Where Does Biden’s Unfair Student Loan Forgiveness Stand?

Secretary of Education Miguel Cardona.

President Biden’s continued pattern of executive overreach is back in the spotlight. Over the last two years, the Biden White House has issued successive executive orders instructing his Department of Education to pause collection of federal student loan payments. During the 2020 campaign, Joe Biden pledged to cancel $20,000 of federal student loan debt per person, which would wipe out a vast majority of outstanding loans. Now, two separate cases revolving around the executive acts have been joined and taken up by the Supreme Court, which heard oral arguments this month from U.S. Solicitor General Elizabeth Prelogar on behalf of the Biden Administration and six Republican-led state solicitor generals who are challenging the Executive Branch’s authority. Following several hours of back-to-back arguments from both sides, there were some interesting and surprising moments. So where does Biden’s unfair student loan forgiveness plan stand now? Here are the key takeaways from the latest Supreme Court hearing and what to expect next.

The legal premises before the nine justices are twofold: 1) whether or not states have the ability to challenge administration policies they disagree with, and 2) the scope of executive authority under the Higher Education Relief Opportunities for Students (HEROES) Act, which the White House cited before the Supreme Court. The responses revealed insights into each justice’s approach to the cases.

Chief Justice John Roberts questions the estimated $400 billion price tag and far-reaching impact – some 50 million Americans – and whether those figures fit the definition of the HEROES Act which gives the Education Secretary the authority to “waive or modify” existing loans and payments. Meanwhile, Justice Clarence Thomas argued that the actions amount to “a cancellation of $400 billion in debt,” which “in effect, this is a grant of $400 billion, and it runs headlong into Congress’s appropriations authority,” he said. Other conservatives on the court, such as Justices Brett Kavanaugh and Samuel Alito, pushed back on the Biden Administration arguments in a masterful way. “Some of the biggest mistakes in the Court’s history were deferring to assertions of executive emergency power. Some of the finest moments in the Court’s history were pushing back against presidential assertions of emergency power,” Justice Kavanaugh said, in reference to the Biden Administration’s defense that the COVID-19 pandemic allows them the emergency powers now that the pandemic is over.

Meanwhile, Justice Alito dissected the Education Secretary’s actions by calling into question the White House’s decision-making after two borrowers in the case weren’t granted the full $20,000 in debt relief as were other debt-forgiveness applicants. “All right. I’ll try one more time. Why was it fair to the people who didn’t get arguably comparable relief?” Alito questioned.

The responses from the court’s conservative majority indicate that President Biden’s efforts to unilaterally cancel federal student loan repayments are on shaky constitutional ground.

Now that oral arguments have concluded, the fate of student loan amnesty now rests in the hands of the nine justices. Expect them to conference among themselves over the next 2-3 months, going back and forth on a draft opinion. While technically the Supreme Court has the ability to release its decision anytime, it is likely a final ruling won’t be made public until May or June, at which point borrowers will know the fate of their student loans. Provided that the SCOTUS decision is released before June 30th, the pandemic repayment pause will expire 60 days after the decision is announced to approve or end President Biden’s plan.

Unsurprisingly, radical Democrats are openly calling for additional forgiveness of student loan debt should the Supreme Court uphold Biden’s plan. “Millions of people, you know, even though $10,000 or $20,000 is like lowering their balance, it’s not actually lowering their monthly payment, which is why we’re still pushing — well, why would we still be pushing — for cancellation. I think that’s really important, so we’ll be pushing for more cancellations,” Braxton Brewington, press secretary for the Debt Collective, said.

Should the Supreme Court strike down the Biden Administration’s attempt to cancel federal student loan repayments, the White House has a few paths to pursue. One would be to provide a legislative fix, but with a Republican House and Democrat Senate that is the least likely outcome in the near future. Second, President Biden could follow the advice of Senate Majority Leader Chuck Schumer (D-NY), Sen. Elizabeth Warren (D-MA) and other Senate Democrats who urged President Biden in a 2021 letter to use the Higher Education Act (HEA) “to cancel up to $50,000 in student loan debt for all borrowers. The 1965 law allows for student loan relief for certain groups, including those whose institutions have since closed,” The Hill reported. “Congress has already granted the Secretary of Education the legal authority to broadly cancel student debt under section 432(a) of the Higher Education Act of 1965 (20 U.S.C. 1082(a)), which gives the Secretary the authority to modify, ‘… compromise, waive, or release any right, title, claim, lien, or demand, however acquired, including any equity or any right of redemption,’” the Democrats letter stated.

Should the Biden Administration’s arguments based on the HEROES Act fail before the Court, the administration could act unilaterally under the Senate Democrats’ interpretation of the HEA. In that scenario, lawsuits would surely be filed challenging that authority, and the Biden administration would wind up back in front of the Supreme Court in a year’s time.

While we await the conclusions, Americans will continue to call into question the White House’s case that the COVID-19 pandemic should continue to be an excuse, now even after President Biden himself admits that it is over, as a way to further burden American taxpayers who just shouldered over $6 trillion dollars in so-called “emergency relief” spending by Washington Democrats in the last 3 years. Surely, Supreme Court justices will be questioning that very line of thinking among others recently revealed in the latest round of arguments.

Bob Carlstrom is President of AMAC Action

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