Analysis Law and Policy

Student Debt Is a Women’s Issue

Sheila Bapat

According to earnings statistics, women get far less bang for their buck out of higher education. Recent proposals to reduce student debt could benefit women over the course of their lives—but they may not go far enough.

Because student debt affects a large swath of Americans who struggle to build wealth over the course of their careers, it is primarily discussed as a class and an economic stimulus issue. But student debt is also an issue of particular importance for women. According to earnings statistics, women get far less bang for their buck out of higher education. Recent proposals to reduce student debt could benefit women over the course of their lives—but they may not go far enough.

Women make up the majority of higher education students, yet they earn far less than men with the same degrees. For the past several years women have outnumbered men in undergraduate and master’s programs, and as of 2010 women outnumber men in PhD programs as well. With respect to the two most expensive degrees, law and medicine, in 2009-10 women comprised 45 percent of law school classes, and as of 2011 they made up 48 percent of medical school graduates. This NPR piece from 2010 discusses how even though women are earning more engineering, math, and science PhDs than they were in previous years, women still experience wage disparities in these fields after graduation. The American Association of University Women (AAUW) found in a study last year that the student loan repayment burden is higher for women than for men for a variety of reasons, including the gender pay gap, which begins right after college graduation.

And gender-wage disparities hold true across multiple sectors. Last month the National Women’s Law Center pointed out that on average “women who work full time, year round are paid only 77 cents for every dollar paid to their male counterparts—a pay gap that translates to $11,084 in lost wages annually.” The disparity is even greater for women of color. A study released last month from the National Partnership for Women and Families revealed that of the 50 largest urban cities, not a single one had eliminated the wage gap; neither had any state. There are a variety of causes for the wage gap: leaving the workforce to care for children or parents is still something more women take on, and even after controlling for life choices women on average earn 91 cents to the dollar. Discrimination is believed to account for this chunk of the wage gap.

Women also tend to gravitate toward professions that pay less in general. For example, women dominate the non-profit sector, where the earning potential is far lower than the private sector. Non-profit salaries for management level positions,  which women with higher degrees may aspire to, pay far lower than in the private sector.

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“The existing gender pay gap is making it hard for women, especially women of color, to pay back their student loans,” Working Families Party (WFP) organizer Nelini Stamp told Rewire. WFP is working to reform student loan practices. “The proposals we see to reduce interest rates are a move in the right direction, but instead of just debt relief programs we need to focus on affordability of higher education so we are not sending new generations into debt.”

To help address this issue, some lawmakers are working to reduce federal student loan interest rates, which are set to skyrocket July 1. A proposal by Sen. Elizabeth Warren (D-MA) goes the furthest by seeking to reduce federal student loan interest rates to 0.75 percent, on par with the interest rate banks pay on some of their Federal Reserve loans. Sen. Dick Durbin (D-IL) advocates a more conservative measure of capping student loan interest rates so that they do not skyrocket during a period of high interest rates.

Elena Peifer is a third-year student at the University of Michigan School Law. She opted not to attend Columbia University School of Law because she would have wound up with $222,000 in debt upon graduation. Even after a strong financial aid package from the University of Michigan Law School, she will still be left with a $45,000 student loan bill upon graduation.

“Forty-five thousand dollars still seems like an exorbitant amount of money, because as a public interest lawyer, I will be making less than that out of law school,” Peifer told Rewire. Peifer chose the more financially sound option, Michigan Law, because she is committed to practicing public interest law with non-profits that pay far less than big law firms do. In general, women who earn law degrees are more likely to pursue lower-paying public interest careers.

Women’s tendency to earn less overall means they will spend a larger percentage of their incomes paying off student debt and may accrue less wealth over time, as a piece in U.S. News and World Report pointed out earlier this month. Though student debt reform is not a solution to the wage gap, it can help improve women’s economic status by enabling them to save more. It can also serve as economic stimulus, as women would have more income to spend.

There are some debt relief programs for students who choose careers in public interest—Peifer is benefiting from at least one—but these options are not widespread.

Jessica Galeria graduates this week with an MBA from the University of California Berkeley Haas School of Business, and she will have about $50,000 in debt. She attended business school at night while working for a large non-profit, where she serves as associate director of strategic development and fundraising.

“One of the surprises for me is that there aren’t debt relief programs that were viable for me. I definitely looked into it,” she said. “So in general, I’m laudatory of the federal government efforts to reduce burden of student debt.”

