Will Student Loan Forgiveness Survive SCOTUS?

Happy Monday! It’s been a rough season for Steve’s Green Bay Packers, a fact Declan has pointed out repeatedly in these digital pages over the last few months. So when Declan’s Chicago Bears lost yesterday to the struggling Packers for the second time this year, you’d think he would have included that fact somewhere—anywhere—in today’s TMD, just out of a sense of fairness, right? Wrong. The TMD final morning edit exists to catch such oversights and to provide the additional context that with the victory, and despite the down year, the Packers are now the winningest franchise in NFL history. 

Quick Hits: Today’s Top Stories

• The Group of Seven and the European Union agreed Friday to ban Western companies from financing, insuring, and shipping Russian oil sold above $60 per barrel—an unprecedented sanction intended to erode the Kremlin’s oil profits while keeping its supply on the market. India and China haven’t joined the price cap, which will reportedly adjust to remain 5 percent below market price. The European Union and United Kingdom are also set to ban Russian crude imports today, but OPEC+—the oil producers cartel led by Saudi Arabia and Russia—announced no immediate production increase in response to the moves. Russian Deputy Prime Minister Alexander Novak said Sunday the Kremlin won’t export oil under the cap—even if it means cutting its production. In an effort to blunt the impact of sanctions, Russia has reportedly secured about 103 tankers this year to ensure it can continue shipping oil.
• North Carolina’s Moore County Sheriff Ronnie Fields announced a mandatory curfew Sunday after about 40,000 customers in the county lost power due to gunfire damage and apparent vandalism at power substations Saturday night. Authorities haven’t yet identified suspects or motives, but the FBI has joined the investigation. County schools canceled classes Monday and, according to Duke Energy, restoring power could take until Thursday for some customers. 
• Iranian Attorney General Mohammad-Jafa Montazeri reportedly said Saturday the country is considering changing its law requiring hijabs and has reduced its morality police enforcement of religious laws—but Montazeri doesn’t control the morality police and state-run media have denied reports that the morality police will be disbanded entirely. “There are methods of implementing the constitution that can be flexible,” Iranian President Ebrahim Raisi said in a televised speech over the weekend. The September death in custody of 22-year-old Mahsa Amini, detained by morality police for allegedly violating the hijab law, has sparked months of nationwide street demonstrations, in which hundreds of protesters have reportedly been killed. 
• The Labor Department reported Friday that U.S. employers added 263,000 jobs in November—above economists’ predicted 200,000 but below October’s 284,000—and unemployment remained near half-century lows at 3.7 percent, despite high-profile layoffs at companies like Amazon and Meta. Average hourly earnings rose 5.1 percent year-over-year and 0.6 percent month-over-month.
• The Democratic National Committee’s Rules and Bylaws panel on Friday voted to adopt President Joe Biden’s plan to move the South Carolina primary to the front of the party’s presidential nomination calendar—supplanting Iowa’s long-influential caucus—followed by New Hampshire, Nevada, Georgia, and Michigan. Though still pending full DNC approval, the change would elevate South Carolina’s primary—which played a crucial role in Biden’s 2020 primary victory—over Iowa’s caucus system, which Biden and Democratic activists have argued disadvantages hourly wage workers who can’t take time off for longer, in-person caucus deliberations. South Carolina also has a larger population of black voters than Iowa or New Hampshire.
• Russian forces continued launching ground attacks around the city of Bakhmut in Ukraine’s eastern Donbas region over the weekend in an apparent attempt to encircle the city and retake it as a launching pad for further gains in Donbas. Kremlin spokesman Dmitry Peskov said Saturday that Russian President Vladimir Putin will visit Donbas—a focal point for Russian forces after their withdrawal from Kherson in the south—but did not provide additional details.
• Twitter moderation staff reportedly responded to requests by the Trump White House and Biden presidential campaign to remove particular tweets, according to reported internal documents journalist Matt Taibbi released this weekend. The documents include discussion of Twitter’s decision in the days leading up to the 2020 election to censor tweets and direct messages sharing information about Hunter Biden’s laptop before reversing itself days later. Though then-candidate Biden initially dismissed reporting about the laptop as a “Russian plant,” media outlets have verified portions of its contents.
• The United States ended its first run in the World Cup since 2014 on Saturday with a 3-1 loss to the Netherlands in the knockout round of 16. Many of the U.S. team’s young members may return for the 2026 World Cup, where they’re scheduled for their first game against Serbia on home turf in Los Angeles.

Will Biden’s Student Loan Program Survive SCOTUS?

President Joe Biden’s controversial student loan cancellation program is on life support. Already blocked temporarily by a lower court, the estimated $400 billion plan could have its plug pulled for good after the Supreme Court on Thursday agreed to hear a challenge to the constitutionality of the program. Oral arguments are set for February, and the debt relief will remain on hold until at least that point.

