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Resolution on Student Loans and the Economy

WHEREAS, the League of United Latin American Citizens is committed to improving the economic condition, educational attainment, political influence, housing, health and civil rights of the Hispanic population of Florida; and,

WHEREAS; according to a recent report from the Pew Hispanic Center, Latino youth now represent the largest minority group in K-12 U.S. schools and are the fastest growing segment of students but Latino college completion stands at just 19.2 percent—far below the national average of 41.1 percent; and,

WHEREAS; for the first time in the nation's history Latino children make up the majority of the nation's poor children, with an estimated 6.1 million Latino children (37.3 percent) in the U.S. living in poverty in 2010, compared with 30.5 percent of white children and 26.6 percent of black children; and,

WHEREAS; the costs of higher education have sky-rocketed, with average in-state tuition and fees at four-year public colleges 8.3 percent higher over the past year and tuition at public four-year universities more than doubled over the past decade; at the average private four-year institution, tuition, room and board, books, transportation and other expenses total $42,224 a year, about equal to the declining median family income; and,

WHEREAS; according to the National Center for Education Statistics (NCES) 10-year follow-up on the debt status of students who graduated from college during the 1992-93 school year, Hispanic students' overall default rate was over twice that of White students and four times higher than Asian students; and ,

WHEREAS; those with the highest amounts of debt or the lowest salaries, as well as black and Hispanic students, all have default rates well over 9.7 percent and at each default, collection costs of up to 40 percent of the loan balance are added to the loan plus any unpaid interest; and,

WHEREAS; interest rates on federal student loans are set to double to 6.4% on July 1 unless Congress steps in and for each year that Congress allows the rate to double, the average student with these loans racks up an additional $1,000 in debt; and,

WHEREAS; student loans are the only loans in history to be exempted from bankruptcy protections and are the only loans denied standard consumer protection; and,

WHEREAS; Rep. Hansen Clarke introduced H. Res 365, a resolution calling on Congress to forgive student loan debt as a means of economic stimulus; and,

WHEREAS; household wealth among Latinos declined more sharply than either black or white households between 2005 and 2009; and,

WHEREAS; according to the U.S. Department of Agriculture, food insecurity among Latino households increased sharply at the start of the Great Recession, with nearly a third (32.1 percent) of Latino households with children facing food insecurity in 2008, up from 23.8 percent in 2007; and,

WHEREAS; Latinos nationwide were more than twice as likely as non-Hispanic whites to receive "higher-priced" loans when buying or refinancing a home, during the boom and the subsequent bust, and wound up with a disproportionate number of the high-risk, high-interest loans known as subprime mortgages; and

WHEREAS; according to the Orlando Sentinel, although Latinos received one-fourth of all the residential mortgages granted in Central Florida two years ago, they wound up with one-third of the region's subprime loans— and more than 40 percent of the worst-of-the-worst subprimes; and,

WHEREAS; foreclosures have disproportionately affected Hispanic families, including nearly half of the all the foreclosures in California between September 2006 and October 2009 (48 percent), according to National Association of Hispanic Real Estate Professionals; and,

WHEREAS; Fortune's "IRS Enforcement's Impact on Minority Communities" identifies a disproportionate number of IRS actions against low-income minorities; and

WHEREAS; according to U.S. Department of Labor reports released September 2, 2011, the unemployment rates for Hispanics is 11.3 percent compared to the overall unemployment rate unemployment rate of 9.1 percent and 14.1 million unemployed Americans are in no position to spend; and,

WHEREAS; The U.S. economic recovery will remain slow deep into next year, held back by shoppers reluctant to spend and employers hesitant to hire, with July 2011 consumer expenditures 1.6 percent below their pre-recession peak;

THEREFORE BE IT RESOLVED, that LULAC applauds the Executive Actions taken to provide relief to those suffering under the burden of heavy debt and low.

Approved this 30th day of June 2012.

Margaret Moran
LULAC National President