Two challenges to President Joe Biden’s student debt relief program were heard by the U.S. Supreme Court Tuesday, four months after a lower court halted it. The Biden plan cancels up to $10,000 in debt for all federal borrowers with an income of less than $125,000 per year and up to $20,000 for people who had Pell grants, all under the federal HEROES Act. That would wipe out an estimated $430 billion of federal student loan debt
The separate challenges to the legality of the program were brought by Republican states—Nebraska, Missouri, Arkansas, Iowa, Kansas, and South Carolina—and by the Job Creators Network Foundation, a conservative group, on behalf of student loan borrowers Alexander Taylor and Myra Brown. The states’ argument is that they would be deprived of revenue if students with commercial loans consolidated them under the Department of Education’s lending program, where a chunk of the debt could be forgiven. The two borrowers argued that it wasn’t fair that they were left out of the forgiveness program because it has arbitrary eligibility rules and was created without following normal regulatory procedures requiring periods of public comment.
The administration argues that the program is absolutely legal and used the appropriate vehicle—the HEROES Act of 2003, which gives the Education Department broad authority to modify or to waive student loan payments in a national emergency. In 2003, the national emergency was the Iraq war and the beneficiaries were the troops fighting in it. In 2020, obviously, the emergency was the COVID-19 pandemic. The Trump administration paused student loan repayments and suspended accrual of interest in March of that year using the HEROES Act. The Biden administration extended it and, in August of 2022, expanded it to include debt forgiveness.
The first hurdle both sets of plaintiffs face is standing—are they explicitly harmed by the policy enough to have the court intervene? For this Supreme Court, with its Trump-packed majority, that’s a low hurdle.
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U.S. Solicitor General Elizabeth B. Prelogar argued, along with the court’s liberal justices, that neither plaintiff could prove that. The states were arguing that the loan forgiveness program’s potentially harms one entity in Missouri, a student-loan servicing company called MOHELA that was created by the state. MOHELA declined to be a part of the states’ case, and Prelogar pointed out that MOHELA is independent of the state, chose not to sue, and how could Missouri—and then, by extension, all the other states—claim harm if MOHELA wasn’t.
“Usually, we don’t allow one person to step into another’s shoes and say, ‘I think that that person suffered harm,’ even if the harm is very great,” Justice Elena Kagan told the states’ lawyer. “So why isn’t MOHELA responsible for deciding whether to bring this suit?”
“MOHELA isn’t here,” said Justice Sonia Sotomayor. “We don’t allow someone else to step in on behalf of someone else” in a federal lawsuit.
Even conservative Justice Amy Coney Barrett had a problem with that. “Why didn’t the state make MOHELA come if MOHELA is an arm of the state?” she asked. Even should Barrett side with the liberals on this question, it’s unlikely they’d find a fifth vote to dismiss the states’ case on standing. As for the borrowers, the argument is tenuous—they were harmed by not being eligible for the forgiveness program, and might have benefited if the administration had chose a different route for the forgiveness program. Basically, they’re arguing if they can’t have loan forgiveness, no one else should either.
There was a lot of focus among the court’s conservatives on “fairness,” which really isn’t a legal argument at all and came across as just a bit silly. Chief Justice Roberts started that one off with a hypothetical situation: two high school graduates, one who chooses to go to college and takes out loans, and a second who decides to get a loan to start a lawn care business.
“Nobody is telling the person who was trying to set up the lawn service business that he doesn’t have to pay his loan,” Roberts said. Justice Samuel Alito piled on, asking, “Why is it fair? Why was it fair to the people who didn’t get arguably comparable relief?”
That brought a succinct explanation from a probably annoyed Justice Sonia Sotomayor, pointing out that they are in apples-and-oranges territory: “Different people got different benefits under different programs.” Justice Ketanji Brown Jackson also chimed in on the absurdity of this argument, asking Prelogar if that would open up essentially all government programs to a question of fairness.
Sotomayor was there to remind all the participants of the stakes. “There’s 50 million students who are—who will benefit from this. Who today will struggle. Many of them don’t have assets sufficient to bail them out after the pandemic. They don’t have friends or families or others who can help them make these payments,” she said.
“And what you’re saying is now we’re going to give judges the right to decide how much aid to give them instead of the person with the expertise and the experience, the secretary of education who’s been dealing with educational issues and the problems surrounding student loans,” she continued.
Those are not the people the majority of the Supreme Court cares about. The majority, possibly without Barrett this time, proved hostile to the administration. Because they expedited hearing the case, they might issue a decision on an expedited basis, before the usual May-June period for decisions from the spring session.
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