Analysis Politics

Experts: Trump’s Proposal on Child Care Is Not a ‘Solution That Deals With the Problem’

Ally Boguhn

“A simple tax deduction is not going to deal with the larger affordability problem in child care for low- and moderate-income individuals," Hunter Blair, a tax and budget analyst at the Economic Policy Institute told Rewire.

In a recent speech, GOP presidential nominee Donald Trump suggested he now supports policies to made child care more affordable, a policy position more regularly associated with the Democratic Party. The costs of child care, which have almost doubled in the last 25 years, are a growing burden on low- and middle-income families, and quality options are often scarce.

“No one will gain more from these proposals than low- and middle-income Americans,” claimed Trump in a speech outlining his economic platform before the Detroit Economic Club on Monday. He continued, “My plan will also help reduce the cost of childcare by allowing parents to fully deduct the average cost of childcare spending from their taxes.” But economic experts question whether Trump’s proposed solution would truly help alleviate the financial burdens faced by low- and middleincome earners.

Details of most of Trump’s plan are still unclear, but seemingly rest on addressing child care costs by allowing families to make a tax deduction based on the “average cost” of care. He failed to clarify further how this might work, simply asserting that his proposal would “reduce cost in child care” and offer “much-needed relief to American families,” vowing to tell the public more with time. “I will unveil my plan on this in the coming weeks that I have been working on with my daughter Ivanka … and an incredible team of experts,” promised Trump.

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An adviser to the Trump campaign noted during an interview with the Associated Press Monday that the candidate had yet to nail down the details of his proposal, such as what the income caps would be, but said that the deductions would only amount to the average cost of child care in the state a taxpayer resided in:

Stephen Moore, a conservative economist advising Trump, said the candidate is still working out specifics and hasn’t yet settled on the details of the plan. But he said households reporting between $30,000 and $100,000, or perhaps $150,000 a year in income, would qualify for the deduction.

“I don’t think that Britney Spears needs a child care credit,” Moore said. “What we want to do is to help financially stressed middle-class families have some relief from child-care expenses.”

The deduction would also likely apply to expensive care like live-in nannies. But exemptions would be limited to the average cost of child care in a taxpayer’s state, so parents wouldn’t be able to claim the full cost of such a high-price child care option.

Experts immediately pointed out that while the details of Trump’s plan are sparse, his promise to make average child care costs fully tax deductible wouldn’t do much for the people who need access to affordable child care most.

Trump’s plan “would actually be pretty poorly targeted for middle-class and low-income families,” Hunter Blair, a tax and budget analyst at the Economic Policy Institute (EPI), told Rewire on Monday.

That’s because his tax breaks would presumably not benefit those who don’t make enough money to owe the federal government income taxes—about 44 percent of households, according to Blair. “They won’t get any benefit from this.”

As the Associated Press further explained, for those who don’t owe taxes to the government, “No matter how much they reduce their income for tax purposes by deducting expenses, they still owe nothing.”

Many people still may not benefit from such a deduction because they file standard instead of itemized deductions—meaning they accept a fixed amount instead of listing out each qualifying deduction. “Most [lower-income households] don’t choose to file a tax return with itemized deductions,” Helen Blank, director of child care and early learning at the National Women’s Law Center (NWLC), told Rewire Tuesday. That means the deduction proposed by Trump “favors higher income families because it’s related to your tax bracket, so the higher your tax bracket the more you benefit from [it],” added Blank.

A 2014 analysis conducted by the Congressional Research Service confirms this. According to its study, just 32 percent of tax filers itemized their deductions instead of claiming the standard deduction in 2011. While 94 to 98 percent of those with incomes above $200,000 chose to itemize their deductions, just 6 percent of tax filers with an adjusted gross income below $20,000 per year did so.

“Trump’s plan is also not really a solution that deals with the problem,” said Blair. “A simple tax deduction is not going to deal with the larger affordability problem in child care for low- and moderate-income individuals.”

Those costs are increasingly an issue for many in the United States. A report released last year by Child Care Aware® of America, which advocates for “high quality, affordable child care,” found that child care for an infant can cost up to an average $17,062 annually, while care for a 4-year-old can cost up to an average of $12,781.

“The cost of child care is especially difficult for families living at or below the federal poverty level,” the organization explained in a press release announcing those findings. “For these families, full-time, center-based care for an infant ranges from 24 percent of family income in Mississippi, to 85 percent of family income in Massachusetts. For single parents the costs can be overwhelming—in every state annual costs of center-based infant care averaged over 40 percent of the state median income for single mothers.”

