Could black philanthropy help solve the black student debt crisis?

Could black philanthropy help solve the black student debt crisis?

Left: Robert Smith. Right (clockwise from left): Beyonce Knowles-Carter, Jay-Z, LeBron James and Nicki Minaj.
Reuters, USA Today

When billionaire Robert E. Smith decided to pay off the student loans of the graduating class of 2019 at Morehouse College, he suggested that others follow his lead.

“Let’s make sure every class has the same opportunity going forward, because we are enough to take care of our own community,” Smith declared in his commencement speech.

But is there even enough black private wealth in the United States to pay off all black student loan debt?

As a scholar in social transformation and African American studies, I’m intrigued by this question. It provides an opportunity to examine black wealth, higher education and the possibilities for alleviating debt, which in turn opens the door to new economic opportunities.

Black celebrities give to higher education

Smith’s gift is estimated to be worth US$40 million and will benefit 396 students.

That’s a lot of money, and he’s done it before. Before his gift to Morehouse, Smith donated $50 million to Cornell University, his alma mater, in part to support African American and female students at Cornell University’s College of Engineering.

Other black celebrities have also stepped up to fund education. Powerhouse couple Beyonce and Jay Z gave more than $1 million in scholarships to students who lived in cities they were touring in 2018.

Rapper Nicki Minaj gave 37 “Student of the Game” scholarships. LeBron James, through his foundation, promised to pay for 2,300 students to attend the University of Akron – at an estimated price tag of $100 million. Oprah Winfrey has donated more than $400 million to educational causes.

But with just five black billionaires in the United States – Smith, Winfrey, David Steward, Michael Jordan and Jay-Z – monumental gifts like the one that Smith made will likely be few and far between.

Is Smith’s claim that “we are enough to take care of our own community” true of all the black wealth in the U.S.?

Philanthropy among African Americans

A strong heritage of black philanthropy dates back to mutual aid societies of the 1700s and 1800s in which free blacks sought to help fellow blacks facing hardships or distress and, in later years, in need of education and job training.

Black charitable giving also arose from the black church and fraternal organizations throughout the 1800s and 1900s with movements such as abolitionism, the Black Women’s Club Movement and the civil rights movement.

Mary Church Terrell, the first president of the National Association of Colored Women, described how charitable organizations had “a keen sense of the responsibility” to secure economic and educational resources, “lifting as we climb” up the ladder of social mobility. This ethic of giving was also present among the early black economic elite such as Thomy Lafon, Madame C.J. Walker and James Forten.

Black giving remains strong to this day. Despite racial wealth gaps, black families contribute larger portions of their wealth than any other racial and ethnic group. The W.K. Kellogg Foundation reports that two-thirds of all black households donate to charitable causes. This giving amounts to about $11 billion annually, most of which goes to religious organizations.

But how much of it goes to higher education? African Americans across the socioeconomic spectrum report donating 17% to education – both K-12 and post-secondary institutions and scholarship funds. That adds up to about $1.8 billion donated annually.

Counting black millionaires

The percentage of black households worth over $1 million has remained at or below 2% since 1992, or about 877,000 based on 2018 population estimates.

Among black high net worth households – those with a net worth of more than $1 million (not counting the value of their primary home) or with an annual household income of $200,000 – 49% report giving to higher education. This is significant since across all racial groups, the share of dollars donated by high net worth individuals to higher education was only 4%.

Black student loan debt

Student loan debt in the U.S. reached an all-time high in 2019, making it the second-highest consumer debt category behind mortgage debt. Over 44 million borrowers owe roughly $1.5 trillion in student loan debt.

Looking at 2016 data, 86.4% of blacks completing a bachelor’s degree had some form of student loan debt, and the average amount borrowed was $34,010. If we multiply the total number of blacks that graduated with some form of debt – roughly 168,000 – by the average amount borrowed per individual, the average cumulative debt for this one graduating class was roughly $5.7 billion. This includes graduates from all colleges – public as well as private – but not community colleges.

Of course, looking at it at the most basic level, the collective wealth among America’s black billionaires – which totals $13.4 billion with the recent addition of Jay-Z – can easily subsidize the debt of a single graduating class.

