Joe Biden’s New Student Debt Relief Plan Might Actually Work This Time

First, the new plan is on sounder textual footing. Biden’s initial debt relief program relied on the Heroes Act, which gave the secretary power to “waive or modify” any legal provision that applies to student loan programs during a national emergency. The Supreme Court read the phrase “waive or modify” narrowly, holding that it does not encompass the power todebt. But the HEA’s language is more expansive, allowing the secretary to “compromise” and “release” debt.

Third, relief under the HEA may avoid the “major questions” trap that doomed the previous program. The Supreme Court said that Biden’s first stab at loan relief presented a “major question” of “economic and political significance” because it wiped out so much debt at once. The court held that the executive branch cannot enact such a “major” policy without explicit permission from Congress, which the Heroes Act lacked.

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