President Biden recently announced his plan to cancel student debt. While popular with some, the Biden plan does nothing to change the upward trajectory of higher education costs. Indeed, easy availability of loans since 2010 has made it much easier for colleges and universities to increase tuition and fees.
Much of the blame for the current student loan mess can be traced to decisions made in 2010 by the Obama/Biden Administration. The Biden plan simply doubles down on that failure.
Much of the media have experienced a collective amnesia regarding the student loan mess. President Obama promoted the enactment of a federal takeover of student lending as part of the legislation which created the Affordable Care Act in 2010. At that time, Obama proclaimed that by cutting out the “middleman”, taxpayers would save $68 billion. Banks would no longer underwrite student loans and the federal government would directly lend to students.
Every one of Obama’s promises turned out to be untrue. The program didn’t save any money. Loan defaults increased. Colleges accelerated increases in tuitions and fees and student debt skyrocketed. Today’s student loan mess was caused largely by Obama’s failed program.
Biden’s plan is unwise for many reasons. First, it lets colleges and universities off the hook for students who never graduate or who graduate with degrees which don’t lead to a job. Second, it tells those who’ve repaid loans that they were suckers to do so. Third, the plan will create millions of new borrowers who in coming years will naturally expect their loans to be forgiven.
However, there is a more fundamental reason why Biden’s action is misguided: a president does not have the authority to waive debts owed to the federal government absent an express authorization from Congress.Despite his recent rhetoric about “defending democracy”, Biden ignores the question of his authority to unilaterally cancel student debt.
The White House knows full well that their policy is skating on thin legal ice. Over the past two years, Biden himself cast doubt on his ability to unilaterally forgive debt. Even Speaker Nancy Pelosi emphatically stated last year that the president has no authority to forgive student debt absent legal authority from congress.
So, what has changed? Apparently, the impending mid-term congressional elections have caused Biden and Democrats to change their tune. Fearful that young voters might sit out November’s elections, Democrats have decided that loan forgiveness might spur them to reward Biden’s party for their beneficence.
White House advisors contend that the president has this power under various provisions of the Higher Education Act. However, such discretionary authority only extends to the Department of Education’s ability to compromise loans which may be in default. Similarly, Biden relies on authority under the “Heroes Act of 2003”, a post-9/11 statute intended to assist those affected by the terrorist attacks. There too, such reliance is misplaced as cancellation of this small set of loans was expressly dependent upon congressional authorization.
The Biden plan would unilaterally forgive $500 billion in debt owed to the government and some reputable analysts say the cost is closer to $1 trillion. A president, regardless of whether named Biden or Trump or whether that person is a Democrat or Republican, cannot forgive debts owed to the government without authorization from congress.
Biden’s action is a violation of his constitutional oath to make sure the laws are “faithfully executed”. His actions are also not the first time he has willfully disobeyed the law. Last year, he illegally extended the federal eviction moratorium despite knowing it was likely to be overturned by the courts.
Biden’s debt forgiveness plan will also likely be struck down by the courts, but not until after the mid-term elections. The next time Mr. Biden proclaims his fealty to the rule of law and to the defense of democracy, we should remember his actions and not his words.
John J. Faso is a former Member of Congress and a former Minority Leader of the NYS Assembly
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