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Joe Biden for President? Media Buzz Ignores How Veep Worsened Student Debt on Big Banks’ Behalf

StoryOctober 20, 2015
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Washington is abuzz with rumors Vice President Joe Biden will soon enter the race for the Democratic presidential nomination. While a new campaign would seek to capitalize on Biden’s two terms as vice president, it would also invite scrutiny of his Senate record in a Democratic political climate notably more progressive today than it was when Biden last sought the nomination. Biden’s 1994 crime bill, while implementing sweeping gun control, also helped fuel mass incarceration with financial incentives to keep people behind bars. Biden is also known for close ties to the financial industry, notably helping push through a 2005 bill that made it harder for consumers to declare bankruptcy. According to The New York Times, the credit card issuer MBNA was Biden’s top donor from 1989 to 2010. Now, as speculation over Biden’s presidential aspirations reaches a fever pitch, the Obama administration is seeking to repeal one of his key legislative achievements. The White House wants to undo a provision in the 2005 bankruptcy law that made it harder to reduce student debt, preventing most Americans from claiming bankruptcy protections for private student loans. The administration’s effort follows the publication last month of an International Business Times exposé by David Sirota, “Joe Biden Backed Bills to Make It Harder for Americans to Reduce Their Student Debt.” Sirota discusses Biden’s role in passing the legislation.

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Transcript
This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: Well, Washington is abuzz with rumors that Vice President Joe Biden will soon enter the race for the Democratic presidential nomination. Biden has huddled with key advisers while putting out feelers to potential staffers and supporters. The speculation has increased since August, when New York Times columnist Maureen Dowd reported Biden’s son, Beau Biden, urged his father to run before dying of cancer earlier this year. This month, Politico reported Dowd’s source for the story was Joe Biden himself. A longtime Democratic senator from Delaware, Biden previously ran twice for the Democratic nod. The last time was in 2008, when he ultimately became then-Senator Barack Obama’s running mate.

While a new campaign would seek to capitalize on Biden’s two terms as vice president, it would also invite scrutiny of his Senate record in a Democratic political climate that’s notably more progressive today than it was when Biden last sought the nomination. Biden’s 1994 crime bill, while implementing sweeping gun control, also helped fuel mass incarceration with financial incentives to keep people behind bars. Biden is also known for close ties to the financial industry, notably helping push through a 2005 bill that made it harder for consumers to declare bankruptcy. He represented the state of Delaware. According to The New York Times, the credit card issuer MBNA was Biden’s top donor from 1989 to 2010.

Now, as speculation over Biden’s presidential aspirations reaches a fever pitch, the Obama administration is seeking to repeal one of his key legislative achievements. The White House wants to undo a provision in the 2005 bankruptcy law that made it harder to reduce student debt, preventing most Americans from claiming bankruptcy protections for private student loans. In its bid to rescind the measure, the Department of Education says Biden’s legislation left, quote, “private student loan borrowers in financial distress with few options.” The administration’s bid to repeal the student bankruptcy provision follows the publication last month of an exposé by our next guest, David Sirota, who wrote a piece for the International Business Times headlined “Joe Biden Backed Bills to Make It Harder for Americans to Reduce Their Student Debt.” David Sirota joins us now from the studios of Denver Open Media in Denver, Colorado.

Hi, David. Just lay out Joe Biden’s record on student debt, and then go beyond.

DAVID SIROTA: Joe Biden has been working on bankruptcy legislation for the last three decades. He got into the Senate in the 1970s. He was on the Judiciary Committee. There began to be a push in the 1970s to reduce courts’ ability to lower student debt in bankruptcy court, starting in the 1970s. It started with government loans. There was a push in the 1970s to say that students would have to wait five years from graduating to be able to seek bankruptcy protections for their government loans. That was a bill that Joe Biden helped craft. He was on the conference committee. There was a series of other bills through the 1980s and into the 1990s in which Joe Biden worked on the same set of issues, lengthening the amount of time students would have to wait to be able to access bankruptcy protections for educational debt. And then, as you noted, into the late 1990s and the 2000s, there was this push by Biden—he was a key Democrat pushing the bankruptcy bill that was ultimately signed by President George W. Bush that eliminated the ability of most Americans to seek bankruptcy protections not only for their government loans, but also for their private student loans. So that was a big—a big objective of the private lenders. At the time, over his career, Joe Biden has raised about $2 million from the financial sector, while he’s been sculpting these bills. And again, he played the key role throughout the last three decades in the Democratic Party—really, in Congress—pushing these bills. Elizabeth Warren issued a paper, when she wasn’t in the Senate, when she was a professor, talking about how pivotal Joe Biden was in pushing these laws to, again, make it more difficult for students to reduce their student debt when they are in bankruptcy court. It really puts a prohibition on the judges themselves, saying you really can’t lower student debt, like you can most other forms of debt, when you are in bankruptcy court.

