Supreme Court Weighs Fate of Biden Student Loan Forgiveness Program
The Supreme Court heard arguments this week in two cases challenging President Joe Biden’s plan to wipe out more than $400 billion in student debt for approximately 40 million Americans. The court is considering the constitutionality of Biden’s student loan forgiveness program, which proposes to cancel up to $10,000 in federal student-loan debt for borrowers earning up to $125,000 per year ($250,000 for married couples), and up to $20,000 for those with Pell Grants.
The hearing focused mainly on the states’ claims that the loan forgiveness program’s potential harms to MOHELA – the Missouri-created entity that services loans in the state – gives Missouri standing, as well as the doctrine of judicial overreach. The justices also questioned whether the plan was something Congress should have acted on, with Chief Justice John Roberts noting that, “We’re talking about half a trillion dollars and 43 million Americans.”
Justice Sonia Sotomayor cut through the legal complexity to point out the problems with the case: It ignores the vast advantages of generational wealth when it comes to paying for education and the hardship that borrowers without financial help will face if the program is cancelled. She also noted the urgent need for this type of aid, saying, “There are 50 million students who will benefit from this who today will struggle…Their financial situation will be even worse because once you default the hardship on you is exponentially greater.”
The Biden administration has asserted that the HEROES Act, a current law, allows the secretary of education to alter or suspend any statutory or regulatory rule concerning student financial assistance plans if the secretary believes such action is required to prevent borrowers from being negatively impacted financially. On the other hand, conservative justices have devised a tool to wriggle out from under the text of a law: the “major questions doctrine,” a dubious and ill-defined rule that courts can use to strike down any policy that presents a “major question” if Congress has not authorized it explicitly enough.
Ultimately, the Supreme Court’s decision in these two cases will have enormous practical consequences and will determine the fate of millions of student loan borrowers.
0. “Supreme Court Appears Skeptical of Student Loan Forgiveness” Barron's, 28 Feb. 2023, https://www.barrons.com/articles/student-loan-debt-supreme-court-case-91c63d58
1. “‘We need to stop the cycle:’ Student loan borrowers detail what forgiveness would mean” Yahoo News, 28 Feb. 2023, https://news.yahoo.com/we-need-to-stop-the-cycle-student-loan-borrowers-detail-what-forgiveness-would-mean-200529453.html
2. “5 key moments from the Supreme Court showdown over Biden's student debt relief” POLITICO, 1 Mar. 2023, https://www.politico.com/news/2023/02/28/5-moments-supreme-court-student-debt-00084882
3. “Sonia Sotomayor Just Nailed the Problem With the Student Debt Cancellation Challenge – Mother Jones” Mother Jones, 28 Feb. 2023, https://www.motherjones.com/politics/2023/02/sonia-sotomayor-student-debt-cancellation-supreme-court-scotus/
4. “The liberal justices had a strong game plan going into the student loan case. Did they win over Barrett?” CNN, 28 Feb. 2023, https://www.cnn.com/2023/02/28/politics/barrett-sotomayor-kagan-jackson-supreme-court-oral-arguments/index.html
5. “Opinion | Yes, the Heroes Act authorizes student debt cancellation” The Washington Post, 22 Feb. 2023, https://www.washingtonpost.com/opinions/2023/02/22/student-debt-cancellation-congress-heroes-act
6. “Student debt oral arguments: It went better than expected for Biden.” Slate, 28 Feb. 2023, https://slate.com/news-and-politics/2023/02/student-debt-oral-arguments-better-than-expected.html
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