Gendered “Risk” and Racialized Inheritance: Toward a Feminist Analysis of Debt in US Higher Education

Abstract

Feminist Studies 47, no. 3. © 2021 by Feminist Studies, Inc. 729 Leifa Mayers Gendered “Risk” and Racialized Inheritance: Toward a Feminist Analysis of Debt in US Higher Education The financial aid system in the United States has expanded significantly in recent years, propelled by both the increasing costs of higher education and the greater social and economic emphasis placed on obtaining a bachelor’s degree. Over the past two decades, the percentage of undergraduate students who completed college with debt has more than doubled, to 65 percent, and graduates in the class of 2018 had an average of $29,200 in debt.1 As student debt has expanded, political debates about this crisis and its effects have burgeoned. Recent conversations about how to reform the student loan system have increasingly centered on how the responsibility for risk should be allocated among borrowers, institutions of higher education, and lenders. While some researchers urge colleges and universities to take responsibility for high rates of default by student borrowers, others call upon students to “share[e] responsibility for their personal choices”2 and 1. Veronica Gonzalez, Lindsay Ahlman, and Ana Fung, Student Debt and the Class of 2018: 14th Annual Report, (Oakland, CA: The Institute for College Access and Success, September 2019), 4. 2. Carlo Salerno, “Let’s Fund College the Same Way Investors Fund Start-Ups,” Forbes, August 19, 2015. 730 Leifa Mayers mitigate their own risk by choosing remunerative majors and careers.3 Prominent policy researchers have promoted “income share agreements ,” through which private investors exchange up-front funding for a percentage of future income that is paid back over a period of time following graduation.4 Meanwhile, recent proposals to reform higher education lending have included “institutional risk-sharing,” which tethers institutional viability to graduation and employment outcomes.5 These political and policy discourses are intertwined with materialities of risk in an increasingly financialized system of higher education. Through a series of legislative reforms that began in 1978, the opportunity to discharge most federal and private student loans in bankruptcy was first delayed and then eliminated.6 Unlike car and house loans, student loan debt is secured not by property, but by the person and their future labor.7 Thus, not only is the magnitude and pervasiveness of student loan debt “financializing” student life, but it also refashions student subjects as entrepreneurs and risk managers.8 While the risk attendants of debt operate differently in student loan borrowing than speculative financial markets, they nonetheless inflect student borrower subjectivities. Martin and colleagues describe the consolidation and dispersal of risk as primary instruments of private wealth generation within finance capitalism.9 Whereas securitization bundles 3. Joel Best and Eric Best, review of Game of Loans: The Rhetoric and Reality of Student Debt, in Beth Akers and Matthew M. Chingos, Sociology 54, no. 4 (2017): 373. 4. Miguel Palacios, Tonio DeSorrento, and Andrew P. Kelly, Investing in Value, Sharing Risk: Financing Higher Education Through Income Share Agreements (Indianapolis, IN: Center on Higher Education Reform, American Enterprise Institute, February 2014), 7–12; Investing in Student Success Act of 2017, S. 268, 115th Cong. (2017); Alison Griswold, “Because You’re Worth It: Afraid of Student Loan Debt? Sell Stock in Yourself Instead,” Slate, April 10, 2014. 5. Student Protection and Success Act, S. 1525, 116th Cong. (2019); Student Protection and Success Act, S. 2231, 115th Cong. (2017). 6. The Bankruptcy Reform Act, Pub.L. 95–598, 95th Cong. (1978); Bankruptcy Abuse Prevention and Consumer Protection Act, Pub.L. 109–8, 109th Cong. (2005). 7. Jeffrey J. Williams, “Student Debt and the Spirit of Indenture,” Dissent 55, no. 4 (2008): 75. 8. Randy Martin, Financialization of Daily Life (Philadelphia: Temple Press, 2002), 1. 9. Randy Martin, Michael Rafferty, and Dick Bryan, “Financialization, Risk and Labour,” Competition and Change 12, no. 2 (2008): 121. Leifa Mayers 731 disparate financial assets and facilitates their movement through the market, derivatives spread out financial value to minimize the effects of market volatility. Thus, investors can purchase bundles of loans in the form of bonds and quickly resell or disperse their value. Although federal student loans are not similarly commodified, they represent financial risk that is affixed to the individual borrower...