Supreme Court Decides the Fate of Biden’s Student Debt Relief
The Supreme Court this week held a hearing that will decide the fate of the Biden Administration’s promise to forgive millions of Americans up to $20,000 in student loan debt – a plan that could cost as much as $400 billion.
In a three-hour session held Tuesday, Supreme Court Justices heard arguments from the Biden Administration and six GOP states involved in challenges against the plan. The six states are: Arkansas, Iowa, Kansas, Missouri Nebraska, and South Carolina.
Plaintiffs are largely backed by the court’s conservative majority, whereas the Biden Administration has support from the court’s three liberal justices.
Major arguments in favor of moving forward with the debt relief plan:
- States do not have legal grounds to sue because they cannot show actual harm or injury resulting from the program.
- Student loan payments were paused in March of 2020 and nobody sued over that decision.
- The federal government helped small businesses during the pandemic; why can’t it help students?
US Solicitor General Elizabeth Prelogar claims the Biden Administration’s debt forgiveness plan is legal under the Higher Education Relief Opportunities for Students Act of 2023 (HEROES Act), a law that was intended to benefit service members deployed to Afghanistan and Iraq by providing debt relief. ‘The language of the HEROES Act clearly grants the Secretary of Education the power to waive or modify federal student loan programs as deemed necessary in connection with a war or other military operation or national emergency,’ she said.
Prelogar went on to insist that lawmakers knew the HEROES Act could be used to forgive massive amounts of student debt when they approved it (a claim disputed by the opposition) and said that any action by SCOTUS to invalidate the plan would throw into question the federal government’s ability to protect Americans during a national emergency.
Major arguments against the debt relief plan:
- It’s too expensive. The plan will increase the national deficit and burden the poor and working class with taxes.
- It’s not fair. The plan will take taxpayer funds from individuals who never went to college or who paid off their loans in order to forgive the loans of others.
- It’s not legal. The plan supersedes the appropriations authority granted to Congress and violates the separation of powers doctrine the Supreme Court is supposed to uphold.
At least five of the court’s six conservative justices backed the opinion that use of the HEROES Act to cancel student debt violates the court’s 2022 “major questions doctrine,” which holds that an agency can’t make decisions of “vast economic or political significance” unless granted authority from Congress.
“If you’re talking about this in the abstract, I think most casual observers would say, if you’re going to give up that much amount of money, if you’re going to affect the obligations of that many Americans on a subject that’s of great controversy, they would think that’s something for Congress to act on,” said Chief Justice John Roberts.
Roberts took particular issue with Prelogar’s attention to the phrase “waive or modify” in relation to the use of the HEROES Act to cancel student debt. “It might be good English to say that the French Revolution ‘modified’ the status of the French nobility, but only because there is a figure of speech called understatement and a literary device known as sarcasm,” he said. “We’re talking about half a trillion dollars and 43 million Americans…How does that fit under the normal understanding of ‘modify?’”
The primary concern for plaintiffs from Missouri is the potential financial impact on the Higher Education Loan Authority of the State of Missouri (MOHELA), one of the nation’s largest holders and servicers of student loans.
Surprisingly, Trump-appointed Justice Amy Coney Barrett joined her liberal colleagues in arguing that MOHELA’s financial debts are not so intertwined with the state that it can sue on the company’s behalf. “If MOHELA is an arm of the state, why didn’t you just strong-arm MOHELA and say you’ve got to pursue this suit?” asked Barrett.
The Supreme Court will spend the next few months debating the issue before producing an opinion (hopefully a draft won’t be leaked to the press this time around). A final ruling is expected to be made public by June. As it stands, the pandemic repayment pause initiated in March of 2020 will end 60 days after the Supreme Court announces its decision.
Sources:
Top takeaways from student loan forgiveness arguments at the Supreme Court
Six States File a Challenge to the Biden Administration’s Student Loan Cancellation Program
Randi Weingarten screams about student debt outside SCOTUS: ‘That is not fair!’