“Child care now costs more than college in most states in our nation, and it is an actual true national emergency,” Kristin Rowe-Finkbeiner, CEO and executive director of MomsRising, told Rewire in a Tuesday interview. “Donald Trump’s new proposed child care tax deduction plan falls far short of a solution because it’s great for the wealthy but it doesn’t fix the child care crisis for the majority of parents in America.”

Rowe-Finkbeiner, whose organization advocates for family economic security, said that in addition to the tax deduction being inaccessible to those who do not itemize their taxes and those with low incomes who may not pay federal income taxes, Trump’s proposal could also force those least able to afford it “to pay up-front child care costs beyond their family budget.”

“We have a crisis … and Donald Trump’s proposal doesn’t improve access, doesn’t improve quality, doesn’t lift child care workers, and only improves affordability for the wealthy,” she continued.

Trump’s campaign, however, further claimed in a statement to CNN Tuesday that “the plan also allows parents to exclude child care expenses from half of their payroll taxes—increasing their paycheck income each week.”

“The working poor do face payroll taxes for Social Security and Medicare, so a payroll tax break could help them out,” reported CNN. “But experts say it would be hard to administer.”

Meanwhile, Democratic presidential nominee Hillary Clinton released her own child care agenda in May, promising to use the federal government to cap child care costs at 10 percent of a family’s income. 

A cap like this, Blank said, “would provide more help to low- and middle-income families.” She continued, “For example, if you had a family with two children earning $70,000, if you capped child care at 10 percent they could probably save … $10,000 a year.”

Clinton’s plan includes a promise to implement a program to address the low wages many who work in the child care industry face, which she calls the “Respect And Increased Salaries for Early Childhood Educators” program, or the RAISE Initiative. The program would raise pay and provide training for child-care workers.

Such policies could make a major difference to child-care workers—the overwhelming majority of which are women and workers of color—who often make poverty-level wages. A 2015 study by the EPI found that the median wage for these workers is just $10.31 an hour, and few receive employer benefits. Those poor conditions make it difficult to attract and retain workers, and improve the quality of care for children around the country. 

Addressing the low wages of workers in the field may be expensive, but according to Rowe-Finkbeiner, it is an investment worth making. “Real investments in child care bring for an average child an eight-to-one return on investment,” she explained. “And that’s because when we invest in quality access and affordability, but particularly a focus on quality … which means paying child-care workers fairly and giving child-care workers professional development opportunities …. When that happens, then we have lower later grade repetition, we have less future interactions with the criminal justice system, and we also have a lower need for government programs in the future for those children and families.

Affordable child care has also been a component of other aspects of Clinton’s campaign platform. The “Military Families Agenda,” for example, released by the Clinton campaign in June to support military personnel and their families, also included a child care component. The former secretary of state’s plan proposed offering these services “both on- and off-base, including options for drop-in services, part-time child care, and the provision of extended-hours care, especially at Child Development Centers, while streamlining the process for re-registering children following a permanent change of station (PCS).” 

“Service members should be able to focus on critical jobs without worrying about the availability and cost of childcare,” said Clinton’s proposal.

Though it may be tempting to laud the simple fact that both major party candidates have proposed a child care plan at all, to Rowe-Finkbeiner, having both nominees take up the cause is a “no-brainer.”

“Any candidate who wants to win needs to take up family economic security policies, including child care,” she said. “Democrats and Republicans alike know that there is a child care crisis in America. Having a baby right now costs over $200,000 to raise from zero to age 18, not including college …. Parents of all political persuasions are talking about this.”

Coming up with the right way to address those issues, however, may take some work.

“We need a bold plan because child care is so important, because it helps families work, and it helps them support their children,” the NWLC’s Blank said. “We don’t have a safety net for families to fall back on anymore. It’s really critical to help families earn the income their children need and child care gives children a strong start.” She pointed to the need for programs that offer families aid “on a regular basis, not at the end of the year, because families don’t have the extra cash to pay for child care during the year,” as well as updates to the current child care tax credits offered by the government.

“There is absolutely a solution, but the comprehensive package needs to look at making sure that children have high-quality child care and early education, and that there’s also access to that high-quality care,” Rowe-Finkbeiner told Rewire. 

“It’s a complicated problem, but it’s not out of our grasp to fix,” she said. “It’s going to take an investment in order to make sure that our littlest learners can thrive and that parents can go to work.”