As we noted back in August, Biden’s program pledged to wipe out up to $20,000 in federal student loans for certain borrowers, and $10,000 for most. If that sounds like it’d be difficult to get through an evenly divided Congress, that’s because it would be. Biden didn’t even try, instead claiming he had the power to cancel the debt himself under the arcane 2003 Higher Education Relief Opportunities for Students (HEROES) Act. Passed as thousands of soldiers were deployed to the Middle East after the September 11 attacks, the act empowers the Secretary of Education to “waive or modify” the financial assistance terms of borrowers affected by “a war or other military operation or national emergency.” In this case, the national emergency the administration cited was the COVID-19 pandemic.

Unsurprisingly, the program has elicited a number of legal challenges. And although the Education Department has thus far approved 16 million of the 26 million applicants for forgiveness, no debt relief has been disbursed. The 8th Circuit Court of Appeals is responsible  for that, as well as for the Department of Education’s decision to temporarily stop accepting any more applications for forgiveness. Education Secretary Miguel Cardona blamed “callous efforts” and “baseless lawsuits” for the pause, arguing the 8th Circuit’s injunction would cause “tremendous financial uncertainty for millions of borrowers who cannot set their family budgets or even plan for the holidays without a clear picture of their student debt obligations.”

It’s likely for that reason the administration last month decided to extend the pause on federal student loan payments—previously set to end January 1—until 60 days after courts resolve legal challenges to the administration’s debt forgiveness plan or until September 1, whichever comes soonest. Legal experts don’t think borrowers hoping for debt cancellations should be optimistic.

That the justices declined to block the 8th Circuit injunction preventing the funds from going out signals “a majority of the Court thinks the lower court got it right,” Josh Blackman, a law professor at South Texas College of Law Houston, told The Dispatch.

The particular challenge the court will hear—Biden v. Nebraska—comes from six Republican-led states alleging that Biden overstepped his constitutional authority with the action and that the program would cost them tax revenue. A provision in the American Rescue Plan prevents states from taxing federal loans that are canceled through 2025.

U.S. District Judge Henry Autrey, a George W. Bush appointee, initially dismissed the states’ case on the grounds that they didn’t have “standing”—the legal right to sue. To have standing, a plaintiff must show that they have been or would be directly harmed as a result of the government action. 

The states found a warmer reception for their case when they appealed to the U.S. Court of Appeals for the Eighth Circuit, which issued the injunction.

The Eighth Circuit honed in on a particular nonprofit organization that handles federal loans, the Missouri Higher Education Loan Authority, or MOHELA, which—if the loan program goes through—might struggle to then make payments to the state of Missouri.

MOHELA helps fund the state’s financial aid program, and if the program “canceled” millions of loans, the organization’s ability to carry out the financial aid program would be impacted, the states said.

The Eighth Circuit did not dive too deeply into the constitutionality of the administration’s actions, at one point noting that the “merits of the appeal before this court involve substantial questions of law which remain to be resolved.”

Then came U.S. Solicitor General Elizabeth Prelogar’s request in November for the high court to let the program march forward while litigation worked its way up through the lower courts. The administration also defended the program along predictable lines: That the states lack standing and that the HEROES Act gives the executive branch the authority to implement the program. 

Lawyers for the states argued in response to the request that the justices should not swallow the administration’s justification of the coronavirus pandemic, and pointed out that the court had not been amenable to the pandemic-as-justification for sweeping executive action in two other cases: the eviction moratorium and a requirement that some employers enforce a vaccine or testing mandate for employees.

The states also accused the Biden administration of using the COVID-19 pandemic as mere “pretext” for a larger political motive: “fulfilling his campaign promise to eliminate student-loan debt.”

The states also argued that the administration’s actions violate the major questions doctrine. The doctrine is animated by the idea that administrative agencies should only implement policies that Congress has expressly authorized. Congress has declined “repeatedly” to discharge student loans, the states maintained, so the administration’s unilateral action runs afoul of the doctrine.

“I think the justices will bring up the fact that this seems mostly about student debt relief for which Congress has not legislated,” said Adam White, a senior fellow at the American Enterprise Institute. “If this really is about broad sweeping reform of student debt, that doesn’t seem like the kind of thing that the HEROES Act was created to actually do.”

But one thing that may work in Biden’s favor is the generally ambiguous nature of Congress: “The fact that the statute at issue—the HEROES Act—is written in extremely broad terms,  there’s a nonfrivolous argument that the HEROES Act allows this program,” White said, noting that he disagrees with that argument on the merits.

