CounterCurrent: Week of 7/10/23
Last week, I wrote to you about Students For Fair Admissions, Inc. v. President and Fellows of Harvard College, the Supreme Court decision that continues to be a contentious topic of conversation. This week, we have another landmark SCOTUS ruling to unpack: Biden, President of The United States, et al. v. Nebraska et al. There are a lot of rapid-fire policy and legislative decisions being handed down for higher education right now, so let’s take a moment to step back and reflect.
On June 30, the Supreme Court struck down in a 6-3 decision the Biden administration’s student loan forgiveness plan. This plan would have forgiven $10,000 of student loans for borrowers making less than $125,000 per year, and $20,000 for those who had received a Pell grant. The Biden administration claimed a 20-year-old law as the authority for its plan, a law that allows the Secretary of Education to “waive or modify” loan terms during a war or national emergency (i.e., the COVID-19 pandemic).
Andrew Gillen, in an article last week for Minding the Campus, summarized the ruling and analyzed what it means for higher ed (it’s worth a full read). From a policy standpoint, student loan forgiveness was always a bad idea. Gillen writes,
It used the real financial struggles of a small portion of borrowers as an excuse to shower almost all college graduates with an unearned windfall. It ignored income-driven repayment plans—which guarantee payments are always affordable—that already exist and that are used by a third of borrowers. It would have exacerbated the problem it was supposedly solving, as forgiveness would encourage students to borrow even more (anticipating future forgiveness) and colleges to raise prices, both of which would lead to even higher student loan debt in the future. The cost was massive, pegged at around half a trillion dollars. It was also regressive, benefiting high earners more.
But even though student loan forgiveness was terrible policy, the most important takeaway is that the Court majority determined that there was standing to sue, and that the Secretary of Education didn’t have the authority to implement the Biden administration’s plan.
Striking down the student loan forgiveness plan was the best possible scenario. However, whether it will stick as precedent for future cases remains to be seen. The worry is that until the federal government gets out of the student loan market, there is no long-term solution. Policies are proposed and implemented so quickly that it’s like watching a whiplash-inducing game of ping pong. “Progressives will continue to throw anything and everything at the wall, hoping something sticks,” says Gillen, “[a]nd if there is a more permissive statute somewhere, or a change in the balance of the Supreme Court, it’s only a matter of time before something does stick.”
There are still plenty of problems that plague academia, many of which are caused by excessive legislative overreach and progressive political activism on campus. “The federal government’s policies are the single biggest factor in the ruinous increase in college costs, including both tuition and student fees, in the last thirty years,” reads our policy recommendations in Freedom to Learn. The loan forgiveness case isn’t the first, or the last, attempt by the government to meddle in the affairs of higher education. Unsurprisingly, the Biden administration has already announced a new student loan forgiveness plan, so we will wait to see the snags the plan runs into (which it certainly will).
It will take time to digest the implications of this decision, much like those of the Students For Fair Admissions decision. The hope is always that higher education will come out better and stronger in the long run—with a return to upholding the values necessary to give students the best possible education.
Until next week.
CounterCurrent is the National Association of Scholars’ weekly newsletter, written by the NAS Staff. To subscribe, update your email preferences here.
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