primary and helped power another Democrat to victory in a swing district. With the Higher Education Coordination Commission tasked with incubating the plan, and a legislative vote looming in 2015, the WFP has pledged to get to work on ensuring a progressive result from the HECC, and making approval of that plan a major issue in the 2014 campaign.
“We never imagined that we would actually accomplish something like this, and definitely not in such a short time,” student Ariel R. Gruver told The New York Times. The Times’ Richard Perez-Pena noted that “The speed and unanimity offer a sharp contrast with Washington…” You can say that again. Progressives, who face slow-motion crises on a battery of issues and the ever-present danger of cynicism, could use another reminder that it’s still possible in this political landscape to pass a big, just idea through hard work and visionary organizing. Both will also be necessary if we’re to send a powerful message to members of Congress who just doubled interest rates: Americans deserve much better.
Comic by Matt Bors
What are everyone’s thoughts on this type of model?