On June 30, 2023 the United States Supreme Court invalidated the Biden administration’s student debt relief plan.
The plan had been introduced on August 24, 2022.
The 6-3 ruling stated “ in one of two cases that the program was an unlawful exercise of presidential power because it had not been explicitly approved by Congress” according to an article by NBC News.
The Biden administration had argued that the plan “was lawful under a 2003 law called the Higher Education Relief Opportunities for Students Act, or HEROES Act” the NBC article noted.
The NBC article also noted that Chief Justice John Roberts argued that the language used in the 2003 law was not specific enough, having stated that the precedent the court followed “requires that Congress speak clearly before a department secretary can unilaterally alter large sections of the American economy”.
An article from NPR also noted the ruling stated that the HEROES Act allowed for the Secretary of Education to “waive or modify” provisions that had previously existed, but did not allow “the Secretary to rewrite that statute to the extent of canceling $430 billion of student loan principal”.
The administration has since released a new fact sheet which discussed new actions taken to provide loan support and relief.
Borrowers who did not keep up with loan repayments following the restart will not be punished the updated fact sheet noted, it stated that “the Department is instituting a 12-month “on-ramp” to repayment, running from October 1, 2023 to September 30, 2024, so that financially vulnerable borrowers who miss monthly payments during this period are not considered delinquent, reported to credit bureaus, placed in default, or referred to debt collection agencies”.
The administration’s original fact sheet noted that the total cost of both public and private four-year universities has nearly tripled since 1980, after inflation was accounted for. Pell Grants covered one third of a college’s tuition, whereas they once covered nearly 80%.
Student loan debt has increased significantly, the original fact sheet noted that the “cumulative federal student loan debt—$1.6 trillion and rising for more than 45 million borrowers—is a significant burden on America’s middle class”.
Approximately one in five Americans hold student loans according to an article by the Washington Post. It also noted that “Student debt is most prevalent among Americans aged 25 to 34”.
The Biden administration is not the only one to come up with ways to alleviate student loan debt. A writer from the New York Times published an article originally titled “Six Ways You Can Still Cancel Your Federal Student Loan Debt” in which one of the options was simply death. An article from the Independent noted that the New York Times had revised the article “with the ‘death’ subhead being changed to ‘debt won’t carry on’”.
The article wrote that former Secretary of Labor, Robert Reich, had stated that “We’ve reached the point where The New York Times is suggesting death as a viable solution to crushing student debt,” in regards to the Supreme Court’s decision and the pre-revised article from the New York Times.
On June 30, 2023, Illinois Governor J.B. Pritzker sent out an E-News Release Statement, which stated that “40% of Americans with student loans do not have a college diploma. These are hard-working families just trying to get by, who hoped to further their education and instead found themselves often saddled with insurmountable debt”.
Pritzker also noted that Illinois has “increased student assistance by 75% in just the last four years, making it possible for more people to afford college, including allowing people to attend community college free”.
As of April 26, 2023, Illinois was the fourth most expensive state to go to college in according to education data.org.