Big news from the scary world of student debt: Strike Debt announced Wednesday that it has abolished $3.8 million worth of private student loan debt since January, spending little more than $100,000 in the process. The group did it to celebrate the 3-year anniversary of the Occupy Wall Street movement.
The initiative purchases debts for pennies on the dollar from debt collectors, and then simply forgives the debt rather than trying to collect it. And while the group is unable to purchase the majority of the $1.2 trillion in outstanding student loan debt because it’s backed by the federal government, private student loan debt is fair game.
The debt the group bought belonged to 2,700 people who had taken out private student loans to attend Everest College, which is a run by Corinthian Colleges. The movement targeted Corinthian because it’s the largest for-profit education company in the country and has found itself in a round of legal troubles after the Consumer Financial Protection Bureau slapped them with a lawsuit over allegations of predatory lending practices.
And while the lawsuit demands that Corinthian forgive more than $500 million in outstanding loan debt, Strike Debt doesn’t think the lawsuit will impact the debts that it has already bought and forgiven.
The money that Strike Debt uses comes from a pool of about $700,000 that it received through fundraising events. Before the group started on student loans, they had abolished more than $15 million in emergency room bills for thousands of people.
However, abolishing all debt related to student loans and medical bills is unrealistic, and the group understands that. Instead of taking that approach, the group has turned its attentions to a new platform called The Debt Collective; the goal is to bring debtors and creditors together so that debtors can negotiate the debt with creditors, or refuse to pay the debt entirely.
No discussion of debt is complete without acknowledging that being forced into debt for basic social services is just another sign of how America is failing her people. Strike Debt member Ann Larson said in a statement that: “Debt is the tie that binds the 99%, whether you are a student delinquent on your student loans or a parent struggling to pay healthcare bills. Being forced into debt for basic social services is a systemic problem.”
Clearly she’s not a libertarian. Never mind that you were poor, it was your choice to take out the loan so you didn’t die from cancer or so you could try to improve yourself and get more skills. You took it out, you pay it back. What does this look like to you, a land of opportunity? We punish you for trying to improve you quality of life; maybe next time, you’ll remember just let the cancer kill you.
source: CNN Money