Rule of Law

Congress Just Upended the Legal Case Against Biden’s Student Debt Relief Plan

Later this month, the Supreme Court will issue its decision on whether the Biden administration’s student debt relief program can go forward. Those challenging the program have invoked an aggressive form of the “major questions doctrine,” a newly prominent (and judge-invented) rule that demands “clear congressional authorization” when agencies use ancillary statutory provisions to fundamentally transform their authority to great effect. Some on the court have claimed this doctrine ensures that lawmaking power “remains where Article I of the Constitution says it belongs—with the people’s elected representatives.”

If the lawmaking power is to remain with the “people’s elected representatives” instead of unelected judges, then the student loan payment provisions of the recent debt ceiling deal provide powerful support for the legality of the student debt relief plan. The deal shows that the elected branches of government remain able and willing to legislate on student debt, yet they have enacted no laws that suggest that the education secretary overreached on student debt relief. Indeed, members of Congress have proposed bills seeking to strip the education secretary of that authority, and none of those bills have become law. If Congress isn’t limiting the broad authority Congress has already given the education secretary, it’s certainly not the Supreme Court’s place to rewrite the law.

To start, some quick background on pandemic-era student loan policy. The HEROES Act gives the education secretary broad authority to “waive or modify any statutory or regulatory provision” related to student assistance as he “deems necessary in connection with a … national emergency.” Education secretaries during both the Trump and Biden administrations used this authority to pause student loan payments and interest. Last year, Secretary Miguel Cardona announced that the end of the pause would be paired with a targeted debt relief program.

As Justice Brett Kavanaugh acknowledged at oral argument, the word “waive” in the HEROES Act “is an extremely broad word,” suggesting wide latitude for the Department of Education. However, to opponents of the student debt relief plan, the breadth of the law’s plain text does not matter because Congress did not explicitly authorize this specific type of relief. According to them, this shows that Congress must not have meant for the education secretary to have authority to forgive debt using the HEROES Act. The debt ceiling deal signed into law this past weekend suggests just the opposite. It leaves the administration’s authority on student debt largely untouched, only codifying the end date for the payment pause—in line with the Biden administration’s previous announcements—and prohibiting further extensions. While the end of this pause is a blow to borrower advocates seeking flexibility, what’s significant for the Supreme Court case is that the deal leaves intact the education secretary’s ability to act on student debt during future emergencies.

As one conservative critic acknowledges, the deal’s recognition that the secretary can use his waiver and modification authority to extend the payment pause for another three months “seems to codify the legality of the pause.” This upends several of the challengers’ arguments regarding student debt forgiveness. It demonstrates there is nothing suspicious about the education secretary using the HEROES Act to grant large amounts of relief, as the pause is estimated to end up costing $195 billion. And it shows that the act’s provision clarifying that its authority does not need to be exercised “on a case-by-case basis” means what it says and allows broad-based relief. The pause applied broadly to all federal student debtors, unlike the debt forgiveness plan which is more carefully targeted based on income and Pell Grant status.

This enacted legislation stands in stark contrast to countless unsuccessful congressional attempts to overturn the debt relief plan and prevent future broad-based forgiveness programs. Significantly, the court has looked to unsuccessful legislative efforts before as part of its major questions analysis. During oral arguments in one of the student debt cases, Chief Justice John Roberts mused that if an issue “has the attention of Congress” but legislators fail to act, that suggests that the issue “should be one for Congress,” not the executive branch. It’s a surprising approach for a court dominated by textualists, a group that professes to care about the text of the laws Congress passed—not laws that didn’t pass or legislative materials that are not reflected in statutory text. And the court itself has repeatedly said that little should be read into legislative inaction because there are countless reasons why a bill may not end up becoming a law.

But to the extent this logic applies, these failed legislative efforts are surely significant. Consider House Republicans’ first proposal for raising the debt limit, the “Limit, Save, Grow Act,” which took aim at multiple Biden administration student loan policies. The bill would have nullified the payment pause, student debt relief plan, and recently-proposed income-based student loan repayment plans, as well as barred substantially similar actions “except as expressly authorized by an Act of Congress.” If enacted, the bill would have also prohibited the secretary of education from using regulations or executive actions that were “economically significant” and “would result in the increase in a subsidy cost resulting from a loan modification” to implement the student assistance title of the Higher Education Act. While that bill passed the House, its attempts to limit the preexisting authority of the secretary of education went no further.

The “Limit, Save, Grow Act” wasn’t the only effort this year to restrict existing executive authority to forgive student loans. Congress attempted to use the expedited procedure in the Congressional Review Act to strike down the debt relief plan, but President Biden is expected to veto the resolution. Rep. Bob Good introduced a bill to prohibit the use of HEROES Act waivers or modifications to pause payments and interest for more than 30 days or to discharge outstanding student debt. And Rep. Drew Ferguson introduced another bill which purported to prohibit executive officials from “cancel[ing] or forgiv[ing]” student loans outside of targeted forgiveness programs in the Higher Education Act. That bill also sought to impose a clear statement rule when executive officials address student debt repayment, forbidding regulations or actions “not expressly permitted within statute or regulation … except to the extent that such … reflects the clear and unequivocal intent of Congress in legislation.”

These bills show that Congress can place limits on the education secretary’s authority regarding student loans. But none of these efforts have made it through what the Supreme Court has described as the “‘finely wrought’ procedure that the Framers designed” for the enactment of legislation. This further demonstrates that debt relief opponents who have sought to make this change through lawsuits instead of the political process ask the Supreme Court “to alter, rather than to interpret,” the HEROES Act.

The text of the HEROES Act gives broad authority to the secretary to “waive or modify any statutory or regulatory provision” related to assistance programs to ensure that student debtors “are not placed in a worse position financially” due to national emergencies. Justices might have their own policy views on whether it’s “fair” to give relief to student borrowers and not to other borrowers—indeed, oral arguments showed several justices wrestling with the “fairness” of the program—but Congress made the decision to authorize debt relief for student borrowers. And the Supreme Court should leave those sorts of policy judgments to our elected policymakers.