How the Supreme Court may relate to Biden’s plan for student loan forgiveness

Supreme Court Justices Ketanji Brown Jackson, John Roberts and Amy Coney Barrett are shown in front of a background pattern of stacks of money and graduation caps.

Alex Wong/Getty Images; iStock; Robyn Phelps/ Insider

  • On Tuesday, the Supreme Court will hear oral arguments on Biden’s plan for student loan relief.

  • Supporters say the relief is legal, while opponents say Biden’s policy is unconstitutional.

  • Here’s how the judges might approach the cases.

The showdown over President Joe Biden’s student loan forgiveness will play out at the Supreme Court on Tuesday in two closely watched cases that could decide whether millions of borrowers will have their debt erased.

The court’s rulings could either deal a major blow or victory to Biden, whose plan would eliminate up to $20,000 in federal loans to borrowers making less than $125,000 annually.

Court observers and lawyers on both sides plan to pay attention to the justices’ questions during oral arguments. Questions that focus on whether the parties were harmed by Biden’s debt forgiveness, for example, could indicate that the court might consider deciding the case on narrow grounds rather than ruling on the legality of Biden’s decision, legal analysts told Insider.

Supporters say Biden’s plan would provide much-needed financial relief to the 43 million Americans who took out loans for their higher education, and especially help communities that are likely to default on their debt and continue to be disproportionately affected by the COVID-19 pandemic. namely, low-income, black, Latino, and Native American.

On the other hand, opponents insist that Biden’s plan would have massive legal ramifications for the president’s authority and have economic consequences, pointing to Congressional Budget Office estimated $400 billion cost to the federal government over the next 30 years.

The arguments

The challengers — six Republican-led states and two federal borrowers — argue that Biden overstepped his authority by implementing sweeping debt relief without congressional approval.

If Congress has no say, that “would be really troubling for our ability to govern ourselves,” said Casey Mattox, vice president of legal and judicial strategy at Americans for Prosperity, a libertarian-leaning advocacy group that filed the lawsuit. backs the challengers.

“It creates a circumstance going forward where future presidents will say, ‘Well, what’s the one thing I can do to kind of, you know, help me at the polls or with a particular constituency or whatever?'” added Mattox.

The Biden administration has defended the plan as falling under the president’s legal authority, arguing that the HEROES Act, a federal law passed in the wake of the Sept. 11 terrorist attacks, allows the education secretary to waive or modify student loan balances in the middle of a citizen . emergency. In this case, it is the COVID-19 pandemic.

“The damage of the COVID-19 pandemic continues,” said Pilar Whitaker, special economic justice advisor at the Legal Defense Fund. “This relief is appropriate and tailored to those who need it most.”

How the court could approach the cases

The Supreme Court will review two questions: whether the challengers have standing — the power to block Biden’s relief by showing they suffer harm from it — and whether the plan exceeds the administration’s power.

South Texas College of Law professor Josh Blackman predicts the justices will focus plenty of their questions during oral arguments on standing, which could determine whether challengers succeed or have their bids thrown out.

“The unique thing about this policy is that you’re not hurting people. You’re doing the opposite. You’re helping them, you’re eliminating their debt,” Blackman said. “So the parties have to be creative about standing here, which is really the biggest hurdle.”

In the first case, which the justices will hear on Tuesday, the GOP-led states – Arkansas, South Carolina, Iowa, Kansas, Nebraska and Missouri – argue that Biden’s relief would hurt their tax revenues, along with the revenues of the Missouri-based student loan company, MOHELA. The states argue that MOHELA will lose loan servicing revenue because of Biden’s relief.

Yet the Biden administration say the states lack standing because they can only assert “alleged damages”—not actual—and MOHELA is not part of their lawsuit.

The Biden administration also claims in a separate challenge that the two borrowers lack standing. Alexander Taylor and Myra Brown sued the Biden administration because they were not eligible for full relief under the plan. Taylor claims he did not qualify for the total $20,000 in emergency aid as it applies to Pell Grant recipients, and Brown has taken out commercially owned loans that do not qualify for any relief.

The borrowers, backed by a conservative group, argue that Biden’s plan violates the Administrative Procedures Notice and Comment Act, a federal statute that requires agencies to justify rulemaking to the public and gives them an opportunity to comment.

“Their argument is simply that they want more relief than what they’re getting, but getting rid of the program doesn’t solve that problem,” said Genevieve Bonadies Torres of the Lawyers Committee for Civil Rights, which filed a court filing for support. Biden’s plan.

If the court ultimately decides that neither challenger has standing, the cases would effectively be dismissed, paving the way for Biden’s policy to be implemented, according to legal experts.

But the justices could instead base their discussion on Tuesday and the eventual rulings around Biden’s authority to enact broad debt relief.

“They’re in the Supreme Court. They’re going to do what they want,” Jonathan Glater, a professor at the University of California, Berkeley School of Law, who signed a lawsuit supporting debt relief.

Still, he added, with at least an hour set aside for oral arguments in each case, he expects time to be spent on both standing and substantive issues.

As for the constitutionality of Biden’s plan, lawyers on both sides say they feel confident their respective views will prevail at the Supreme Court.

“I think they want standing,” Mattox said. “I think there’s very little likelihood that the court will get to the merits and actually say, ‘This is within the agency’s power under the HEROES Act.'”

However, Torres, of the Lawyers’ Committee for Civil Rights, which supported Biden’s plan, said “the law and the facts are on the side of the debt relief plan, and there should be a favorable ruling for the Biden administration.”

Millions of borrowers have already applied for loan forgiveness, Biden announced in August, but lower courts have temporarily paused the plan from taking effect. The Supreme Court is expected to issue its decisions in June.

Read the original article about Business Insider

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