WASHINGTON, DC – JUNE 29: U.S. President Joe Biden makes a statement about the Supreme Court n the … [+]
President Joe Biden spoke publicly on Friday following the Supreme Court’s ruling striking down his student loan forgiveness plan. That plan would have fulfilled one of his central campaign promises to cancel $10,000 or more in federal student loan debt. But the Court’s conservative majority ruled that the program was an improper overreach of executive authority.
Biden told reporters his administration is working on developing a new student loan forgiveness plan under a different legal authority.
Here’s the latest.
Supreme Court Strikes Down Biden’s Student Loan Forgiveness Plan
In a 6-3 ruling, the Supreme Court ruled in Biden v. Nebraska that President Biden did not have authority to enact such a massive student loan forgiveness plan. The administration had relied on the HEROES Act of 2003, a statute that provides broad authority to the Education Department to take action in response to a national emergency. But the Court interpreted the scope of the HEROES Act narrowly, and concluded that under the so-called Major Questions Doctrine, Congress must have explicitly authorized mass student debt relief for it to be permissible.
“The HEROES Act provides no authorization for the Secretary’s plan even when examined using the ordinary tools of statutory interpretation—let alone ‘clear congressional authorization’ for such a program,” wrote Chief Justice John Roberts on behalf of the Court’s conservative majority.
The Court’s three liberal justices, led by Justice Elena Kagan, wrote a spirited dissent. “In every respect, the Court today exceeds its proper, limited role in our Nation’s governance,” arguing that the majority used faulty logic to conclude that the state challengers had standing to sue, and then proceeded to misread the clear and unambiguous text of the HEROES Act.
Biden Details Backup Plan For Student Loan Forgiveness
In public remarks on Friday, President Biden defended his administration’s actions to provide debt relief to student borrowers, and promised that he would work around today’s Supreme Court ruling.
“I know there are million of Americans who feel disappointed, discouraged, and a little bit angry” over the Supreme Court’s decision, he said. “I do too… I believe the Supreme Court’s decision today was wrong.”
Biden touted the administration’s other student debt relief achievements, including increasing Pell Grants and reforming Public Service Loan Forgiveness, which provided student loan forgiveness to over 600,000 borrowers. Biden also referenced his proposed new income-driven repayment plan, which may reduce student loan payments by more than fifty percent for undergraduate borrowers as compared to current options. Further details on that plan are expected in the coming weeks.
But most notably, Biden indicated his administration will move forward on a so-called backup option for student loan forgiveness. Using a provision of the Higher Education Act that allows the Education Department to “compromise and settle” federal student loan debt, Biden said his administration will work on establishing a new student loan forgiveness path for borrowers.
“I’m announcing a new path to provide student debt relief to as many borrowers as possible, as quickly as possible, grounded in the Higher Education Act,” he said. “Just moments ago,” Education Secretary Miguel Cardona “took the first official step to initiate this new approach.” He did not provide details, but said he said the Education Department is taking the first steps to develop regulations for a new student debt relief program.
“The Court closed one path today,” Biden said, “But we’re working on another.” He said it will take time to establish the new program. The Education Department must first hold negotiated rulemaking sessions allowing for public comments and stakeholder input as officials consider what the new program will look like.
Biden also said he would create a temporary, 12-month “on-ramp” to repayment. Biden is prevented from extending the student loan pause again under a provision of the debt ceiling bill he signed earlier this month. And while his “on-ramp” initiative would not really be an extension of the student loan pause — monthly payments would be due, and interest will start accruing again after August — borrowers will not face any negative consequences for missing payments for the first year after repayment resumes.
Advocates Urge Biden To Not Give Up On Student Loan Forgiveness
Biden’s remarks echoed calls by advocacy groups and progressives in Congress to reject the Supreme Court’s reasoning and press on with student loan forgiveness initiatives, including using other legal tools to establish new relief, such as the compromise and settlement authority provided by the Higher Education Act.
“Today’s 6-3 Supreme Court decision is a devastating blow for tens of millions of low-income and working class Americans who were hoping for relief from the severe financial stress they face due to a mountain of student debt,” said Sen. Bernie Sanders (I-VT
“In the face of the Supreme Court’s unjust decision, the responsibility to fight for student debt relief falls squarely on the President’s shoulders. This is a moment that demands swift action,” said Natalia Abrams, President and Founder of the Student Debt Crisis Center in a statement on Friday. “The President possesses the power, and must summon the will, to secure the essential relief that families across the nation desperately need.”
“The same Supreme Court that overturned Roe now refuses to follow the plain language of the law on student loan cancellation,” said Sen. Elizabeth Warren (D-MA). “This fight is not over. The President has more tools to cancel student debt — and he must use them.”
Further Student Loan Forgiveness Reading
The Student Loan Pause Is Actually, Really Ending — 6 Key Dates And Details
6 Key Student Loan Forgiveness And Repayment Dates To Write Down Now
30 Million Borrowers May Face New Problems As Student Loan Pause Ends
4 Big Student Loan Updates When Payments Resume (And They Resume Soon)
