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Supreme Court set to hear challenges to Biden's attempt to cancel student loan debt

MICHEL MARTIN, HOST:

This week, the U.S. Supreme Court will hear arguments in two cases that will affect the financial lives of millions of Americans. They are two separate challenges to President Biden's plan to cancel at least $10,000 in federal student loan debt for most borrowers. NPR's Cory Turner is here with us to tell us more. Cory, thanks so much for joining us.

CORY TURNER, BYLINE: You bet, Michel.

MARTIN: So what are we likely to hear this week?

TURNER: Well, let's start with the biggest question that's really at the heart of both of these cases, and that is, does the Biden administration have the legal power to erase student loan debts for tens of millions of Americans? Obviously, the Biden administration says yes, and their justification is a law known as the HEROES Act. So the HEROES Act was passed after the attacks of 9/11. And it specifically gives the education secretary the legal authority to basically waive or change the rules around the student loan program to help borrowers during a national emergency.

And the administration is arguing, look, COVID was a national emergency that devastated the finances of many student loan borrowers. And it says broad forgiveness is a justified response to that emergency. The Trump administration also used this same authority to justify beginning and then extending the pause on student loan payments early in the pandemic, although, obviously, there is a huge difference between pausing payments and outright erasing debts.

MARTIN: So tell us the other argument, the argument that the administration does not have the legal authority to do this.

TURNER: So the Congressional Budget Office estimates this plan would cost somewhere around $400 billion. And so plaintiffs will argue that the HEROES Act simply does not authorize that kind of enormous debt forgiveness. And in that way, the law is kind of like - you know that picture of the dress where some people see black and blue and some people see white and gold?

MARTIN: Yes, I remember that. Yeah.

TURNER: So this one sentence in this old HEROES Act law, it plays kind of like that dress. The plaintiffs' attorneys are going to tell the Supreme Court justices that a government agency should not be allowed to act on this kind of grand scale without very clear language in the law created by Congress. And they'll also likely point out Congress has specifically refused to pass legislation to erase student debt on this scale.

It's not enough for plaintiffs in either case to convince the court that the administration overreached here. They also have to convince the court that they have legal standing to bring a suit at all. That means they need to show that they would suffer some kind of concrete harm from Biden's debt relief plan. And it is worth noting, on that count, that one of these cases was actually thrown out by a lower court judge for this very reason until that decision was then reversed by an appeals court.

MARTIN: As you pointed out at the very beginning, you know, millions of people are waiting to figure out what's going to happen here. So when will - when might we know?

TURNER: Yeah. It has been tense for borrowers for many months, and it could well be several more. The court is expected to announce its decision by early this summer, and it's going to be a painful wait for a lot of people. You know, we know from the White House that roughly 16 million borrowers had already been fully approved for debt relief, and another 10 million were awaiting approval when the program was shut down by the courts. And, again, we're talking about folks who qualify for either this basic $10,000 in relief or $20,000 for lower income borrowers.

Student loan payments have been paused almost three years. And whatever comes out of this court decision, lots of folks are going to have to resume payments. Probably later this summer, the administration says payments will resume 60 days after either the debt relief program is allowed to proceed or the litigation is resolved.

MARTIN: That is NPR education correspondent Cory Turner. Cory, thank you so much.

TURNER: You're welcome, Michel. Transcript provided by NPR, Copyright NPR.

Cory Turner reports and edits for the NPR Ed team. He's helped lead several of the team's signature reporting projects, including "The Truth About America's Graduation Rate" (2015), the groundbreaking "School Money" series (2016), "Raising Kings: A Year Of Love And Struggle At Ron Brown College Prep" (2017), and the NPR Life Kit parenting podcast with Sesame Workshop (2019). His year-long investigation with NPR's Chris Arnold, "The Trouble With TEACH Grants" (2018), led the U.S. Department of Education to change the rules of a troubled federal grant program that had unfairly hurt thousands of teachers.