Global Courant
The US Supreme Court.
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Judges consider whether president can forgive debts
At an estimated cost of approx $400 billion, Biden’s plan to cancel student debt is one of the costliest executive actions in history.
The judges are likely examining whether the president has the power to enact such sweeping policies.
The Biden administration insists it is acting within the law, pointing out that the Heroes Act of 2003 gives the US Secretary of Education the authority to make changes related to student loans during national emergencies. The country was active youunder a Covid-19 emergency declaration as the president rolled out his plan.
Opponents of the debt anniversary say the administration is misapplying the law adopted after the September 11 terrorist attacks.
“It is not a general get-out-of-debt provision that a government can invoke at will,” note the six Republican-led states in their lawsuit against the plan. “It is not a general get-out-of-debt provision that a government can invoke at will,” noted the six Republican-led states that filed one of the lawsuits against the plan.
Legal experts say the forgiveness plan faces major challenges
Gregory Caldeiraa political science professor at Ohio State University told CNBC before the pleas that he wouldn’t be surprised if the highest court rules against Biden.
“The court’s conservatives have been very aggressive in overturning the decisions of Congress and the president,” Caldeira said.
For a number of reasons, Dan Urmana law professor at Northeastern University, also predicts that student loan forgiveness will not survive the Supreme Court.
In an earlier interview, he said that the conservative judges believe that government agencies exercise too much authority and “violate the separation of powers”. In addition, he said, the concept of loan forgiveness seems to conflict with their views on individual responsibility.
The crushing of forgiveness will add to the growing skepticism that conservative judges vote for conservatives and liberal judges vote for liberals.
Dan Urman
professor of law at Northeastern University
However, such a politically motivated decision is likely to further damage public perception of the judiciary, Urman said.
“Abolishing forgiveness will add to the growing skepticism that conservative judges vote for conservatives and liberal judges vote for liberals,” Urman said.
Only 25% of Americans trust the Supreme Court, according to a Gallup poll found it last summer.
Still, the judges can make surprising decisions and lawyers said Attorney General Elizabeth Prelogarthe lawyer who pleaded on behalf of the Biden administration and its student loan forgiveness plan during pleas did an exceptionally good job.
Fordham Professor of Law Jed Schugermann had tweeted after the arguments in February that he was “struck by SG Elizabeth Prelogar’s brilliant performance”.
“She may have snatched victory from the jaws of defeat,” Shugerman wrote.
What’s at stake for borrowers
The outcome of the decision of the judges could have dire consequences for families, Thomas Gokey, co-founder of the Debt Collective, a national union of debtors, said in an earlier interview.
“For a lot of people, this is life and death,” Gokey said. “What’s at stake is being forced to choose between paying student loans or being able to buy groceries, pay rent and pay medical bills.”
If every eligible borrower applies for the waiver, Biden’s student loan forgiveness plan will wipe out an estimated $400 billion in federal student debt, according to to the Congressional Budget Office. That would reduce the country’s $1.7 trillion outstanding education debt balance to $1.3 trillion.
According to Kantrowitz’s estimate, the balances of about a third of those with federal student loans, or 14 million people, would be completely forgiven by the president’s program.
About 37 million people would be eligible for loan forgiveness, Kantrowitz estimates — up to $20,000 if they received a Pell Grant, a type of support for low-income families, in college, or even $10,000 if they didn’t. doing.
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