Wednesday, September 28, 2022

The Loan Arranger Faces The Posse

Of all of President Biden's accomplishments in the last 20 months, none infuriates conservatives more than his student loan forgiveness program, which has driven right-wing pundits into fits of rage usually reserved for Barack Obama breathing.

Back in August, Biden’s lawyers argued with half-straight faces that the 2003 HEROES Act — which, as Bloomberg Law has noted, was passed not as a generalized enabling act but “to help borrowers serving in the military in the wake of the Sept. 11 attacks” — could be twisted to apply to any national emergency, including pandemics such as Covid-19. This, of course, was nonsense. Among the specific problems with Biden’s argument was that the 2003 HEROES Act does not cover debt cancelation (i.e., transference to taxpayers); that its “direct economic hardship” language does not allow for mass relief; that the application of its “or national emergency” language clearly violates the major questions doctrine; and that the administration’s insistence that the act was designed to allow the executive branch “to act quickly should a situation arise that has not been considered” was flatly contradicted by the fact that the president waited until two-and-a-half years into the pandemic before acting, and then gave relief to the most privileged people in America. But, even if one were to ignore all that, one could still not get past the fact that the powers to which Biden laid claim can be applied only when there is an active emergency, and that the active emergency Biden is citing has now passed.

In May, the Biden administration (correctly) reported that it was obliged to end the use of Title 42 of the 1944 Public Health Services Act at the border because the Covid-19 emergency had passed. In a memo, the Department of Justice explained that, in 2020, “the Centers for Disease Control and Prevention (CDC) invoked its authority under Title 42 due to the unprecedented public-health dangers caused by the COVID-19 pandemic,” but that, two years later, “the CDC has now determined, in its expert opinion, that continued reliance on this authority is no longer warranted in light of the current public-health circumstances. That decision was a lawful exercise of CDC’s authority.”

Or, to put it more simply: Three months before Biden’s move on student loans, the CDC concluded that the pandemic was no longer enough of an emergency to justify extraordinary measures at the border.

That, a quarter of a year later, the same administration asked us all to believe that the same pandemic was bad enough to justify giving hundreds of billions of dollars to college students was always utterly preposterous. Tonight, on 60 Minutes, President Biden confirmed as much in public. The courts — and the voters — must take note.


No pandemic emergency, no need for student debt relief, so it's illegal, because everything Biden does by executive order is "illegal".  Only the thing is you can't just sue the country because you don't like the policies of the person in charge, you have to show standing, that is, the policy is directly hurting you.

So there's no surprise then that the right-wing noise machine has found a think tank lawyer who is ready to go to the mattresses on this as the victim of Biden's nefarious plot to save him tens of thousands in student loan debt, as Judd Legum examines.


One of the biggest challenges in filing a lawsuit to block Biden's debt relief program is fulfilling the technical legal requirement of standing. To file a civil suit in the United States, you can't just point out that someone is doing something that you think is wrong. You have to show that you are suffering immediate and concrete harm.

But who really suffers from student loan forgiveness?

According to the lawsuit, it's Garrison. The lawsuit says that Garrison "financed his college education using federal student loans" and was a Pell Grant recipient. Garrison says he is currently enrolled in another program called Public Service Loan Forgiveness (PSLF). Under that program, people working in a public interest capacity can have their loans forgiven after making 120 payments.

Garrison also says he lives in Indiana, which does not tax loans forgiven under the PSLF but does tax loans forgiven in other ways, including under Biden's new program. So Garrison says that the program will require him to pay "a state income tax liability of more than $1,000 for 2022" even though "a $20,000 reduction in his total indebtedness will not change either his monthly payment obligation or the total amount of the loans he must repay." This, the lawsuit states, gives Garrison standing.

There are a couple of issues, however, with Garrison's argument. First, the details of the program have yet to be established by the Biden administration. The administration could simply design the program so that anyone can opt-out. The White House indicated that would be the case in its response to the lawsuit. "The claim is baseless for a simple reason: No one will be forced to get debt relief. Anyone who does not want debt relief can choose to opt out," Abdullah Hassan, White House assistant press secretary, said in a statement.

The other issue involves Garrison's state of residence. According to the lawsuit, Garrison lives in Indiana. This is important because Indiana is one of the few states that would tax student loan forgiveness provided by Biden's program. But, until Tuesday morning, PLF's website said that Garrison was based in Washington, DC. Up until very recently, Garrison's LinkedIn page said the same thing.

This is significant because DC would not tax student loan forgiveness under Biden's program, and Garrison's case would be moot.

PLF's lawsuit is also fundamentally contradictory. The lawsuit argues that Garrison has standing because he would pay $1,000 more than he would otherwise. But the "solution" they offer to this problem is for millions of people to pay tens of thousands of dollars more.

It suggests that PLF may be more concerned about the economic and ideological interests of billionaires like Charles Koch than the large segment of the public saddled with student debt.
Gosh, you think?
And why are the Koch Bros against this?
Because the value of student loan debt increases as interest rates rise.  The whole point is to profit off this. Biden is challenging that entire paradigm, especially for Black and brown folks.

No wonder they want to sue the pants off of this program.

No comments:

Related Posts with Thumbnails