This week a group of former students calling themselves the Corinthian 15 announced that they were committing a new kind of civil disobedience: a debt strike. They are refusing to make any more payments on their federal student loans.
Along with many others, they found themselves in significant debt after attending programs at the Corinthian Colleges, a collapsed chain of for-profit schools that the Consumer Financial Protection Bureau has accused of running a “predatory lending scheme.” While the bureau has announced a plan to reduce some of the students’ private loan debts, the strikers are demanding that the Department of Education use its authority to discharge their federal loans as well. [...]
Modest fixes are not enough. Consider the interest rate tweaks or income-based repayment plans offered by the Obama administration. They lighten the debt burden on some — but not everyone qualifies. They do nothing to address the $165 billion private loan market, where interest rates are often the most punishing, or how higher education is financed.
Americans now owe $1.2 trillion in student debt, a number predicted by the think tank Demos to climb to $2 trillion by 2025. What if more people from all types of educational institutions and with all kinds of debts followed the example of the Corinthian 15, and strategically refused to pay back their loans? This would transform the debts into leverage to demand better terms, or even a better way of funding higher education altogether.