Friday, Dec. 15, 2017

[0] From the New York Times, I'm Michael Barbarrow.

[1] This is the Daily.

[2] Today, student loan debts are soaring, and so are defaults on those loans.

[3] A Times investigation finds that creditors are taking extreme measures to get paid.

[4] Measures that are costing people the jobs they took out loans to get and that they need to pay back their loans.

[5] It's Friday, December 15th.

[6] So I've been reporting on the student debt crisis in America since the beginning of the year.

[7] And all of its causes and effects and the impact it's having on people just as they're graduating from school.

[8] Jessica Silver Greenberg is a business reporter at the Times.

[9] And in the course of that reporting, I found this woman, Shannon Otto, who had this incredible story.

[10] But it was one that at first I could only see through the government document.

[11] that I was looking at.

[12] I wasn't able to find her for a while.

[13] Then I eventually got in touch with her.

[14] This is Shannon.

[15] Her story starts.

[16] She's this young woman in Nashville.

[17] I was born at Nashville General Hospital and lived in Nashville all my life.

[18] So it's the 1990s in Tennessee and...

[19] When I was 15, I became pregnant.

[20] She gets pregnant unexpectedly.

[21] And I had a couple of of choices that I could have made there.

[22] She's thinking about being a single mom.

[23] She's on her own.

[24] She's in a really tough situation with her family.

[25] And I decided to keep my child and go on to be an adult immediately.

[26] So she decides to get emancipated.

[27] And that means she's going to become legally independent.

[28] And suddenly, even though she has legal freedom and legal independence, she needs to find financial independence.

[29] for her and her child, the kid she's expecting.

[30] And so she decides that the best route for that is to become a nurse.

[31] Any person with age and wisdom would look at that situation and say, no, she's not going to make it.

[32] And I said, yes, I am.

[33] Watch me. And then Shannon's life really just takes off.

[34] I immediately found where I could go and take my GED test because I was only in the 10th.

[35] grade at the time.

[36] She passes her GED.

[37] I went for my nursing school interview at General Hospital.

[38] She finds a nursing school that she wants to attend.

[39] And I got accepted into the program.

[40] And this one has the great advantage of allowing her to work in order to pay off her tuition.

[41] You could sign on to work for General Hospital for two years in payment for your schooling.

[42] But then things take a turn for the worse.

[43] About three months into the nursing program at General Hospital.

[44] We just came to school one day and there was a chain on the doors and a sign on the doors that says the school has been closed.

[45] So Shannon has to figure out another school to go to.

[46] And she finds Tennessee Tech and gets in.

[47] The only challenge now is she doesn't have free tuition anymore.

[48] That arrangement where she gets to work and pay off her tuition, that's gone.

[49] And how did that change your circumstances?

[50] I took out student loans.

[51] You know, I really didn't even have to fill out much paperwork.

[52] There was a person there in an office that did most of that for me. She made me feel like this is what everybody does to go to school.

[53] And this is your only option.

[54] How much in loans did you take out in the end?

[55] I qualified for some of the tuition money through grants.

[56] So I took out about $8 ,000, I think, loans.

[57] How old were you at this point?

[58] I was still 16 years old.

[59] Wow.

[60] After Shannon takes out these loans, her life seems to be going well again.

[61] She loves nursing school.

[62] I wanted to learn, and that's exactly what I did.

[63] She graduates.

[64] I immediately started working in women's health.

[65] And she's making good money.

[66] I made more money than anybody in my age group.

[67] She meets a guy, she gets married, she falls in love.

[68] At 27, I bought a house in East Nashville.

[69] They have another baby.

[70] You know, we had two cars and she's paying off her loans.

[71] It sounds like this was all working out pretty much according to your plan.

[72] You're getting to have the career that you wanted in the field that you wanted and you're able to pay these bills.

[73] And take care of yourself and your child.

[74] Yeah.

[75] Life was wonderful.

[76] And everything was great until I turned 30.

[77] I was in a patient's home.

[78] It was getting to be dusk.

[79] It was getting dark out.

[80] I pulled the curtains too, and it was dark in the room because my patient was taking a nap.

[81] And I had the TV on, and I was watching a detective show.

[82] They showed a scene of three cop cars with their lights going on the television.

[83] and I suddenly felt nauseous and I felt like I need to splash some water on my face and I got up and don't remember making it to the bathroom and apparently the strobe effect from the cop car lights on the television just struck something in my central nervous system that caused me to have a seizure.

[84] Did these seizures keep happening to you?

[85] The seizures, they came back.

[86] They definitely, they continued, and they got worse and worse.

[87] It changed everything, but I at times couldn't even trust myself to walk across the living room floor.

[88] Her life is really devolving.

[89] Her husband has to take care of both her and their kids.

