The Case for Upholding Biden’s Student Debt Relief Plan

While President Joe Biden's plan to forgive up to $20,000 in student debt for federal borrowers may be temporarily stalled in courts, advocates, legal experts, economists, and scholars are maintaining their pressure on the Supreme Court to allow the forgiveness to reach millions of Americans in 2023.

On February 28, the high court will hear oral arguments on the two lawsuits that are blocking Biden's plan.

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Meanwhile, more than a dozen groups have filed amicus-curiae briefs covering a variety of topics — from the plaintiffs' standing to sue to the student-loan company MOHELA's role in one of the cases — to the Supreme Court expressing support for Biden's plan.

Secretary of Education Miguel Cardona said the briefs demonstrated "the strength of our legal positions versus the fundamentally flawed lawsuits aimed at denying millions of working and middle-class borrowers debt relief."

"As these diverse groups made clear today, student loan borrowers from all walks of life suffered profound financial harms during the pandemic, and their continued recovery and successful repayment hinges on the Biden Administration's student debt relief plan," Cardona said. "We will continue to defend our legal authority to provide the debt relief working and middle-class families clearly need and deserve."

The administration has used the HEROES Act of 2003, which gives the Secretary of Education the ability to waive or modify student-loan balances in connection with a national emergency, as support for its right to implement its debt forgiveness plan — an argument which several of the briefs filed by legal scholars supported.

However, the lawsuits before the Supreme Court, and many conservative critics, have argued that the administration cannot continue relying on the pandemic to enact programs such as student debt relief, as the pandemic is widely viewed to have ended. But the briefs say the purpose of the administration’s plan is to help borrowers recover from the economic impacts of COVID-19, which can be long-lasting.

One of the lawsuits before the Supreme Court was filed by six Republican-led states. They allege that the debt relief would hurt tax revenues for their states, along with the revenues of MOHELA. However, that argument has been roundly criticized by advocates and experts, as MOHELA is its own entity and can sue and be sued on its own, and thus the states do not have standing to use MOHELA in their case.

The Supreme Court's decisions will also determine when student loan payments resume. When the lawsuits were filed, the Department of Education extended the student loan payment pause for 60 days after June 30, or whenever the lawsuits are resolved — whichever comes first. Advocates have stressed that until borrowers receive the relief they were promised, those payments should not resume at all.