Breaking Down the Arguments as Supreme Court Hears Challenge to Student Loan Relief Plan Transcript

Welcome to the News Hour. The fate of some 40 million Americans promised student debt relief is now in the hands of the Supreme Court.

The justices heard arguments today in high stakes cases over the legality of President Biden’s student loan forgiveness plan. Students, teachers, and activists gathered outside the Court, highlighting their struggles and demanding debt relief.

In order to become the next generation of healthcare workers, the next generation of working in corporate America, basically being in your law enforcement, in order to do that, we must go to school. So how can we give back to our community if we don’t have the resources?

So I have upwards of $80,000 of student debt. Some of that is public. Some of that is private. And I think that student debt cancellation would be a benefit for many, many people, millions.

The issue has been embroiled in the Courts since the president announced his debt relief plan in August of last year.

John Yang has more on the day’s arguments.

The Court heard two challenges to the president’s plan, one from six Republican-led states and another from two student loan borrowers, one who doesn’t qualify for relief because her loans are held by a private lenders and one who doesn’t qualify for the program’s maximum benefit.

(01:17)
To discuss the arguments, NewsHour Supreme Court Analyst Marcia Coyle, and to talk about what’s at stake, Danielle Douglas-Gabriel, a Washington Post National Education Reporter. Marcia, there seemed to be a lot of skepticism today about this Biden plan.

Right, John. The skepticism seemed to be among primarily the Court’s conservative wing. And it’s always hard to predict, but my sense after the questioning was that there may be five conservative justices who, looking at the merits of the case, would not uphold the student loan forgiveness program.

(01:55)
But standing in their way of getting to the merits of that program is a big hurdle, and that’s called standing. Justice Barrett, along with the Court’s liberal wing, was very focused on standing, which we’ve talked about before. It’s the legal right to actually sue. And here, the challengers have to show that they have a specialized injury, a concrete injury that is traceable to the conduct of the education department policy here and that the Court can remedy it. It’s a huge hurdle.

(02:25)
And my sense after the arguments was also that the lawyers for the challengers were not making as strong an argument as the government made to oppose standing. If the Court doesn’t find standing, the case goes away and the program stands. But if they do, they can go on to the merits. And I also know that if you have five justices who really want to get to the merits, they may very likely find standing some way.

One reason the conservative justices were so skeptical about the constitutionality of the Biden plan is that they say there is no specific legislation authorizing it. Here is Chief Justice John Roberts questioning the Biden Administration’s attorney.

The case reminds me of the one we had a few years ago under a different administration, where the administration tried acting on its own to cancel the Dreamers program. And we blocked that effort. And I just wondered, given the posture of the case and given our historic concern about separation of powers, you would recognize at least that this is a case that presents extraordinarily serious, important issues about the role of Congress and about the role that we should exercise in scrutinizing that.

Marcia, this idea that Congress should be the one to decide big issues, that’s a theme for this conservative majority, isn’t it?

It is, and a recent one. It has to do with something called the major questions doctrine. The Court said in June in a case involving the Clean Air Act and EPA that if an agency issues a policy that has serious, major political and economic consequences, then the expressed authorization of Congress is required.

(04:14)
And that’s the primary argument of the challengers in this case, that this is a major questions doctrine case and the Court should apply that to require Congress to expressly authorize what the Department of Education did here.

The liberal justices take a different view of this question-

Yes. Definitely.

… of who should decide. This is Justice Sonia Sotomayor questioning the Nebraska Solicitor General.

There’s 50 million students who will benefit from this, who today will struggle. Many of them don’t have assets sufficient to bail them out after the pandemic. And what you’re saying is now we’re going to give judges the right to decide how much aid to give them, instead of the person with the expertise and the experience, the Secretary of Education, who’s been dealing with educational issues and the problems surrounding student loans.

The three liberal Justices, Sotamayor, Kagan, and Jackson seemed very sympathetic to the Biden administration argument that this was authorized by Congress.