Caleb Kruckenberg, the lead attorney with Pacific Legal Foundation on another lawsuit over the loan relief program, thinks the Supreme Court’s decision to litigate the case—rather than simply vacate the injunction—is a positive sign for the plaintiffs.

“I’m going to do what every lawyer says you should never do, and I’m going to just make a prediction, because I think it’s pretty clear,” Kruckenberg said. “I think the Supreme Court is going to rule, probably six to three, that loan cancellation is flatly illegal, that it’s not justified under the HEROES Act. And that’s going to be it.”

Worth Your Time

• With Russia attacking Ukrainian power grids as the war grinds on, Ukrainians face a long, cold winter ahead. For The Atlantic, Nadja Halilbegovich recalls surviving three winters with her family under siege decades ago in Sarajevo, Bosnia. “On the rare occasions when the electricity came back on, we were stunned by the lights and noises from our now useless appliances,” Halilbegovich writes. “The dishwasher had become a locker for our paltry supply of pasta, rice, and lentils; the washing machine had not run for months. With the power back on, we scrambled to complete as many chores as we could. … My brother and I would be in a frantic rush to finish all our household tasks because we longed to watch just a few minutes of MTV or the movie Top Gun, which we had on VHS.” Alongside suffering, Halilbegovich recalls singing lessons, books, and black humor helping them live amid the siege. “My hope is that [Ukrainians] will survive the hardship to experience the moment we Sarajevans dreamt of in the darkest days of winter: Despite the war’s infinite callousness, at the spring’s first thaw, we walked into the sunlight and warmed our faces. We were weary and scarred—but unbroken.”
• This story in the Wall Street Journal about a military wife and mom who spiraled into meth addiction—and found her way back out—will stick with you. Lauren St. Pierre was sipping wine with a mom friend and mentioned the woman’s seemingly boundless energy as she raised two teenagers and kept a spotless house. The friend brought Lauren into the kitchen and gave her the first hit. “Lauren had been using the drug for a couple of months when she sat her husband, David, on the couch and announced she was leaving him,” reporter Michael Phillips writes. After continued addiction and abuse, she wound up behind bars and got clean. “Lauren steered clear of the meth smuggled into Vandalia prison. It was easy to spot users. They were the ones up at 3 a.m. arguing over who got to use the broom. On visiting days, Lauren could hold her son, Ethan. [Lauren’s mother] Tracy would buy Lauren hot dogs, and the boy got powdered-sugar doughnuts from vending machines. The prison had an outdoor playground with a dinosaur slide and swings. ‘I just love this place,’ Ethan told Tracy. ‘It’s my favorite place in the world. I get to see my mommy.’”

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Toeing the Company Line

• The hits keep coming for GOP Leader Kevin McCarthy as he seeks the speaker’s gavel, Haley and Audrey report in Friday’s Uphill (🔒). Far-right members are announcing their opposition as moderate Republicans say they’re discussing with Democrats what to do if McCarthy can’t earn enough votes.
• Florida Gov. Ron DeSantis’ best path to victory in a presidential primary against Donald Trump may be silence, Nick argues in Friday’s Boiling Frogs (🔒): “Just as he’s done with the [Kanye/Fuentes] dinner at Mar-a-Lago, he’ll sit back, raise an eyebrow, and let Trump go about punching himself in the face.”
• It’s decision time (again) in Georgia this week as voters head to the polls for the runoff between Democratic Sen. Raphael Warnock and GOP Senate candidate Herschel Walker. Warnock looks set to clinch a win, Chris writes in Friday’s Stirewaltisms (🔒), but could this midterm season have another surprise in store?
• Jonah skips right past rehashing why antisemitism is bad in Friday’s G-File and instead explores why it’s just plain dumb. A secret conspiracy of Jews working together to run the world? If you know a lot of Jews, the very idea is ridiculous, Jonah writes—though that doesn’t stop the conspiracy theorists from pushing their non-falsifiable claims.
• After a fall from grace, repentance from leaders—especially Christian ones—shouldn’t automatically lead to a restoration of power, David argues in Sunday’s French Press. “When a powerful person doesn’t just ask for forgiveness but also seeks restoration to the life they lived before,” he writes, that’s a “clear warning sign that repentance isn’t real.”
• A few weeks after their deeply disappointing midterm performances, Republicans are starting their post-mortem and picking up the pieces, Audrey reports on the site this weekend. Looming questions about candidate quality, mail-in voting, minority outreach, and the post-Roe v. Wade world all have implications for how the GOP might approach the next two years.
• And in the culture section this weekend, Guy Denton explores the work of former pop star and current avant-garde recluse David Sylvian, and Jim Lafferty celebrates actor Michael J. Fox’s offscreen work supporting Parkinson’s disease research and raising a family.

Let Us Know

How do you think SCOTUS should rule on student debt forgiveness?