[90] I did not go back to work after that.

[91] I couldn't work.

[92] It takes a long time for the doctors to figure out what's going on.

[93] There were times when there were multiple emergency room visits every week.

[94] And the medical bills, while they're trying to figure this out, just start piling up, bill after bill.

[95] It stripped a lot of my dignity away for a long time.

[96] She's diagnosed with epilepsy, so she at least knows what this is, but the doctors are still struggling to figure out medications that are going to work to control the seizures.

[97] After the seizure started, paying my student loan was definitely not at the top of my priority list.

[98] among medical bills and electric bills and, you know, living, the student loan was not at the top of my priority list.

[99] So, you know, I just, honestly, I kind of started ignoring it.

[100] I just started saying, well, you know, that's not the most important.

[101] I've got huge medical bills.

[102] This is not the most important thing in my life right now.

[103] And it wasn't.

[104] Right.

[105] So about nine months after.

[106] after not paying toward the student loan at all, I received notification.

[107] It was a really official court -looking paperwork, like something signed by a judge or something.

[108] It looked really official and really, you know, scary.

[109] And it said your nursing license is suspended until you've caught up your student loan until your debt has been satisfied.

[110] This letter, this official -looking letter, it says that because you haven't paid your loans, that your nursing license is being suspended.

[111] Yeah.

[112] Did you even think that was possible?

[113] Not at all.

[114] What are we talking about exactly here?

[115] What's the larger story of what's going on?

[116] To understand the story, you have to understand that student loans now are at a crisis point.

[117] We've all heard the numbers on student loan debt, roughly a trillion dollars and growing.

[118] There is more student loan debt that there is credit card debt, car loan debt.

[119] I mean, this is insane.

[120] Cripling young people and older people too.

[121] Going to college is the most important thing folks can do to enter the middle class, but sadly it's never been more expensive.

[122] And we have to address the massive cost of going to college.

[123] A number of states, they have tried to figure out ways to get students to repay.

[124] those loans.

[125] So 19 states have passed laws that allow them to seize, suspend, or put on hold the professional licenses, which basically, when I say professional license, I mean your ability to work.

[126] In this country, so many people have to get a license to do their job.

[127] Firefighters, nurses, teachers, lawyers, massage therapists, barbers, psychologists, even real estate brokers have all had their credentials, suspended or revoked.

[128] Cosmetologists now are impacted, hairdressers, a whole range.

[129] What's the goal here exactly?

[130] What's the intention of this policy?

[131] It sounds very backwards in a way.

[132] You're taking away a person's ability to earn a living and therefore their ability to pay back the student loan.

[133] Proponents say this is the best way to scare people into prioritizing the fact that they need to pay their student debt.

[134] So the idea is they've experimented with lots of different ways of getting borrowers to repay their money, whether it's filing lawsuits, putting liens on their homes.

[135] There are a lot of different tools in this broader collection arsenal.

[136] But one of the most powerful some of these states have found is to threaten borrowers' livelihoods, which is what you do when you put their license in jeopardy.

[137] Jessica, why would any state do this?

[138] Why would a state see its rule as getting involved in taking away someone's professional license because they owe money to a bank?

[139] Believe it or not, this whole phenomenon starts in like 1965.

[140] This is a proud moment in my life.

[141] And Lyndon Johnson, president at the time, wants to encourage more people to go to school.

[142] We're in a post -war period.

[143] There's like a feeling of euphoria.

[144] Everyone's supposed to have an education.

[145] And so...

[146] For the individual...

[147] education is the path to achievement and fulfillment.

[148] He passes this higher education act.

[149] He signs it into law.

[150] And what that basically did, it created these financial incentives for people to go to college.

[151] For it is education that places reason over for it.

[152] And banks were making the loans.

[153] And in order to encourage banks to make that, the government said, don't worry, if a student falls behind, you don't have to worry about it, bank.

[154] you're not going to take the loss, it'll be us.

[155] We'll step in.

[156] And the way that this program worked is it really fell to the states to be that backstop.

[157] So like a parent might be a guarantor on an apartment and student leaves, the parent will pay that bill.

[158] Similar thing is in play in the states.

[159] So if I've borrowed money from the state and I fall behind, the state and ultimately the taxpayer is going to be the one that steps in.

[160] So you can understand from a state's perspective that it would be in the state's interest and ultimately the taxpayers' interest to aggressively try to collect this debt from students.

[161] How common is it that lenders are getting people to start paying back their loans after they make this last -ditch threat?

[162] So states have found it's pretty successful in getting people to pay back their loans.

[163] In South Dakota, they've already collected $3 .3 million since last year.

[164] And they're a relatively recent example because some of these.

