Honoring Our Promise To Address Comprehensive Toxics Act Of 2021--
Madam President, I ask unanimous consent that the order for the quorum call be rescinded. Madam President, I have been on the floor quite a few times about an industry which is controversial: for-profit schools. If you want to know about…
Madam President, I ask unanimous consent that the order for the quorum call be rescinded.
Madam President, I have been on the floor quite a few times about an industry which is controversial: for-profit schools. If you want to know about for-profit colleges and universities, you have to remember two numbers, and the numbers are these: 8 and 33. Eight percent of the graduates of high schools go to for-profit colleges and universities; 33 percent of all the student loan defaults are students who started out at for-profit colleges and universities.
They are students who didn't finish or ended up with a worthless degree, couldn't make enough money, and defaulted on their student loans. That is an industry that deserves close scrutiny, because, you see, they operate almost exclusively with Federal taxpayers' dollars.
I believe that they have really posed an unscrupulous threat to unsuspecting students, to taxpayers, and to the solvency of Federal student aid programs.
Corinthian Colleges, sounds great, doesn't it? That was one of them, one of the largest for-profit college companies, and one of the worst.
It operated more than a hundred campuses, including six in my home State of Illinois, under names like Everest Colleges, WyoTech, and Heald Colleges.
At its peak, Corinthian enrolled more than 110,000 students, raking in a $1.4 billion sum from the Federal Treasury every year, 1.4 billion for Corinthian. How did Corinthian attract its students? It lied. It invested heavily in marketing and advertising. It created a business model that relied heavily on predatory sales practices. It deliberately misled students into taking on more debt than they could ever, ever repay.
They lied to potential students about the school's job placement rates. They lied about the students' future salary prospects. They lied about whether Corinthian credits could be transferred to another college. Most appallingly, Corinthian recruiters were sent out to look for the most vulnerable targets: high school students whose families had no experience with higher education--minority students.
An internal company document described Corinthian's target demographic as ``isolated people'' with ``low self-esteem.'' People who have ``few people in their lives who care about them'' and people who are ``stuck, unable to see and plan for the future.'' They preyed on these people.
Single moms living close to poverty were the best targets. In 2013, Vice President Kamala Harris, who was then California's attorney general, sued this company for predatory and deceptive business practices. That lawsuit was followed by investigations by four different Federal agencies and more than 20 State attorneys general for consumer fraud on all of their campuses.
Corinthian's enrollment numbers and stock prices tumbled with these investigations, and on April 26, 2015, the whole Corinthian College house of cards collapsed. The company announced abruptly it would close all of its schools the following day.
The announcement left 16,000 students stunned and worried about how they were ever going to pay off the debts they had incurred and about the degrees that they wouldn't be able to finish.
Back in 2015, I called for widespread relief for borrowers defrauded by Corinthian. And last week, these borrowers finally received some long overdue relief. Seven years after they closed Corinthian, they finally got relief from the student loans they incurred because of the fraud of Corinthian Colleges.
In its largest student loan forgiveness action ever, the Education Department recognized the rot that was at the core of Corinthian Colleges and announced it was going to wipe out $5.8
billion in student loan debt owed by 560,000 borrowers who attended the company's for-profit schools.
You see, the Federal Government was saying to the students: These schools are OK. You can borrow Federal money going to these schools.
These students said, well, I couldn't get a Federal loan unless it was a real college or university, and, in fact, they were wrong.
For former Corinthian students, this loan forgiveness means finally their credit scores will start to get above sinking, fewer garnished paychecks, and calls from collection agencies may just slow down. I applaud Education Secretary Cardona and President Biden for their leadership on this simple issue of justice.
This is the latest step the Biden administration has taken to ease the crush of student loan debt.
The administration has used relief programs aimed at a variety of borrowers, including public service workers and people with disabilities. It also paused loan repayment during the pandemic.
President Biden reportedly is considering a broader student loan forgiveness program that would benefit more borrowers, such a program-- if it is responsibly crafted--would be a boon not only to individual borrowers and their families, but also to our economy. It would make it possible for young people to finally restart their lives, buy a car, maybe even a home, start a business, maybe even a family--the kinds of investments that make America grow the right way.
I also believe we need to rethink the provisions in our Federal bankruptcy laws that make student loan debt one of the few debts that cannot be discharged in bankruptcy proceedings. If you declare bankruptcy, you can basically be discharged from any obligation to pay back your mortgage, even your mortgage on a second home, your car loan, or even money that you borrowed for a boat. You can discharge all those in bankruptcies, but you cannot discharge your student loan, in all practical purposes.
Bankruptcy should be allowed to be used as a last resort for borrowers who have no other place to turn. I expect to have more to say about that in the near future.
America needs more trained nurses, doctors, teachers, engineers, mechanics, and skilled professionals and trade workers than ever before. It is in America's national and economic interest to make sure that student loans are a prudent investment and to protect unsuspecting students from unscrupulous organizations like these for-profit colleges and universities.
We should have learned our lesson as a Nation.
I yield the floor.