The Legal Dilemma on Student Debt Relief

Inside Higher Ed

Meghan Brink

September 6, 2022

Conservative groups and Republican state attorneys general are exploring legal options that could throw a wrench in President Biden’s plan to cancel a third of the $1.7 trillion in federal student loan debt. They say the plan is an illegal use of executive authority, but proving that in court could be tricky, as groups scramble to search for a plaintiff with the legal standing to sue.

Biden announced Aug. 24 that he would cancel up to $10,000 in student debt for borrowers making under $125,000 a year, with up to $20,000 in relief for Pell Grant recipients. The announcement has come as a relief to many individuals who have been burdened by outstanding debt. However, others, especially those who have paid off their debt or did not go to college, view it as a handout at the expense of taxpayers.

Various lawmakers, including some Democrats, have said that Congress holds the authority to cancel student loan debt, as opposed to the president. Even House Speaker Nancy Pelosi said last year that “the president can only postpone, delay but not forgive student loans. It would take an act of Congress, not an executive order, to cancel student loan debt.” However, Pelosi has since changed her view, stating in August, “Now, clearly, it seems he has the authority to do this.”

Multiple Republican state attorneys general are exploring legal options as well. The Washington Post reported on Thursday that Republican attorneys general from Arizona, Missouri and Texas met privately to discuss legal strategies.

Other conservative groups, such as the conservative think tanks the Heritage Foundation and the Job Creators Network, a group run by Republican donor Bernie Marcus, are exploring legal options as well. Marcus said on Fox News recently that his group is “in the middle of lining up our plaintiffs.”

A successful legal challenge could upend Biden’s plan, which is expected to give both the president and the Democratic Party a boost heading into the midterm elections. Despite speculation, no official plans to file a lawsuit have been announced.

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