“Good intentions,” said Sen. Daniel Webster (Whig-Mass.) in a March 1837 speech, “will always be pleaded for every assumption of authority. It is hardly too strong to say that the Constitution was made to guard the people against the dangers of good intentions.” The Constitution does this by limiting the powers of each branch of government to prevent too much power from ending up in too few hands.
Relieving some student loan debt, especially on the heels of a worldwide viral pandemic, may sound like a good intention, but President Joe Biden’s plan is bad policy, and the way he is trying to implement it is unconstitutional.
The Higher Education Act of 1965 authorizes direct student loans. The White House says that about 43 million borrowers will see at least $10,000 of their debt disappear, and almost two-thirds will benefit by twice that much.
First, the policy issues. Debt, of course, does not simply disappear. There is no such thing as debt “forgiveness” or “cancellation.” There’s only shifting the burden of paying that debt to someone else, someone who did nothing to incur that debt or contractually promise to pay it back. Nearly one-third of high school graduates, for example, don’t go to college. Millions of taxpayers who went to college paid back their loans. The Congressional Budget Office estimates that Biden’s plan will shift more than $400 billion to these and other Americans who never chose, or may have actively avoided, such an obligation.
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Lindsey Burke, director of The Heritage Foundation’s Center for Education Policy, writes that this bailout could benefit borrowers in households with income up to $250,000 while the national median family income is about $80,000. In fact, one analysis showed that nearly three-quarters of the “forgiveness” with go to the upper end of the household income distribution. Even Lawrence Summers, Treasury Secretary during the Clinton administration, says that it will put both broad and narrow pressures on inflation, which is already the highest in four decades.
Burke also notes that this debt-shifting scheme does nothing to encourage educational institutions to control costs, which have risen much faster than inflation. Instead, the prospect that borrowers will not bear the whole cost of their own decisions may well lead to poor academic choices and an even greater reliance on debt.
Then there are the constitutional concerns. This plan did not result from Congress amending the Higher Education Act, or the Department of Education following the necessary process for issuing new regulations. That would be the honest way to change education and economic policy. Under the Constitution, Congress needs a power actually listed in the Constitution, or one “necessary and proper” to carry them out, to pass legislation. And executive branch departments and agencies must implement Congress’s statutes; they do not have the power to, in effect, enact new ones.
The idea that the president could simply cancel student debt has always been controversial. Even House Speaker Nancy Pelosi said in July 2021 that “it would take an act of Congress, not an executive order, to cancel student loan debt.”
So how does Biden attempt to justify his debt-redistribution scheme? He says he gets authority from the HEROES Act, a statute enacted after the 9/11 terror attacks to give military servicemembers a temporary reprieve from their student loan obligations while deployed overseas. Biden says that the COVID pandemic counts as a comparable emergency and, in turn, justifies this massive debt-redistribution operation. One problem, however, is that Biden’s plan has only one eligibility criterion: income. Even though this is supposedly tied to the pandemic, no one needs to show that they suffered any financial harm as a result of the pandemic.
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Administrations of both parties have come and gone since Congress enacted the HERTOES Act, but none has ever suggested that this law allows anything like the authority to shift responsibility for student debt that Biden has unilaterally deployed. In fact, as my Heritage Foundation colleagues GianCarlo Canaparo and Jack Fitzhenry have explained, the White House announcement of this redistribution effort barely mentions the pandemic at all. This suggests that the HEROES Act is just a cover, and a thinly veiled cover at that, for a political gambit that really has no lawful authority.
In September, six states sued the Biden administration over this debt plan, and they are unlikely to be the only plaintiffs. In order for a court to have jurisdiction over a case, the plaintiff must have legal standing, that is, they must have suffered a concrete injury caused by the defendant that can be remedied by a court. If that hurdle is crossed, cases like this one give courts the chance to affirm the limits that the Constitution places on government.
Good intentions cannot distract us from making sure that government has lawful authority when it acts.
This piece originally appeared in Christian Renewal