And while a more sophisticated calculation is undoubtedly warranted, a rough estimate shows that the $5.7 billion in black student debt could be covered by America’s black millionaire households if each one chose to devote $6,500 toward eliminating the overall debt.

Of course, the debt load for black students goes far beyond one graduating class. The majority of blacks in the labor force that hold a bachelor’s degree or higher have some form of student loan debt. This means that the figures for the entire black population with outstanding student loan debt across generations are significantly higher than $5.7 billion.

Robert Smith’s gift to the class of 2019 at Morehouse provoked an interesting discussion about whether black philanthropy can alleviate black student loan debt. However, one-off philanthropic efforts that help a small group of beneficiaries can’t compete with the kind of large-scale change needed to alter the course of an entire community.The Conversation

Mako Fitts Ward, Clinical Assistant Professor, African and African American Studies & Women and Gender Studies, School of Social Transformation, Arizona State University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

This Just In: Nicki Minaj Supports Obama

This Just In: Nicki Minaj Supports Obama

ATTENTION GRABBER: On Twitter, rapper Nicki Minaj was ecstatic to have drawn the attention of President Obama with her supposed endorsement of GOP presidential nominee Mitt Romney. (Photo: Christopher Macsurak/Wikipedia)

Well, good news: Nicki Minaj supports President Obama after all. Whew! That’s a relief.

Last week, you may recall, the twitterverse was all abuzz after the colorful rapper set off speculation that she was supporting Republican presidential nominee Mitt Romney. Her featured track on Lil Wayne’s latest mixtape caught the rapper sharing some puzzling lyrics that indicated she was casting her lots with the GOP. On Lil Wayne and Kanye West’s song “Mercy,” Minaj raps: “I’m a Republican voting for Mitt Romney/You lazy b***es is f***ing up the economy.”

Almost immediately, the world broke into an uproar attempting to decipher the eccentric rapper’s true intentions behind the cryptic verses. Rolling Stone magazine chimed in on the discussion when it raised the question of whether or not her words were a deliberate endorsement or just a provocative lyric.

But, this week, after President Obama was asked about the song and Minaj’s apparent endorsement of Romney, he told radio station WPYO-FM in Orlando, Florida, that he wasn’t so sure it was a Romney plug. “She likes to play different characters,” he said.

Minaj immediately jumped on the moment. In a tweet, she thanked Obama for understanding: “my creative humor and sarcasm,” then noted: “the smart ones always do …”

In the past the hip-hop star has been known to produce songs filled with controversial lyrics that many felt were for publicity and self-promotion. Rapper Talib Kweli agrees. In a tweet posted last week, he said, “I doubt Nicki seriously supports Romney. Her lyrics ain’t political. She just wants y’all to talk about her & she winning cuz it’s working!”

I particularly enjoyed another tweet from Kweli that helped tease out the irony in the apparent existential crises so many were experiencing after the Minaj mystery hit:

Taking Minaj seriously, Huffington Post contributor Kia Makarechi observed that, “Minaj is hardly the first hip-hop figure to take a stance on the election.” In fact, Makarechi added that a week earlier Jay-Z had presented a video to concertgoers at his Made in America Festival that highlighted President Obama encouraging everyone to vote in the upcoming election.

One pop star that is definitely not a Romney supporter is Black Eyed Peas leader will.i.am. A couple weeks ago at the Republican National Convention, Gov. John Kasich quoted the band in his speech. Kasich said:

You know, I don’t know about you … but I’ve got a feeling. I’ve got a feeling –- and it’s not just because I like the Black Eyed Peas –- I’ve got a feeling we’re about to elect a new president of the United States of America!

Unhappy with the musical reference and his band’s indirect connection with the RNC, will.i.am tweeted, “Hey Gov Kasich #Igotafeeling that Ohio needed the auto bail out…#unitedamericanotdivided let’s educate our youth #reachforthestars.”

The following day, will.i.am continued to fight back in an emotionally charged television interview with Marlow Stern in North Carolina, to discuss his support for the President at the Democratic National Convention.

In different ways, both will.i.am and Nicki Minaj proved their influence in the culture, not to mention the way that pop music, hip-hop, and the opinions of its artists have become an important part of today’s politics.