Absolutely. Justice Kagan said that the act that the department used to promulgate this program is very clear. In fact, she said it couldn’t be any clearer that Congress gave the secretary the authority to waive or modify student loan requirements. And she said that the Court often gets statutes that aren’t very clear. But this one, she said, Congress has made clear its intent here.

Well, there was a lot of discussion about those two words, waive and modify.

That’s right. That’s another issue in the case. Justice Thomas was saying, “Well, waive and modify, how does that amount to cancellation as can happen in some of the student loans that are being looked at here?”

(06:18)
And the government argues that it’s waive and modify the requirements around student loans. And the secretary did both here. And then once he waived and modified them, he imposed new ones, the ones that are being challenged today.

And the conservative justices also talked about fairness.

Yes. That was a very interesting exchange. Some of the justices, the Chief Justice, Justice Alito, Justice Kavanaugh, they spoke about how, “Well, you know…”

(06:50)
I think it was the Chief Justice gave the best hypothetical. He talked about two students who graduate from high school. One takes out a loan to go to college, another takes out a loan to create a lawn service. Why should the student who goes to college and will probably make more than the lawn service student in a lifetime, why should that student have a debt forgiven, but not the lawn service?

(07:11)
And the government said very clearly that this act involves student loans. It doesn’t involve other types of loans. And there are other types of aid available to the lawn service student who has that loan. So there is that concern, and they were asking whether they should factor into their analysis the idea of fairness here.

Danielle Douglas-Gabriel, if this program were to go away, what kind of student loan borrower would be most heavily affected?

Well, because student loan debt is disproportionately shouldered by Black borrowers and borrowers of color, they would be the ones who would most likely be impacted. I think it’s really telling that the administration chose to add essentially a Pell Grant bonus, allowing for borrowers who had federal Pell grants for low income students to receive an additional, $10,000. And many people would qualify for that because many of those who have gone to college in the last few decades have fewer resources than in generations passed.

Without this program, when will the crunch come for these borrowers?

Well, the Department of Education has said that payments will start to resume 60 days after a decision is made and is certainly no later than June of this year. Now, keep in mind that borrowers have not made payments. Most federal student loan borrowers have not made payments on their loans for nearly three years at this stage. And there is a lot of concern in part, and this is the reason why the administration says this policy is needed, that many of those borrowers will struggle to make payments on their loans. They will become delinquent or potentially default on their loans.

In January, the administration unveiled a new income-based student repayment plan. How does that work?

Well, this plan pretty much updates an existing student loan repayment plan by assuring that borrowers pay less of their discretionary income for a shorter amount of time before getting their student loans forgiven. So for example, a undergraduate borrower who has taken out $12,000 or less in undergraduate debt could pay 5% of their discretionary income for 10 years before the balance of their loans are forgiven.

What are the options for the administration if this plan gets struck down?

So the administration could try to make this happen through an authority of under the Higher Education Act. Now, that would require a negotiated rule making, which is a pretty lengthy process. And I think that came up today during the arguments.

(09:52)
And one of the reasons why it really wasn’t the most salient route for the administration is because it really undermines the idea that this is for an emergency, for a national emergency, and this is to prevent any kind of fallout from that national emergency. The HEA doesn’t exactly lend itself to that argument, whereas at least in the administration’s views, the Heroes Act does.

Is the education department or is the administration already thinking about these things?

Well, they are not telling me. I’ve been asking a whole lot the last few days. And they keep saying that they’re very confident that the Heroes Act gives them the authority that is needed to make sure that this program will go forward. And they are confident that the Supreme Court will agree.

(10:39)
Certainly after today’s arguments, lots of folks who are watching this don’t necessarily take that optimistic of view. But at this moment, there isn’t a concrete plan that’s being publicly discussed about what will happen next if the plan is struck down by the Court.

Danielle Douglas-Gabriel of the Washington Post. Marcia Coyle, NewsHour Supreme Court Analyst, thank you both very much.

Pleasure, John.

Thank you.