Last week, the Washington Post reported that the White House was moving towards a long-awaited decision on the issue of student debt. Under the reported plan, the federal government would issue $10,000 in student debt relief per borrower. The plan would also impose caps on eligibility for individuals making over $150,000 a year and married couples making over $300,000. 

Following the report, several prominent progressive groups criticized the administration for not going far enough. Derrick Johnson, the president of the NAACP, said $10,000 “won’t do anything” for the Black community. “The average Black borrower has $53,000 in student loan debt four years after graduation, nearly twice the amount as their white counterparts,” Johnson said in a statement. “Ten thousand dollars in cancellation would be a slap in the face. President Biden, it’s not about whether you can do it; it’s about whether or not you have the will to do it.”

The White House denied that it had settled on a policy. “No decisions have been made yet. But as a reminder, no one has been required to pay a single dime of student loans since the president took office,” administration spokesperson Vedant Patel told Reuters.

Debt relief has long been a political and legal quandary for the Biden administration. On the campaign trail, Biden promised immediate debt cancellation of $10,000 per borrower, regardless of income. Even then, he seemed to have reservations about going higher. “I’m prepared to write off the 10 thousand dollars’ debt, but not 50,” Biden said, “[B]ecause I don’t think I have the authority to do it by a sign of the pen.” Biden seemed to be advancing an argument that some legal scholars found dubious: the president has the power to unilaterally cancel some amount of debt, but not too much. 

Last April, Biden tested that theory, asking the Department of Education to prepare a memo examining his legal authority to cancel student debt up to $50,000 per person. That memo’s findings were never publicly released, but a Freedom of Information Act request by the Debt Collective — a union of debtors — proved the existence of the memo, which was nearly entirely redacted. The administration’s subsequent lack of action has debt relief advocates speculating that Biden was told he does have the legal authority, but has nevertheless remained skeptical about the politics of debt forgiveness. 

There is disagreement within the broader legal community over the president’s ability to cancel student debt without Congress’s approval. In 2020, Senators Elizabeth Warren (D-MA) and Chuck Schumer (D-NY) introduced a resolution calling on the next president to cancel up to $50,000 in student loan debt per borrower. As part of that effort, Sen. Warren commissioned an analysis from a trio of experts at Harvard Law School’s Legal Services Center, who concluded that the president had clear existing legal authority to cancel federal student debt. 

The group of lawyers, which included Toby Merrill, who now serves as Deputy General Counsel at the Department of Education, wrote that the president’s authority comes from the Higher Education Act (HEA) of 1965. The analysis focused on two powers granted to the Secretary of Education by the legislation — the ability to “consent to modification” of loans, and to, among other things, “compromise, waive, or release” debt. 

But other legal scholars believe that courts may not be friendly to that interpretation. In a memo that was leaked to the Wall Street Journal, Charlie Rose, who served as General Counsel at the Department of Education under President Obama, wrote, “If the issue is litigated, the more persuasive analyses tend to support the conclusion that the Executive Branch likely does not have the unilateral authority to engage in mass student debt cancellation.”  

“The Rose letter suggests that going through the regulatory processes would likely get greater deference from the courts,” Howell Jackson, a Harvard Law professor and expert on consumer protection, told the Journal. “There’s more insulation if there’s a regulatory process.”

Still, as the midterms approach, the Biden administration’s greatest constraint may not be legal but political. A group of Republican Senators led by Mitt Romney (R-UT) have introduced a bill that would explicitly prohibit the Biden administration from canceling student debt. In a statement, Romney argued that debt cancellation would be “unfair to those who already repaid their loans” and would be “wildly inflationary at a time of already historic inflation.” 

Rep. Mondaire Jones (D-NY), in today’s Stay Tuned bonus, said that Biden’s reported plan was a step in the right direction, even if it doesn’t go as far as he’d like. “I think it’s $10,000 more [in relief] than people had,” he told Preet. “Of course it’s a good thing. I don’t see how anyone can in good faith argue against that. However, I do believe he should go further than $10,000.” 

Canceling $10,000 in debt per borrower could cost roughly $230 billion, according to the Committee for a Responsible Federal Budget, a nonpartisan think tank. That’s a drop in the bucket compared to the estimated $1.7 trillion in total outstanding student debt. 

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