Legal Scrutiny Clouds Biden’s Backup Plan for Student Debt Relief as Supreme Court Decision Lingers

President Joe Biden’s backup plan for delivering student debt relief is likely to face legal scrutiny, according to experts. The plan, which was announced after the Supreme Court ruled against Biden’s initial proposal, raises questions about the administration’s ability to fulfill its campaign promise without the support of Congress.

The Supreme Court’s ruling stated that Biden exceeded his authority when he used the HEROES Act to forgive up to $20,000 in student debt. In response, Biden announced that he would pursue debt relief under the Higher Education Act of 1965, describing it as “legally sound” but acknowledging that it would take longer to implement.

The HEROES Act allowed the secretary of education to “waive or modify” loan terms, while the Higher Education Act permits the administration to “compromise” loans and forgive them in specific circumstances. However, the “compromise” language has traditionally been understood to give the department the power to reduce loans on a case-by-case basis, rather than as a blanket authority to forgive debt.

Experts have raised concerns about whether a similarly sweeping debt relief program would be supported under the Higher Education Act. They argue that the court is unlikely to reach a different result under language that is very similar to the HEROES Act.

Biden’s new proposal has not provided specific details, but he described it as “the best path that remains to providing for as many borrowers as possible with debt relief.” Some experts suggest that the administration could craft a narrower program to withstand legal scrutiny, although this may draw criticism from liberals within the party.

Supporters of Biden’s latest effort argue that the Higher Education Act clearly outlines the administration’s power to forgive debt. They point out that the provision of the law in question does not include limiting language, and therefore covers the actions that the secretary is contemplating.

The Supreme Court’s conservative majority has become increasingly skeptical of significant policies from federal agencies that do not have explicit approval from Congress. In previous cases, the court has ruled that certain actions exceeded the authority granted by Congress.

It remains to be seen how the administration will proceed with its debt relief plan and whether it will withstand legal scrutiny. The Higher Education Act does authorize certain forms of relief in specific situations, such as for borrowers who were defrauded by for-profit colleges.

What specific challenges could arise in implementing President Biden’s backup plan for delivering student debt relief under the Higher Education Act, considering the Supreme Court’s ruling on his previous proposal?

Legal challenges are likely to arise regarding President Joe Biden’s backup plan for delivering student debt relief, experts say. The plan, announced after the Supreme Court rejected Biden’s initial proposal, raises concerns about the administration’s ability to fulfill its campaign promise without congressional support.

The Supreme Court ruled that Biden exceeded his authority by using the HEROES Act to forgive up to $20,000 in student debt. In response, Biden stated that he would pursue debt relief under the Higher Education Act of 1965, considering it “legally sound” but recognizing that implementation would take longer.

While the HEROES Act allowed the secretary of education to “waive or modify” loan terms, the Higher Education Act permits the administration to “compromise” loans and forgive them in specific circumstances. However, the “compromise” language has traditionally been interpreted as granting the department the power to reduce loans on a case-by-case basis rather than forgiving debt wholesale.

Experts question whether a similar debt relief program would be supported under the Higher Education Act. They argue that the court is unlikely to reach a different conclusion when the language closely resembles that of the HEROES Act.

Although Biden’s new proposal lacks specific details, he described it as “the best path that remains to providing for as many borrowers as possible with debt relief.” Some experts suggest that the administration could design a more limited program to withstand legal scrutiny, but this may face criticism from liberal factions within the party.

Supporters of Biden’s latest effort maintain that the Higher Education Act clearly grants the administration the power to forgive debt. They emphasize that the relevant provision of the law does not include restrictive language, thereby covering the actions contemplated by the secretary.

The Supreme Court’s conservative majority has exhibited growing skepticism towards significant policies from federal agencies lacking explicit approval from Congress. In past cases, the court has determined that certain actions exceeded the authority given by Congress.

The fate of the administration’s debt relief plan and its ability to withstand legal scrutiny remains uncertain. The Higher Education Act does authorize certain forms of relief under specific circumstances, such as for borrowers defrauded by for-profit colleges.