Legal Challenges Expected to Biden’s Student Loan Plan

Wall Street Journal: “Mr. Biden’s plan will test the legal limits of the federal government’s authority to cancel student debt. Its success could depend on how courts would interpret the education secretary’s powers under the 1965 Higher Education Act, which allows the secretary to ‘consent to modification’ of loans, and ‘compromise, waive, or release’ unspecified amounts of student debt.”

“Advocates for broad cancellation say the lack of explicit constraints in the law is deliberate, giving the executive branch flexibility with its ‘compromise authority’ to manage its relationship with borrowers. They note that presidents of both parties have used the law to forgive debt on a more-limited scale.”

New York Times: “Because Mr. Biden used executive action, rather than legislation, to forgive the loans, legal challenges are expected. It is unclear, however, who would have the standing to press their case in court. A recent Virginia Law Review article argued that the answer might be no one: States, for example, have little say in the operation of a federal loan system.”