AMY GOODMAN: So, talk about Vice President Biden’s influencing of President Obama on this and where they both stand.

DAVID SIROTA: Well, it’s a great point. In 2008, the bankruptcy bill, the most recent bankruptcy bill, became a flashpoint in the debate for the Democratic nomination and then in the general election. Obama had voted against that most recent bankruptcy bill making it harder to declare bankruptcy—Biden, of course, one of the chief proponents of it. And Biden stood by his position. He was asked about it in a debate. He simply said that the then-Senator Obama and he disagreed on the bill. Biden has—subsequently, while being in the administration, has not really taken much of a position on whether to rescind the parts of the bill dealing with student debt, even though the administration itself, as you mentioned, very recently, said it wants to rescind some of those provisions. So Biden has been silent. His office told us that he supported studying the issue. So it will be interesting to see if he runs for president and if he’s asked about this huge issue. And I should say all the Democratic candidates have been talking about student debt, so I expect he will be asked about this issue.

AMY GOODMAN: You know—

DAVID SIROTA: If he’s asked, we don’t know where he is.

AMY GOODMAN: David Sirota, you know, there is nonstop talk about Joe Biden now—”bidin’ his time,” etc., right? Everyone is talking about whether he will enter the race. But there is almost no discussion of what his actual record is. Where does he stand in relation, for example, to Bernie Sanders? Where does he stand in relation to Hillary Clinton? Assess, overall, his record. Go back to Anita Hill.

DAVID SIROTA: Yeah, well, Joe Biden has a very long record. He was a controversial figure in the Anita Hill hearings. He has pushed a lot of crime bills that made it—kind of pushed mass incarceration, a tough-on-crime rhetoric. He is a guy who has close ties to the financial sector, and he supported bank deregulation. The key here, though, is there’s been an argument from his side, which is to say that his record in the Senate, representing Delaware, where there are a number of financial institutions—the argument from some of his supporters is that that’s a different record than since he’s been in the administration heading up the administration’s Middle Class Task Force, talking a lot about issues, for instance, like student debt. He’s talked a lot about how we have to reduce student debt. So, one of the questions is: Which Joe Biden will show up if he runs in 2016? The guy in the administration or the guy who spent 30 years in the Senate working, in many cases, with some of the most powerful political forces in corporate America that there are?

AMY GOODMAN: His position on the Iraq War, David?

DAVID SIROTA: Right. I mean, this is a guy who—well, I mean, you know, the issue is, is that he’s been, in some cases, on a lot of sides of the issue. I mean, he has been a guy who has been supportive of continuing the war. He has been—and I think that will be a contrast point potentially with Bernie Sanders, Hillary Clinton, as well. And I should also say, we don’t know how the debate is going to be between Hillary Clinton and Joe Biden. Hillary Clinton has similarly been on both sides of a number of issues. The Iraq War is an example. The bankruptcy bill—Hillary Clinton voted for one version of the bankruptcy bill, she voted against another version of the bankruptcy bill. So it will be very difficult to know how the flashpoints are going to play out in the race.

AMY GOODMAN: Well, I want to thank you very much for being with us, David Sirota, senior writer at the International Business Times. His recent piece, we’ll link to it, is headlined “Student Debt: Obama Administration Tries to Block Bankruptcy Courts from Reducing Education Debt.”

And that does it for our show. We have an opening, a full-time job as director of development to lead our fundraising efforts. Find out more about our development director job at democracynow.org.

The original content of this program is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 United States License. Please attribute legal copies of this work to democracynow.org. Some of the work(s) that this program incorporates, however, may be separately licensed. For further information or additional permissions, contact us.

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