[165] laws have been on the books for many, many, many years, but South Dakota uniquely passed this law just in 2015.

[166] So this actually works as kind of cruel and counterintuitive as it sounds to take away people's licenses, their ability to actually do the work that would help them pay back the loan.

[167] This threat succeeds.

[168] It has, yeah.

[169] Once someone loses a professional license because they are behind in their student loans, can they get it back?

[170] And can they get it back easily?

[171] It's tough, actually.

[172] There are all these licensing fees as well.

[173] So in addition to the student loan costs, sometimes you have to retake the licensing exam.

[174] So it's not always that simple.

[175] Did Shannon Otto get her nursing license back?

[176] She did not.

[177] I'll always feel the need to be a nurse.

[178] because that was my true calling.

[179] But it really seems impossible.

[180] You've been able to get these seizures under control.

[181] Yeah, and I didn't waste any time going back to work.

[182] What are you doing for work today?

[183] I work alongside my husband.

[184] I'm a line cook at a very well -known bar and grill in Nashville, the Gold Rush.

[185] I really love what I'm a guy.

[186] I do.

[187] I can still nurture people only in a different way.

[188] I cook for them.

[189] I don't make nearly as much money as I would nursing, but I am grateful to have the ability to work.

[190] You have this job now at a restaurant, and your epilepsy is manageable.

[191] It sounds like, have you been able to make enough money to pay back any of these student loans?

[192] No. I mean, I work part -time, and I pay a mortgage at home.

[193] I take care of two children alongside my husband.

[194] If I had the money to pay them off, I would.

[195] And it's really not that much left to pay on the loans.

[196] $2 ,600 is all that's left.

[197] Wow.

[198] There will be people who listen to this who will feel tremendous sympathy for what, what, you know, you've been through, but may think to themselves, you signed a document, you made a promise, and if you're earning any money at any point, you just got to make a payment.

[199] And I wonder what you would say to those people.

[200] Well, they're right.

[201] I did sign a document, and I did make a promise.

[202] And I'm sure at some point in my life, before I pass away, I'll pay that student loan off.

[203] And that's what I'd have to say about that.

[204] At the end of the day, who do you blame for all of this?

[205] Honestly, I can't blame anyone but myself.

[206] I was the one that didn't pay my student loans.

[207] So I'm paying the price.

[208] Shannon, I want to thank you for your time.

[209] I really appreciate it.

[210] Thank you so much.

[211] You have a wonderful day.

[212] Here's what else you need to know today.

[213] With that, we will call the vote.

[214] Commissioner Clyburn.

[215] I dissent.

[216] Commissioner O 'Reilly.

[217] I. Commissioner Carr?

[218] Aye.

[219] Commissioner Reessel.

[220] I dissent.

[221] The chair votes aye.

[222] The item is adopted with editorial privileges granted as requested.

[223] Thanks to the staff for your terrific work on this item.

[224] On Thursday afternoon, as expected, the Federal Communications Commission voted three to two along party lines to repeal net neutrality rules put in place under the Obama administration.

[225] FCC chairman Ajit Pai, who was appointed by President Trump and championed the repeal, says the rules meant to protect an open Internet are, in fact, stifling it.

[226] Now, many words have been spoken during this debate, but the time has come for action.

[227] It is time for the Internet once again to be driven by engineers and entrepreneurs and consumers rather than lawyers and accountants and bureaucrats.

[228] It is time for us to act.

[229] to bring faster, better, and cheaper internet access to all Americans.

[230] It is time for us to return to the bipartisan regulatory framework under which the internet flourished prior to 2015.

[231] It is time for us to restore internet freedom.

[232] And the Walt Disney Company says it has reached a deal to buy most of 21st Century Fox, the television and film empire, controlled by Rupert Murdoch, in a $52 billion deal.

[233] Disney had already announced an ambitious plan to introduce video streaming services by 2019.

[234] The acquisition of 21st Century Fox and its content marks the biggest counterattack yet by a traditional media company against the tech giants like Netflix, Apple, and Amazon that have moved aggressively into the entertainment business.

[235] The Daily is produced by Theo Balcom, Lindsay Garrison, Rachel Quester, Annie Brown, Andy Mills, Christopher Worth, Ike's Conneraja, Claire Tennis Sketter, and Paige Cowan, with editing help from Larissa Anderson.

[236] Lisa Tobin is our executive producer.

[237] Samantha Hennig is our editorial director.

[238] Our technical manager is Brad Fisher, and our sound engineer is Peter Sale.

[239] Our theme music is by Jim Brunberg and Ben Landsberg of Wonderly.

[240] Special thanks to Sam Dolnik and Michaela Bouchard.

[241] That's it for the Daily.

[242] I'm Michael Barbaro.

[243] See you on Monday.