News Politics

Progressives Notch Wins, Anti-Choice Republican Gets the Boot in State Primaries

Ally Boguhn

U.S. Rep. Tim Huelskamp (R-KS), whip of the congressional Pro-Life Caucus, was defeated after losing the support of business groups and the agricultural lobby in Kansas.

State primary elections brought major victories for progressive candidates on Tuesday and saw incumbent Rep. U.S. Rep. Tim Huelskamp (R-KS)—an anti-choice member of the extreme House Freedom Caucus—lose his seat to his primary challenger.

In Washington state, progressive candidate state Sen. Pramila Jayapal advanced to the general election in November in her bid to replace retiring Rep. Jim McDermott (D) in Washington’s 7th Congressional District.

The candidate has “been a champion for access to healthcare, and commonsense gun safety and civic engagement as well as for women, workers, students, communities of color, low-income communities, immigrants and refugees,” according to Jayapal’s website. That work earned her the endorsement of Sen. Bernie Sanders (I-VT), who solicited donations for her campaign telling supporters in an email that Jayapal is “not afraid to take on powerful special interests” and is “running her campaign with our political revolution.”

Sanders lauded Jayapal’s win Wednesday in a statement circulated by press release. “Pramila just proved that candidates can run a strong progressive campaign funded by small-dollar donors and win big,” Sanders said. “The people-powered movement that propelled our campaign to victory in states around the country is already changing how campaigns are run up and down the ticket.”

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Liberal and progressive groups praised Jayapal as news of her primary win broke.

“Pramila Jayapal winning this primary is huge for progressives,” Stephanie Taylor, co-founder of the Progressive Change Campaign Committee, said in a statement on the night’s election results. “She is a bold progressive game changer whose strong performance shows that voters are hungry for bold progressive ideas like expanding Social Security benefits, debt-free college, and a $15 minimum wage. With Pramila’s record as an accomplished activist and state senator, we are confident Pramila will be one of the strongest partners progressives have ever had in Congress and one of the strongest representatives Washington has ever had.”

Stephanie Schriock, president of EMILY’s List, called Jayapal a “a progressive leader and a tireless advocate for women and families” in a Wednesday statement. “She understands the importance of increasing economic opportunities and protecting women’s access to health care. EMILY’s List is proud to continue supporting Pramila in her historic bid to be the first Indian American woman elected to Congress.”

Elsewhere in the state, fellow progressive candidate Darcy Burner finished among the top two candidates in her race for the state’s 5th District House seat. The state’s primary system allows the top two candidates to advance to the November election regardless of party affiliation.

In Kansas, the incumbent Huelskamp lost his primary race to challenger Roger Marshall. The three-term congressman has represented the state’s 1st Congressional District since 2011, where he has carved out a place for himself among the extremist House Freedom Caucus (HFC), which has pushed ultra-conservative and anti-choice policies in Congress. Huelskamp was one of a dozen politicians backed by the HFC’s unofficial PAC, the House Freedom Fund, as Rewire reported.  

Huelskamp championed anti-choice efforts prior to being elected into office and was “active in assisting women in crisis pregnancies” during graduate school, according to his website. He continued that legacy in Congress, where he serves as the Pro-Life Caucus whip.  

Huelskamp in 2012 notoriously delivered a speech on the House floor comparing abortion care to slavery and accusing both Planned Parenthood and the Obama administration of being racist. He again used race to push his anti-choice position in 2015, tweeting that those who accepted awards from Planned Parenthood supported a “racist” agenda.

According to the New York Times, Huelskamp’s challenger Roger Marshall “won with the support of business groups and the agriculture lobby, which had turned its back on Mr. Huelskamp after Speaker John A. Boehner had him removed from the Agriculture Committee in 2012, a crucial position for a legislator from a farm state.”

During the primary race, Huelskamp released an ad questioning whether Marshall, an OB-GYN, was truly pro-life and claimed he “supports pro-abortion groups that back Planned Parenthood and Hillary Clinton.” The accusation reportedly refers to a donation from the American Congress of OB-GYNs PAC to Marshall, and a previous donation he made to the group.

Marshall’s campaign website prominently displays the Republican candidate’s “pro-life” position and touts a recommendation of his from the anti-choice American Association of Pro-Life Physicians and Gynecologists. 

Brent Robertson, Marshall’s campaign spokesperson, however, defended the candidate’s anti-choice position in a statement to the Topeka-Capitol Journal in January.

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