I expect SCOTUS to kill this. But then I wonder how many of the borrowers will decide to vote Democratic in the next election cycle, hoping to gain a majority that will overturn SCOTUS?
A big argument against the forgiveness of student debts is that college graduates make more money than those without degrees. That’s partially true. The only real advantage to a degree is that you have more job opportunities because so many businesses demand degrees even for simple jobs. Even though I never bothered with a degree, when I worked as an electronic technician, I made as much as my co-workers with degrees, and the same applied when I worked as an engineer, manager, and IT Professional. My skillset was sufficient to command fair wages without a piece of paper from a college. If businesses tested for the necessary skills rather than depending on a piece of paper, they would probably have more applicants for the jobs, with a few being too poor to go to college. If a sufficient number of US employers adopted such a scheme, we would probably see a serious reduction in college costs, as fewer students would pay the exorbitant tuitions now being demanded.
A big argument is others paid for their college and/or their childrens’ college, why now should we pay for these students loans. Is the govt going to give those of us who paid for ours or our kids college tens of thoursands or pay our mortgages – NO? Then why should I pay for their debt. They borrowed, knowing they would have to pay back.
Forgiving their loan commitments teaches them to be dishonest – take a loan and not pay it back. You cannot do this with a house loan, a car loan, charges, etc. – try not paying anything back and see where it gets you.
Give them time. They’ll figure out, how to do that, too.
Trump learned that Bubba. And he is dishonest. You nailed it
It was a funky idea shoehorned in the back door and ripe for overturn.
As a liberal, not really big on this.
Then again, most college loan default is held by Republicans so perhaps I am wrong. I would hate to be partisan about it :>)
“Democratic States Have More Debt, But Republican States Have More Defaults.” Like 55% more. Hate to financially save those lives, they need to pay.
interesting piece on party breakdown since that’s the most important part……of everything now: *https://www.forbes.com/sites/schoolboard/2017/07/10/how-student-loan-debt-and-defaults-differ-across-red-and-blue-states/?sh=429897506c66*
FYI: Republicans are more likely to favor interest reduction, which is still just forgiveness, but hey, if it works….. I am all for a hand up, but really don’t want to cover their mistakes with a hand out.
THIS LOAN FORGIVNESS IS ALL ABOUT VOTES. BUT ANYONE VOTING FOR DEMOCRATS HAS NO LOVE FOR OUR COUNTRY.ANY NORMAL CITIZENS WATCHING HOW BIDEN IS DESTROYING THIS COUNTRY THEN STILL VOTE FOR HIM, IS REALLY FOR COMMUNISM AND SOCIALISM A LOT OF COLLEGE KIDS NEED TO LEARN HISTORY, BUT THE CARE MORE FOR FREE, FREE, FREE, THEN THEIR OWN COUNTRY. VERY SAD, IN OTHER COUNTRIES KIDS LOVE THEIR COUNTRY,WOULD DO ANYTHING FOR IT. BUT HERE IN AMERICA THERE IS JUST HATE FOR ANYTHING.
BUT STUPID CANNOT BE FIXED.
You are right about votes. And it worked.
But because of that. He rigged the process and may be caught soon.
Hopefully, he can go with Republicans and lower the interest rates.
That is what the democrat run education system does in America. They teach our kids to be deviant, sexual, petty little whiners that think everything revolves around them and everyone owes them. We need to teach them how great America is and that they have a personal responsibility to take care of themselves, and paying back a loan that THEY contracted for is THEIR responsibility. WE did not sign those contracts and WE should never be expected to pay for the ones that did.
Sure, let them declare bankruptcy and then let rhe taxpayers bail them out. Like Trump did in NJ and other places. Many times. It’s the American way and then, you too, Mr. Bankrupcy king, can become President cuz the same people who hate this , love you.
I sure hope God loves a hypocrite.
I am still against this and I was against voting for your bankruptcy god who then bankrupted us adding 25% of our national debt in only four years and then storming the Capitol to get four more. And he’s running again.so he can finish the job!!
You borrowed it, you owe it, you pay it.
MY THOUGHTS EXACTLY.