President Biden said on June 30 that he would try again after losing a Supreme Court case over a plan to cancel $400 billion in student loan debt.
So what exactly is he proposing to do?
and fact sheet In announcing this second attempt, the White House wrote that it would seek to exercise the powers it believed the Department of Education had under the law. Higher Education Act 1965. In the Supreme Court case, the Biden administration sought to assert power under another law, the HEROES Act.
The process is expected to take at least several months, and it’s unclear how many people will be eligible for the relief measures the administration will ultimately offer.
The factsheet didn’t give details, but the government said: Press conferencerepeatedly referring to the “power of compromise and reconciliation” that the Education Act allows.
For further explanation, I turned to Luke HerrinAssistant Professor of Law, University of Alabama, Former Legal Director creditors, a membership organization and advocacy group that works to write off student loan debt. He is also the author of “”.Student Loan Jubilee Law and Political Economy,” a paper published in the Buffalo Law Review in 2020.
My interview with Professor Heline has been edited and condensed for clarity.
What’s the story behind student loan law that got you interested?
I decided to go to law school as part of the long aftermath of the financial crisis. I was becoming more and more politicized and tired of the political system. So I thought it would be helpful to go to law school to understand how the system works.
Through my work with Debt Collective, I learned about settlement and settlement authority. Another lawyer with more experience than me told me that. Why wasn’t this used more extensively?
So what is the relevant legal authority for this word and its derivation?
The Higher Education Act is the primary law governing federal student loans, providing authority to authorize the Department of Education to issue student loans and make income-based repayments, exemptions from civil service loans, and more.
There is a special provision that gives the Secretary of Education the power to act as program director and settle loans at its discretion. It allows the Secretary to “enforce, pay, compromise, waive, or discharge” a debt.
What does “compromise” mean? In legal terms, it means making a deal. Even more clearly, to “give up and release” means “I have no more obligations to this.” That’s what the authorities say.
And what was Congress’ intention with this statement?
As far as I know, there was no detailed conversation here. But what they meant was that if you set up an institution to manage debt, people might be resisting paying, and if all sorts of problems converge, a wise manager would As such, I think that the institution should be given the following: some flexibility.
This notion that government agencies can’t really make big moves unless Congress specifically grants permission is a “serious question” if I’ve ever seen one, and this is the Supreme Court’s It is related to the doctrine put down by the majority of The judges are now citing enthusiastically. This is a big question, right?
I don’t know if I can say otherwise. Clearly, the court will carefully consider the scope of any powers involved, especially powers that have never been used in this way before.
So how can the administration keep the problem under wraps?Thinking of narrowing down the target to a specific borrower with default settingsWhere is it time-consuming and expensive to collect?
I think we all agree that the Higher Education Act gives the Commissioner the power to compromise when filing a lawsuit against an already defaulted borrower. And I think most people would agree that you want to cut losses in anticipation of collection actions against borrowers.
So while we may have our own questions about the current scope of the Department of Education’s mandate, we will probably focus our cancellation efforts on borrowers we believe will be harder to collect. Perhaps they have been paying him for 25 years or his 30 years or are over a certain age. You can imagine several of these categories.
Has the White House asked you for advice?
If so, would you tell people in the room that “I said so” to that fact? they should have tried Is this tactic of compromise and reconciliation the first?
I think it would have been wiser to start writing off the debt without requiring an application from the debtor and then petition the court to recharge the balance.
I think we all agree that courts are skeptical of any claim of executive authority, so we need to take that into consideration, not just think about how to persuade them.
Years ago you wrote at the Roosevelt Institute: report: “The lack of a clear answer in current law should be seen as an opportunity, not an obstacle.”
However, as of the recent debt cancellation ruling, it is virtually definitive as to how the Supreme Court will rule in what is probably inevitable litigation over the interpretation of the higher education law you just described. We have the answer, don’t we? explained? I mean, why bother trying?
My sense is that Biden wants to run for re-election at least partially in this matter, and a little bit in opposition to the courts, what Biden did was illegal, so we’re going to try to do the same thing again. claims to be. Political pressure during the election period and ongoing investigations into the Supreme Court may further deter courts.
But even if he loses again, there is precedent. Many MPs are campaigning on the wisdom of canceling student loans. The more these things become part of the Democratic Party, the more likely they are to get better legislation.