Joe Biden likely won’t cancel student loans and his comments today confirmed the same.

Here’s what you need to know.

Student loans

President-elect Joe Biden today confirmed what many already know:he probably has will not cancel student loans. It will not cancel $ 50,000 in student loans. It will not cancel $ 10,000 in student loans either.

It’s not that Biden doesn’t support student loan cancellation (he does). Despite calls from Congress and student loan advocates for Biden to write off student loan debt, Biden has not made a commitment to write off student loans through executive order.

Today, he has reinforced that commitment and has gone further. “Arguably the president may have the executive power to write off up to $ 50,000 in student debt,” Biden mentionned today. “Well, I think that’s pretty questionable. I’m not sure of it. I probably wouldn’t do that.

This is the first time Biden has publicly declared that he is unlikely to cancel student loans through an executive order. Previously, when asked the question, Biden said he wants Congress to legislate student loans. While Democrats in Congress have backed the cancellation of large-scale student loans, student loan relief was removed from the latest stimulus package and the cancellation of student loans was nowhere to be found.

Canceling student loans: the background

Where did the idea of ​​a president canceling student loans come from? Senator Elizabeth Warren (D-MA) and Senate Minority Leader Chuck Schumer (D-NY) introduced a congressional resolution asking the president to write off up to $ 50,000 in student loan debt for each borrower per through a decree. The resolution sparked a wave of enthusiasm among student loan borrowers and student loan advocates. Would Biden cancel all student loan debts? Would Biden write off all federal student loan debts? Speculation continued as Warren and Schumer continued to “pressure” Biden to end student loan debt with a stroke of a pencil. To this day, Biden has maintained the same position he has held since his presidential campaign: Congress is expected to cancel $ 10,000 in student loans for every borrower due to the Covid-19 pandemic.

Why Biden is unlikely to write off student loan debt with an executive order

The “why” behind Biden’s comments today is particularly important. Biden did not expand on his comments or explain the rationale for his position. However, reading between the lines, Biden’s comments imply that a president – at least President Biden – cannot or will not cancel student loans. Most legal scholars support Biden’s position – although it is now the subject of debate – that only Congress, and not the president acting unilaterally, has the power to write off student loan debt. Why? The Constitution of the United States provides for three distinct but equal branches of government. Congress is the branch of government responsible for the power of federal spending. Since student loan debt cancellation is indeed a form of federal spending, it falls in the way of Congress, not that of the President.

Warren and Schumer disagree. They argue that the Higher Education Act of 1965 gives the US Secretary of Education the legal authority to write off student loans, meaning the president could write off student loan debt without Congress now. Warren and Schumer point to Section 432 (a) of the Higher Education Act, which grants the United States Secretary of Education the power “to modify, compromise, waive or release any right, title, claim, lien or demand, regardless of acquisition, including any equity or right of redemption.

Does the higher education law really authorize the president to cancel student loans?

The US Secretary of Education can write off student loan debt under the Higher Education Act. Warren and Schumer are correct on this point. For example, the Secretary of Education may write off a federal student loan debt due to fraud, school closure, or total and permanent disability. However, this is not the same as forgetting about $ 1.5 trillion in federal student loan debt in one day. The power given to the Secretary of Education is procedural and limited to certain egregious situations in which borrowers have been deceived or harmed in some way. It’s different from giving the executive full authority to “spend” $ 1.5 trillion to cancel student loan debt (regardless of the nobility of the goal). As a former US senator, Biden knows this too. Biden knows the executive doesn’t have unlimited power. The separation of powers allows the legislature to “control” the executive branch, making it unlikely that a president can cancel all student loans at once. Ultimately, Biden might have the legal authority to do so, as he suggests. However, Biden does not appear willing – for pragmatic reasons – to be entangled in a possible constitutional question. It seems that the president-elect prefers to take the traditional route: to go through Congress, a route he knows all too well.

Pay off student loans

Biden’s comments are the most direct evidence that he probably won’t write off student loans through executive order. If there was a large-scale student loan forgiveness, it would come from Congress. However, there is no guarantee that Congress will cancel student loans – especially after student loan relief is removed from the stimulus bill – and if Republicans control the US Senate. If there is no student loan cancellation, make sure you have a student loan repayment plan. Here are 3 ways to pay off student loans, all at no cost:

Related reading

Are Student Loans Removed From The Stimulus Package?

No, Biden will not cancel $ 50,000 in student loans