Reviews | Biden shouldn’t have the legal power to forgive student loans

This potential executive overreach is even more troubling than the actual impact of a policy that, on average, would favor the wealthiest Americans at the expense of everyone else, overstimulate an already inflationary economy, and do nothing to improve the future affordability of universities.

“No money shall be taken from the Treasury, but accordingly from the appropriations created by law”, says the Constitution. If this provision were designed to prevent anything, it would be a taxpayer-funded write-off of $321 billion in government obligations, based on little more than presidential statements. (That’s roughly the cost of a $10,000 rebate plan per debtor similar to what Biden would have considered, according to the Federal Reserve Bank of New York.)

This Constitutional 180, if it happened, would take place not after 49 years but just 441 days since February 16, 2021, when Biden said, “I don’t think I have the authority to do it by signing with a pen, and 279 days since the July 28 press conference in which House Speaker Nancy Pelosi (D-California) said, “People think the President of the United States has the power to cancel the debt – he doesn’t. He can postpone. He can delay. But he doesn’t have that power – it has to be an act of Congress.

(Pelosi spokeswoman Joy Lee acknowledged the White House is reviewing its policy and told me the speaker is “generally supportive of the administration’s efforts.”)

The current, often extended pause in loan repayments was authorized in two pandemic-fighting laws – the Cares Act of March 2020 and the Heroes Act of December 2020. It expires on August 31. There has been no new legislation and the midterm elections are fast approaching. Therefore, Biden is under pressure to act unilaterally.

Proponents of forgiveness of executive loans deny that it would be a usurpation. They argue that Congress possesses delegated the necessary powers. A federal law – the Higher Education Act of 1965 – empowers the Secretary of Education to “compromise” or make “modifications” to federal government debts – words, they argue, that include the power to eliminate debt.

Who knew? Certainly not Pelosi, since last July. As Harvard Law School’s Howell Jackson explained in a recent law journal article, “proponents … must defend the proposition that Congress in 1965 actually authorized the spending of what could exceed $1 trillion dollars of public resources. … To say the least, this assignment of authority was not explicit and is far from clear. The “traditional view,” Jackson wrote, is that the law authorizes selective lending adjustments to borrowers based on “some sort of individualized determination”.

If all of this sounds familiar, it may be because so many recent presidents have embarked on a similar status stretch. In November 2014, President Barack Obama announced that he would interpret existing law to grant deportation assistance and work permits to hundreds of thousands of undocumented immigrants – after repeatedly waiving his power to do such a thing. “I’m not an emperor,” he said at one point.

President Donald Trump circumvented immigration law to ban immigrants primarily from several Muslim-majority countries in early 2017. Biden’s proposed mandate for the workplace vaccine was based on a questionable immigration law endorsement. safety and health at work.

All of the above has culminated in litigation — with varying results, including the recent defeat of Biden’s vaccine mandate in the Supreme Court. What’s different — and, for Biden, potentially attractive — about executive-ordered mass loan relief is that opponents might not even enter court. As Jack V. Hoover argues in the Virginia Law Review, mass debt cancellation does not harm the excluded except in the diffuse sense of having to pay taxes; no plaintiff would have the concrete “precise harm” required to sue.

“The main takeaway from the last 250 years of recorded American history is that presidents are not kings,” Supreme Court Justice Designate Ketanji Brown Jackson wrote in a 2019 opinion. The context was selfish resistance of Trump at the request of Congress for the potentially damaging testimony of his White House attorney, Donald McGahn.

Strictly speaking, however, Jackson’s words would apply equally to an attempt to grant executive beneficence – such as loan forgiveness.

Pelosi herself is aware of the potential downside: “Let’s say…your child at this point decides he doesn’t want to go to college but you’re paying taxes to forgive someone’s obligations. ‘other,” she said at that July 2021 press conference. “You might not be happy about that.”

Excluded from the courts, their representatives in Congress having been dismissed, the discontented would have only one outlet: the ballot box.