Obama’s 2011 Parent PLUS loan rules cut HBCU enrollment sharply

Evidence

Matters have only gotten worse with recent federal policy. The Obama administration changed the standards for Parent PLUS loans in 2011. Borrowers could not have any accounts more than 90 days late, or any foreclosures, wage garnishments, or defaults within the last five years. This requirement was passed just three years after the economic disaster of 2008. Predictably, the new rule change devastated black colleges. Some lost as much as 20 percent of their student body. In the academic year of 2012–13, the United Negro College Fund reported that “the number of students attending HBCUs with Parent PLUS loans dropped by 45 percent, or more than 17,000 students.” Already-tight budgets were hit. Over 80 percent of the budgets of HBCUs comes from financial aid. — Eddie S. Glaude Jr., Democracy in Black, 367

Categorization

• QUESTION: Worth chasing how the post-2008 credit tightening rationale interacted with the value gap in policy design.
• XREF: Complicates the reader’s question about black loyalty to the Democratic Party: this is a Democratic administration’s policy harming black institutions.