Today, Congresswoman Maxine Waters (D-CA), Chairwoman of the House Financial Services Committee, gave the following opening statement at a full Committee hearing entitled, “A $1.5 Trillion Crisis: Protecting Student Borrowers and Holding Student Loan Servicers Accountable.”
As Prepared for Delivery
Good morning. Today this Committee convenes for a hearing to examine the student loan debt crisis. It appears that this may in fact be the first ever full Committee hearing in this Committee’s history focused on student lending and the many financial ramifications it has for student borrowers. Given the scale of the crisis at hand, it is long overdue. I thank Congressman Al Green, Chairman of our Subcommittee on Oversight and Investigations, for convening a Subcommittee hearing on this subject earlier this year, and look forward to building on the insights from that hearing during our conversation today.
According to the Federal Reserve, Americans collectively have over $1.6 trillion in student loan debt. That’s more than credit card debt, and more than car loan debt, trailing only mortgage debt. More than 44 million people carry student debt averaging almost $33,000. Around 9 million borrowers with federal student loans are currently in default. The burden of student loan debt is preventing young people from saving for retirement, starting small businesses, starting families, and becoming homeowners. This crisis is affecting people across the country, and ultimately it negatively affects our entire economy.
Nevertheless, Trump’s Education Secretary, Betsy DeVos, has consistently taken actions that are harmful for those with student loans, and the Trump Administration’s appointees to the Consumer Financial Protection Bureau have also undermined key protections. Just last month, the Trump Administration appointed as Student Loan Ombudsman a former executive of a major student loan servicer that is being investigated by several state attorneys general for illegal student loan servicing practices.
I am pleased that we are joined by an outstanding panel of witnesses today, including witnesses who have personally dealt with student loans, have used their positions to raise awareness about the student debt crisis, or who have fought on behalf of consumers against the harmful practices of student loan servicers.
The Education and Labor Committee has an important role to play in this matter, but this Committee does as well, given the need to strengthen protections for student loan borrowers and conduct oversight in the area of student loan servicing. Today we will discuss a series of bills that are designed to help student loan borrowers in a variety of ways. These bills include creating a comprehensive student borrower bill of rights, strengthening credit reporting standards, stopping private debt collectors from going after vulnerable student borrowers, protecting private student loan borrowers, and helping borrowers with student debt purchase their first home. Congress – and this Committee – have a responsibility to take action to ensure student loan borrowers are better protected.