Advocates Condemn Ruling as “Lawless and Shamefully Political,” Look to President to Deliver Debt Relief in Response to Decision and Call for Urgent Court Reform
June 30, 2023 | WASHINGTON, D.C. — The United States Supreme Court ruled 6-3 in favor of right-wing state officials in Biden v. Nebraska, formally blocking President Biden’s plan to use emergency powers to cancel up to $20,000 for student loan borrowers in the wake of the COVID-19 emergency.
With this decision, the Court not only rips away critical relief from 40 million borrowers and their families but also abandons legal precedent, putting all Americans at risk of losing other key rights. Today’s decision comes only 24 hours after the court issued a shattering ruling reversing decades of precedent on affirmative action, and is further evidence of the court’s self-inflicted legitimacy crisis and willingness to place special interests and politics ahead of the American people and the principle of equal justice under the law. Together, these decisions will exacerbate racial and economic inequities in this country and further demonstrate the urgent need for bold court reform.
At the same time, the Student Borrower Protection Center (SBPC) released a new memo making the political case for action in the face of this unjust ruling by the court. This memo highlights new polling conducted with Data for Progress (DfP), revealing, for the first time, broad support for action by the Administration to deliver debt relief using legal authority not connected to the pandemic and not affected by today’s ruling.
In response, SBPC Executive Director Mike Pierce issued the following statement:
“Today, a majority of this corrupt court brushed aside the rule of law to advance its ideological crusade against working people. The high court is asking people with student debt to pay the price for decades of government mismanagement and industry abuses across the student loan system—making it clear that, once again, the wealthy and powerful play by a different set of rules from the rest of us. Corruption is Chief Justice John Roberts’ legacy. This court will go down in history as one dedicated to expanding the rights of powerful special interests while stripping rights away from everyone else. The time for court reform is now. It now also falls to President Biden to stand with student loan borrowers and use the full might of the federal government to answer their demand for justice and relief in the face of this lawless and shamefully political ruling. Borrowers cannot afford to wait any longer.”
In response, SBPC Deputy Executive Director Persis Yu issued the following statement:
“Today’s decision is an absolute betrayal to 40 million student loan borrowers and their families counting on the court to uphold the law and move them closer to economic freedom. Caving to craven and naked political interests, this court relied on convoluted reasoning and distorted facts to allow these two politically contrived cases to deny desperately needed relief to tens of millions of low-income and working-class student loan borrowers. The government’s own data shows restarting repayment on September 1 without cancellation will result in millions of borrowers experiencing unprecedented levels of financial distress. President Biden must use all the tools at his disposal to protect borrowers and deliver on his promise to 40 million student loan borrowers.”
SBPC and DfP’s new poll found that 54 percent of voters support action to cancel student debt in the face of a loss at the Supreme Court, while 38 percent oppose. Among younger voters, such action wins majority support across party lines—70 percent of voters under 45 support action, including 84 percent of younger Democrats, 66 percent of younger independents, and 50 percent of younger Republicans.
The new SBPC polling memo is available here:
https://protectborrowers.org/POLLING-MEMO-06-2023-Student-Debt
From the memo:
“By agreeing to House Republicans’ demands to restart the student loan system, President Biden risks being the President who turned on a broken student loan system against the wishes of the American people and without providing the debt relief he promised. This new polling shows the political risks for the President in the weeks ahead but also provides a path forward to win the politics of student debt. It is clear that delivering on student debt relief– ensuring that borrowers promised relief actually see their loan balances decline—is good policy and necessary politics. Inaction is simply not an option.”
Background
Since President Biden first announced his intention to cancel up to $20,000 in student loan debt for the vast majority of borrowers, opponents of student debt relief have filed legal challenges seeking to halt this effort. In December, the U.S. Supreme Court agreed to hear two of these challenges—Biden v. Nebraska, brought by Republican officials in Nebraska, Missouri, Kansas, South Carolina, Arkansas, and Iowa, and Biden v. Brown, a challenge brought by student loan borrowers in Texas and funded by a right-wing dark-money group.
The states argue a debt relief plan would impact their ability to collect tax revenue from borrowers drowning in debt for decades and argue that student loan servicer MOHELA (not a party to the case) would be harmed economically. The second case, Biden v. Brown, was filed by two Texas borrowers who did not qualify for the full debt relief (not a Pell Grant recipient) or who were outright ineligible (privately held loans).
In January, an historic coalition of cities, states, experts, and advocates filed more than a dozen amicus curiae briefs with the U.S. Supreme Court in support of the Biden Administration’s student debt relief program. Leaders and public officials joined law scholars, economists, sociologists, higher education, and public policy experts from across the political and ideological spectrum in briefing the high court on the legal foundations of the President’s cancellation.
When Biden announced his intent to restart student loan payments after implementing broad debt relief, he explained that the Administration’s monumental debt relief plan was a necessary first step to protect borrowers and prevent disastrous loan defaults and other financial distress in light of the ongoing economic challenges facing our nation as a result of the COVID-19 pandemic.
Student loan borrowers with a federally held loan have not been required to make a loan payment since March 2020, when President Trump signed the CARES Act, pausing student loan payments and suspending interest charges for tens of millions of borrowers. This critical lifeline was extended eight times via executive actions taken by President Trump in August and December 2020, and by President Biden in January, August, and December 2021, and April, August, and November 2022.
In November 2022, a coalition of more than 220 organizations representing students, workers, and people of color called on President Biden to extend the pause on federal student loan payments until he kept his promise to cancel student debt, and utilize every legal authority available to enact that debt relief.
Further Reading
June 2022 letter from 550+ coalition urging President Biden to cancel student debt immediately: https://protectborrowers.org/550-organizations-tell-president-biden-to-cancel-student-debt-immediately/
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About Student Borrower Protection Center
The Student Borrower Protection Center (SBPC) is a nonprofit organization focused on alleviating the burden of student debt for millions of Americans. The SBPC engages in advocacy, policymaking, and litigation strategy to rein in industry abuses, protect borrowers’ rights, and advance economic opportunity for the next generation of students.
Learn more at protectborrowers.org or follow SBPC on Twitter @theSBPC.