By Seth Frotman | October 4, 2021
Yesterday, a group of brave active duty servicemembers was featured sharing their firsthand accounts of student loan challenges with CBS News’ “60 Minutes” show. The segment underscored how broken our nation’s student loan system is—and in particular how the failure of the Public Service Loan Forgiveness (PSLF) program has robbed too many of our men and women in uniform of long-term financial certainty.
I was excited to be given the opportunity to contribute to the program regarding the history and policy choices behind PSLF breakdowns—and to underscore that these borrowers are not alone.
PSLF was created based on a simple idea and a basic promise: in return for a decade of service to their communities and our country, public service workers would have their federal student loans forgiven.
When this law passed on a bipartisan basis more than a decade ago, Americans did what Americans always do. They stepped up to give back, working as teachers in classrooms, taking care of our parents as nurses, and keeping the country safe in the Armed Forces. In doing so, millions took on hundreds of billions of dollars of student loan debt—and they did it not just so that they could be better teachers and nurses, but also so that they could be better soldiers, sailors, airmen, and marines.
Then, after upholding their end of the bargain, borrowers applied and were rejected. This was not a one-off occurrence. Right now, more than nine out of every ten public service workers—and more than nine out of ten servicemembers—who apply for PSLF are rejected.
Instead of securing promised relief, public service workers in general and servicemembers in particular have been met with a student loan industry that has had no shame in ripping off those who serve our nation—and a federal government that has been somewhere between incompetent and indifferent to the problems that members of the armed forces and their familes face in accessing PSLF.
For over a decade, some tried to sound the alarm bells, telling anyone who would listen that there were clear signs that the promise of PSLF would be broken.
Those who could have fixed this didn’t listen, and the results are harrowing:
- More than nine out of every ten servicemembers who apply for PSLF is denied.
- Only 124 servicemembers out of hundreds of thousands with student loan debt have ever secured loan forgiveness through the program, including:
- 42 borrowers from the Air Force
- 37 borrowers from the Navy
- 34 borrowers from the Army
- 11 borrowers from the Marines
- As few as 6,800 military borrowers could be on track for PSLF.
- The Department of Education knows that tens of thousands of servicemembers have federal student loans that are not eligible for PSLF, but it has done nothing to step in.
Public service workers are the people who make our communities and countries run—and while they upheld their end of the bargain for student loan relief through a ten-year commitment, Washington didn’t.
Call me old-fashioned, but I think promises should be kept.
It’s time for the Biden administration to take action on behalf of servicemembers with student loan debt, as well as for the millions of teachers, nurses, and other dedicated public service workers whom those who served fought to protect. The administration already has the authority to do it. They already oversee the companies that have made billions of dollars in windfall profits purportedly implementing these protections. And for military borrowers, they already know in detail who these people are.
Washington just needs to gather the courage to make this right.
And, given the public outcry to fix PSLF, we are hopeful meaningful relief will soon be within reach for millions of borrowers. It’s time to fulfill the promise of Public Service Loan Forgiveness.
Seth Frotman is the Executive Director of the Student Borrower Protection Center. He previously served as Assistant Director and Student Loan Ombudsman at the Consumer Financial Protection Bureau. Prior to his work as Student Loan Ombudsman, Seth served as senior advisor to Holly Petraeus, Assistant Director for Servicemember Affairs at the CFPB, where he helped lead the Bureau’s work to protect servicemembers, veterans, and military families. Seth also worked on Capitol Hill, serving as Deputy Chief of Staff and Legislative director for Rep. Patrick Murphy, the first Iraq War veteran elected to Congress.