President Joe Biden’s alternative approach to addressing the issue of student debt relief is expected to encounter legal challenges, similar to his initial plan that was recently rejected by the Supreme Court. Experts have expressed concerns about the administration’s ability to fulfill Biden’s campaign promise without congressional support.
The Supreme Court’s ruling of 6-3 determined that Biden had exceeded his authority by utilizing the HEROES Act of 2003 to forgive up to $20,000 in student debt. In response to this decision, the president announced a new strategy, pursuing debt relief under the Higher Education Act of 1965, which he believes is legally sound but may take longer to implement due to the required process.
Legal Questions Surrounding Biden’s Backup Plan
The HEROES Act granted the secretary of education the power to “waive or modify” loan terms, while the Higher Education Act allows the administration to “compromise” loans and forgive them in specific circumstances, such as for individuals who become teachers. The Supreme Court’s rejection of the broad interpretation of “waive” raises doubts about the viability of a similar sweeping debt relief program under the term “compromise.”
Legal experts, including Cary Coglianese, a law professor at the University of Pennsylvania, are skeptical that the court would reach a different conclusion given the similarity of the language used in the statutes. The court has not recognized anything of such magnitude within the existing statutes.
Biden’s New Proposal and Uncertainties:
In his recent announcement, President Biden carefully phrased the scope of his new proposal, highlighting it as “the best path that remains to providing for as many borrowers as possible with debt relief.” However, the specifics of the administration’s intentions remain unclear. A public meeting has been scheduled for later this month to shed more light on the details.
The president’s initial proposal aimed to forgive $10,000 for many federal student loan borrowers and up to $20,000 for low-income Pell Grant recipients. The debt cancellation was limited to borrowers with annual incomes below $125,000 or households earning $250,000 or less. Over 26 million people applied for relief, with the administration estimating that more than 40 million Americans might be eligible.
Counter Argument: Clarity of the New Law:
Advocates supporting Biden’s new effort argue that the Higher Education Act provides a clearer outline of the administration’s authority to forgive debt. They point out that the provision of the law in question does not include limiting language suggesting that relief should be granted on a case-by-case basis. Persis Yu, deputy executive director at the Student Borrower Protection Center, asserts that the new law focuses on reducing the loan balance, and the secretary’s contemplated actions fall within its purview.
Luke Herrine, a law professor at the University of Alabama, acknowledges the skepticism the current Supreme Court holds toward mass debt cancellation. He suggests that the administration could pursue a narrower version of debt cancellation in an attempt to gain court approval. Herrine also speculates that political pressure to maintain the court’s legitimacy could influence their decision-making process.
Questioning the Authority to Relieve Debt:
The Supreme Court’s conservative majority has become increasingly wary of significant policy decisions made by federal agencies without explicit approval from Congress. Chief Justice John Roberts, in his majority opinion for the recent student loans case, argued that the “waiving” of loans described in the HEROES Act did not grant broad authority to the Department of Education for forgiving student loans. Similarly, the Higher Education Act does not explicitly address broad forgiveness and has not been interpreted as such in the past.
The court’s reasoning echoes their 2021 decision to prevent Biden from extending an eviction moratorium during the COVID-19 pandemic. In that case, the court ruled that Congress did not envision a nationwide transformation of landlord-tenant relationships when passing a public health law.
The conservative majority employed a similar argument to invalidate an Environmental Protection Agency (EPA) regulation on power plant emissions contributing to climate change. Chief Justice Roberts, writing for the majority, cited the “major questions doctrine,” allowing courts to strike down regulations that are not explicitly permitted by law in exceptional cases.
Derek Black, a law professor at the University of South Carolina, emphasizes that the Higher Education Act likely intended to grant the secretary the authority to evaluate individual borrowers and make decisions on a case-by-case basis. Black suggests that a narrower approach by the administration could withstand legal scrutiny.
President Biden’s backup plan for student debt relief faces legal scrutiny due to the limitations imposed by the Supreme Court’s ruling on the HEROES Act. Experts remain skeptical about the viability of a sweeping debt relief program under the Higher Education Act, given the conservative court’s stance.
While supporters argue that the new law provides a clearer path for debt forgiveness, concerns persist regarding the court’s interpretation and the need for congressional approval. The administration’s forthcoming public meeting aims to shed more light on the specifics of the proposal. As the legal battle continues, the fate of Biden’s campaign pledge to address student debt relief remains uncertain.
