A divided Supreme Court on Friday has struck down an expansive debt-relief program for student loans created during the Covid-19 pandemic.
In a 6-3 ruling in Biden v. Nebraska—with a majority opinion written by Chief Justice John G. Roberts—the Court concluded that an act of Congress that empowers the Secretary of Education to “waive or modify” financial assistance programs “does not allow the Secretary to rewrite that statute to the extent of canceling $430 billion of student loan principal.”
A second challenge to the program, Dept. of Education v. Brown, was dismissed by a unanimous Court as lacking standing.
In the first challenge, Nebraska and five other states filed a lawsuit to block the program from going into effect, citing an adverse negative impact on the states and the Biden administration’s lack of a clear grant of power under the Higher Education Relief Opportunities for Students (HEROES) Act of 2003.
The debt-relief program was intended to provide up to $20,000 in loan forgiveness for certain candidates, with at least 30 million people potentially eligible.
“The text of the HEROES Act does not authorize the Secretary’s loan forgiveness program. The Secretary’s power under the Act to ‘modify’ does not permit ‘basic and fundamental changes in the scheme’ designed by Congress,” Roberts concluded.
Justice Elena Kagan, joined by Justices Sonia Sotomayor and Ketanji Brown Jackson, argued that “in every respect, the Court today exceeds its proper, limited role in our Nation’s governance.” Kagan concluded that the Court’s majority “overrides the combined judgment of the Legislative and Executive Branches, with the consequence of eliminating loan forgiveness for 43 million Americans.”
The second challenge was from two borrowers who questioned whether the program “was statutorily authorized and was adopted in a procedurally proper manner.”
In the unanimous opinion from Justice Samuel Alito, the Court concluded that the respondents failed “to establish that any injury they suffer from not having their loans forgiven is fairly traceable to the (debt-relief) plan.”
Scott Bomboy is the editor in chief of the National Constitution Center.
