The Joe Biden administration appears to be moving swiftly to craft an alternative student debt relief plan in the wake of the Supreme Court’s decision to shoot down Biden’s initial plan – which makes sense given how predictable the decision was.
Exactly what Biden has in mind is not yet clear, but the administration seems to be mobilizing to forgive student debt under the Higher Education Act.
“The ink had hardly begun to dry on the Supreme Court’s decision when Secretary of Education Miguel Cardona declared that he had a new plan to fight for student borrowers,” Slate reported.
Part of the new plan, mercifully, was designed to transition borrowers (who have had repayments suspended for over three years) back into repayment mode when the repayments resume in October.
The new plan will “lower monthly payments for lower-income borrowers, suspend penalties for missed payments, and put community college graduates on a path to full relief within 10 years.”
These new facets will help thousands of borrowers, and should be commended – but it’s not the outright cancellation borrowers had been promised. Although, Cardona hinted at a new pathway to achieving student loan cancellation through a “rulemaking process” that could open “an alternative path to debt relief” using the Higher Education Act of 1965 (aka the HEA).
“In truth, the HEA has always been the best fit for Biden’s plan under current law. The statute gives the secretary of education power to “compromise, waive, or release” any “claim” against student borrowers. His exercise of this power “shall be final and conclusive upon all accounting and other officers of the government,” Slate reported. However, the HEA stipulates that the secretary of education “may not enter into any settlement of any claim” in excess of $1 million without review from the attorney general.
Well, the HEA’s language is certainly clear in granting the secretary of education to compromise, waive, or release any claim against a student borrower. You’d think that the plain language of the Act would satisfy the textualist conservatives on the Supreme Court – but I’ve got a feeling their textual interpretations are dependent upon the ends of their textual interpretations. But would student debt cancellation under the HEA be subject to judicial review? Perhaps not.
“One enticing aspect of [the HEA] is the possibility that it insulates debt relief from judicial review.” As one scholar explained, the Act’s ““settlement and compromise” power embodies the executive branch’s broad “prosecutorial discretion” to enforce the laws that Congress enacts,” Slate reported. And conveniently, the Supreme Court upheld the “basic principle” of settlement and compromise last month, “reiterating the chief executive’s constitutional authority to “decide how to prioritize and how aggressively to pursue legal actions” against those in breach of law.” And of course, the Supreme Court has long upheld the principle that the judiciary may not review decisions that are “committed to agency discretion.” Separation of powers, folks.
Multiple scholars, who have studied the implications of the HEA, believe that “under the HEA, the secretary of education can relinquish all claims against the vast majority of student borrowers right now. The result would be mass cancellation of their debt,” Slate reported.
Indeed, the HEA was progressives preferred avenue for cancelling student debt in the first place, preferring the HEA over the executive order that Biden ultimately issued.
So, the good news is that Joe Biden appears to have a clear path toward cancelling student debt (all of it, should he choose). The question is whether Biden will have the guts to walk that path.
Harrison Kass is the Senior Editor and opinion writer at 19FortyFive. An attorney, pilot, guitarist, and minor pro hockey player, Harrison joined the US Air Force as a Pilot Trainee but was medically discharged. Harrison holds a BA from Lake Forest College, a JD from the University of Oregon, and an MA from New York University. Harrison listens to Dokken.