News Release
July 3, 2023
ALF Student Debt Arguments
"Right On the Money"

Supreme Court Invalidates Biden Administration's
$430 Billion Mass Student Debt Cancellation
“People think that the President of the United States has the power for debt forgiveness. He does not. He can postpone. He can delay. But he does not have that power. That has to be an act of Congress.” 

Nancy Pelosi, then-Speaker of the House (Press Conference, July 28, 2021)
Last Friday, the Supreme Court held in Biden v. Nebraska that the Biden Administration had no authority, shortly before the 2022 mid-term election, to unilaterally cancel nearly a half-trillion dollars in student loan debt held by 43 million borrowers.

The Court's 6 to 3 majority opinion, authored by Chief Justice Roberts, emphasizes the Constitution's separation of powers between Congress and the Executive Branch. Quoting then-Speaker Nancy Pelosi (see above), the opinion explains that "[t]he question here is not whether something should be done; it is who has the authority to do it."

The Court held that the Biden Administration, through the Secretary of Education, cannot "rewrite" existing law "from the ground up" in order to "create[] a novel and fundamentally different"—a "radically new"—mass student loan forgiveness program. Only Congress can do that, and to date, has not done so.

ALF filed an amicus brief which, like the Court's opinion, focuses on the separation of powers, specifically in connection with expenditure of government money. Our brief pointed to the Constitution's Appropriations Clause, which provides that no money can be withdrawn (or expunged) from the U.S. Treasury without a specific congressional appropriation. The Biden Administration's now-invalidated plan literally would have withdrawn an estimated $430 billion in student loan debt assets held by the Treasury without any congressional appropriation. For this reason, ALF argued that the plan was unconstitutional.

ALF's amicus brief explains that the Framers added the Appropriations Clause to the Constitution as a vital check against unrestrained Presidential power. The Court's opinion agrees, citing the Appropriations Clause and observing that "[a]mong Congress's most important authorities is its control of the purse."

The dissenting opinion, written by Justice Kagan, asserts that student loans are in the Secretary of Education's "wheelhouse." To the contrary, Chief Justice Roberts' majority opinion states that "in light of the sweeping and unprecedented impact of the Secretary's loan forgiveness program, it would seem more accurate to describe the program as being in the 'wheelhouse' of the House and Senate Committees on Appropriations."

Because the separation of powers is so important to ALF's advocacy mission, we soon will be filing two additional amicus briefs in pending Supreme Court cases that implicate the Appropriations Clause. News releases about those filings will be issued in the coming days.

Media Contact: Larry Ebner | Tel: 202-349-1421
About the Atlantic Legal Foundation

For more than 45 years, the Atlantic Legal Foundation, a national, nonprofit, nonpartisan, public interest law firm, has advocated in the Supreme Court, federal courts of appeals, and state appellate courts for individual liberty, free enterprise, property rights, limited & responsible government, sound science in judicial & regulatory proceedings, and effective education, including parental rights and school choice.
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