US Supreme Court conservatives question Biden student debt relief

WASHINGTON - Conservative US Supreme Court justices on Tuesday signalled scepticism over the legality of

President Joe Biden’s plan to cancel US$430 billion (S$480 billion) in student debt

for about 40 million borrowers, with the fate of his policy that fulfilled a campaign promise hanging in the balance.

The nine justices heard arguments in appeals by Biden’s administration of two lower court rulings blocking the policy that he unveiled last August in legal challenges by six conservative-leaning states and two individual student loan borrowers opposed to the plan’s eligibility requirements.

Under the plan, the US government would forgive up to US$10,000 in federal student debt for Americans making under US$125,000 who took out loans to pay for college and other post-secondary education and US$20,000 for recipients of Pell grants awarded to students from lower-income families.

US Solicitor-General Elizabeth Prelogar, arguing on behalf of Biden’s administration, faced sceptical questions from conservative justices including John Roberts, Samuel Alito, Clarence Thomas and Brett Kavanaugh about the legal underpinning of the policy and its fairness.

Justice Roberts, the chief justice, questioned whether the scale of the relief could be considered a mere modification of an existing student loan programme, as allowed under the law the administration cited as authorising it.

“We’re talking about half a trillion dollars and 43 million Americans. How does that fit under the normal understanding of ‘modify’?“ Justice Roberts asked.

The policy, intended to ease the financial burden on debt-saddled borrowers, faced scrutiny by the court under the so-called major questions doctrine. Its 6-3 conservative majority has employed this muscular judicial approach to invalidate major Biden policies deemed lacking clear congressional authorisation.

Liberal Justice Sonia Sotomayor also noted the high-dollar amount at issue.

“How do you deal with that?“ Justice Sotomayor asked Ms Prelogar. “That seems to favour the argument that this is a major question.”

Questioned by Justice Alito about whether a member of Congress would consider this policy a major question, Ms Prelogar said, “Of course, we acknowledge that this is an economically significant action. But I think that can’t possibly be the sole measure for triggering application of the major questions doctrine.”

Ms Prelogar said that “national policies these days frequently do involve more substantial costs or trigger political controversy.” Ms Prelogar added that Mr Biden’s plan “is not an assertion of regulatory authority at all. This is the administration of a benefits programme.”

A 2003 federal law called the Higher Education Relief Opportunities for Students Act, or Heroes Act, authorises the US education secretary to “waive or modify” student financial assistance during war or national emergencies.”

Many borrowers experienced financial strain during the Covid-19 pandemic, a declared public health emergency. Beginning in 2020, the administrations of president Donald Trump, a Republican, and Mr Biden, a Democrat, paused federal student loan payments and halted interest from accruing, relying upon the Heroes Act.

The programme fulfilled Mr Biden’s 2020 campaign promise to cancel a portion of US$1.6 trillion in federal student loan debt.

Republicans called it an overreach of his authority.

The states that challenged it were Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina. The individual borrowers were Myra Brown and Alexander Taylor.

‘Massive new programme’

Justice Roberts told Ms Prelogar the case reminded him of Mr Trump’s effort - blocked by the Supreme Court - to end a programme that protects from deportation hundreds of thousands of immigrants, often called “Dreamers,” who entered the United States illegally as children.

“This is a case that presents extraordinarily serious, important issues about the role of Congress and about the role that we should exercise in scrutinising that - significant enough that the major questions doctrine ought to be considered implicated?“ Justice Roberts asked.

Justice Kavanaugh said Congress, in the Heroes Act, did not specifically authorise loan cancellation or forgiveness and that Mr Biden’s administration pursued a “massive new programme.”

“That seems problematic,” Justice Kavanaugh said.

Hundreds of demonstrators including borrowers rallied in favour of Mr Biden’s relief plan outside the court. Mr Biden wrote on Twitter, “The relief is critical to over 40 million Americans as they recover from the economic crisis caused by the pandemic. We’re confident it’s legal.”

Some Republicans have attacked Mr Biden’s plan as unfair because it benefits certain Americans - colleged-educated borrowers - and not other people.

Justice Roberts presented Ms Prelogar with a hypothetical scenario involving one person who took out a loan to pay for college and another who borrowed to start a lawn care company.

“We know statistically that the person with the college degree is going to do significantly financially better over the course of life than the person without. And then along comes the government and tells that person, ‘You don’t have to pay your loan,’“ Justice Roberts said. “Nobody’s telling the person who was trying to set up the lawn service business that he doesn’t have to pay his loan.”

Ms Prelogar responded to such “fairness” concerns raised by conservative justices by saying that “you can make that critique of every prior” government relief to various Americans under the Heroes Act.

The liberal justices raised doubts that the state challengers had the proper legal standing to bring their lawsuit based on the claim that Mr Biden’s plan would harm Missouri-based student loan servicer known as the Higher Education Loan Authority of the State of Missouri (MOHELA). They noted MOHELA did not itself bring the lawsuit.

The court’s rulings on the matter are due by the end of June. REUTERS