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The Morehouse debt cancellation and the growing black student debt crisis

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The Morehouse student debt story has a happy ending. It still highlights a serious problem.
The graduating class at Atlanta’s historically black Morehouse College got the surprise of a lifetime on Sunday when commencement speaker and billionaire Robert F. Smith announced that he wasn’t just there to give the nearly 400 graduating seniors a nice motivational speech — he was also going to pay off their student debt.
“On behalf of the eight generations of my family that have been in this country, we’re gonna put a little fuel in your bus,” Smith, the founder of the investment firm Vista Equity and the richest black person in the United States, told the newest graduates of the prestigious all-male college. “This is my class, 2019. And my family is making a grant to eliminate their student loans.”
Morehouse administrators have said that the exact cost of Smith’s gift is still being calculated, but early estimates have placed the amount at somewhere near $40 million. Even without an official figure, the gift marks the single largest donation ever made to an HBCU (historically black college and university), and Morehouse’s 2019 graduates quickly praised the donation as life-changing.
“This lifts a huge weight off my family’s back,” Deionte Jones, a 22-year-old 2019 Morehouse graduate with $25,000 in debt, told the Washington Post.
@RFS_Vista May have broken the Internet with his generosity and charge to pay it forward. https://t.co/6dsfw2kToi
Smith’s gift comes as America’s student debt crisis is attracting increased attention from education policy experts, economists, and candidates in the 2020 Democratic primary.
And the fact that Smith, a black man with a net worth of nearly $5 billion, pledged to pay off the debts of hundreds of young black college graduates carries a powerful message about the transformative power of black wealth and how that wealth can create opportunities particularly for black students — who are more likely than other groups to face high levels of student debt.
That the gift was presented at one of America’s most prominent HBCUs, institutions with rich cultural and social history that are currently under increased financial strain, only adds to the symbolism.
For generations, HBCUs — which were created to serve black students barred from attending white institutions in the years after the collapse of slavery — have been one of the most significant contributors to the black middle class; a large number of America’s black doctors and lawyers have attended HBCUs.
These institutions also have a rich connection to black history, with schools like Morehouse often highlighting the attendance of prominent figures like Martin Luther King Jr. and director Spike Lee.
But in recent years, many of these institutions have been thrust into a serious financial crisis as schools deal with falling enrollment and increased operating costs.

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