US: Top education department official resigns, proposes plan to wipe out student debt - - PressFrom - US
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US Top education department official resigns, proposes plan to wipe out student debt

23:40  24 october  2019
23:40  24 october  2019 Source:   nbcnews.com

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A top Education Department official involved in student financial aid resigned from his post Thursday, announcing that he would push an agenda to cancel much of the country's student debt as he vies for a political appointment in the U.S. Senate.

a man and a woman standing in front of a book shelf: Image: A. Wayne Johnson© Robert Berlin Image: A. Wayne Johnson

Although he has no political experience, A. Wayne Johnson said his past two years in the Education Department working closely with Secretary Betsy DeVos has given him a unique perspective on how Congress is best suited to fix the $1.6 trillion student debt crisis.

"Basically, once you get a front-row seat and you get in the belly of the beast, no matter how many operational improvements you're going to do, it's not going to fix something broken at its core," the 67-year-old former private student loan company executive said.

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But Johnson, who began his career in government in 2017 as the chief operating officer of the Office of Federal Student Aid, said reversing the nation's soaring student loan debt requires passing meaningful legislation in Washington.

"What I've seen firsthand is, yep, people criticize the operational execution of the department," Johnson said. "What they don't understand is the secretary and Federal Student Aid have a duty to fulfill the law as it's handed to them."

Betsy DeVos et al. posing for the camera: Image: A. Wayne Johnson, Betsy DeVos© Bob Andres Image: A. Wayne Johnson, Betsy DeVos

Johnson plans to put his name on the list of contenders seeking to fill the seat currently held by the senior Senator from Georgia, Johnny Isakson.

Isakson, a Republican, plans to leave the Senate at the end of the year in the face of various health issues. The office of Gov. Brian Kemp, also a Republican, did not immediately respond to a request for comment about the appointment process.

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About 500 applicants are seeking the role, according to The Atlanta Journal-Constitution.

Johnson, a former banking consultant who completed his doctoral research on student debt, became chief executive of Reunion Student Loan Finance Corp. in 2012. If selected for the Senate seat, Johnson said he would serve as a Republican.

His goal to relieve most student debt in higher education is focusing on borrowers with outstanding federal loans. That amounts to about 43 million Americans, according to the Center for American Progress, a left-leaning think tank.

Johnson's plan, which he describes on his website, includes forgiving up to $50,000 worth of debt per person, which in essence would wipe out entire loan balances for almost 37 million student borrowers, or "customers," as he refers to them.

Students seeking to attend college or a vocational school would also be eligible for a $50,000 voucher to help cover tuition — a grant that would not need to be repaid.

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In addition, student borrowers who have already paid off their loans could apply for income tax credits of up to $50,000.

The cost of the aid, Johnson said, would be financed by a 1 percent tax on all employers. As an extra boost for students struggling with student debt, he is also calling for credit bureau files to remove any negative information related to a person's federal student loans.

"These are the defined benefits that the people would realize," Johnson said. "It's far superior to this very broken ... loan system."

Ben Miller, the vice president for postsecondary education at the Center for American Progress, called Johnson's plan "ambitious."

"If it were a presidential platform, it would be more generous than what Elizabeth Warren is calling for in terms of debt cancellation," Miller said.

Warren, the Massachusetts senator running as a Democratic presidential candidate, has also proposed canceling as much as $50,000 in student debt, but only for households making up to $250,000 a year. (She is also endorsing tuition-free public education.)

Trump Education Official to Resign and Call for Mass Student-Loan Forgiveness

  Trump Education Official to Resign and Call for Mass Student-Loan Forgiveness A senior student-loan official in the Trump administration said he would resign Thursday and endorse canceling most of the nation’s outstanding student debt, calling the student-loan system “fundamentally broken.” © Robert Berlin/The Daily Times/Associated PressA. Wayne Johnson was appointed in 2017 by Education Secretary Betsy DeVos as chief operating officer of the Office of Federal Student Aid, overseeing the $1.5 trillion student-loan portfolio.

Miller said Johnson's initial role as the COO of Federal Student Aid presented him with an insider's perch.

"That role in some ways is one of the more powerful appointed jobs in the government," Miller added. "Unlike a typical political appointee, you can only be removed by the president or by cause."

In January 2018, the Education Department announced Johnson would start a new position as its head of the Office of Strategy and Transformation, which oversaw the launch of a student aid app last year.

The Education Department could not comment Thursday on Johnson's future plans.

The department under DeVos has come under criticism by Democrats and student advocates for its handling of various programs, including Public Service Loan Forgiveness, and for its shift away from clamping down on student loan servicers and for-profit colleges accused of preying on students. Those servicers have made record profits in recent years.

DeVos in an appearance on Fox News last week blasted the Democratic presidential candidates' various proposals for canceling student debt "crazy."

"Who do they think is actually going to pay for these?" she asked. "It's going to be two of the three Americans that aren't going to college paying for the one out of three that do."

Johnson, however, said DeVos is under an incredible strain and is only working within the confines of federal law.

"Secretary DeVos is fully committed every single day," he said, adding that "Congress has put into place very bad laws."

House Democrats advance federal student aid overhaul .
The House Education and Labor Committee on Thursday voted 28-22 to approve a massive overhaul of federal student loans and other higher education programs that they touted as an overdue move to address the costs of higher education. The 1,165-page measure earned no Republican support at the end of a markup that began Tuesday. Among numerous other provisions, it would expand Pell Grants, tweak the Federal Work-Study Program, direct more aid to minority-serving institutions, emphasize campus safety and set several new requirements designed to impose tougher standards on for-profit colleges.

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