SCOTUSblog: When the president takes lawmaking matters into his own hands, the court must step in

February 23, 2023 | By ELIZABETH SLATTERY
Supreme court with cloudy sky

Every presidential administration reaches a point where the president is tempted to take lawmaking matters into his own hands. “I’ve got a pen and I’ve got a phone,” Barack Obama famously put it. Frustrated by a Congress that can’t or won’t accede to their preferred policies, presidents turn to executive orders and executive agencies to achieve their goals. Although the motive might be characterized as a president’s impatience with the political process or dissatisfaction with likely compromises, our history books are filled with instances of presidents acting unilaterally — Harry Truman’s seizure of the nation’s steel mills during the Korean War, Richard Nixon’s attempt to impound congressionally appropriated funds, and Abraham Lincoln’s wartime suspension of the writ of habeas corpus.

More recently, after Congress refused to appropriate funds for construction of a border wall, Donald Trump declared a national emergency to divert $6 billion in military spending for the project. He also ordered a nationwide eviction moratorium early in the COVID-19 pandemic, which was later extended by Joe Biden. Similarly, with the stroke of a pen, Obama implemented an amnesty plan for more than 800,000 Dreamers and attempted to restructure the nation’s energy sector with his Environmental Protection Agency’s Clean Power Plan. Throughout history, the courts have played a crucial role of enforcing the separation of powers when presidents overstep their constitutionally assigned duty and assume the role of legislator.

Biden, like his predecessors, struck out on his own last summer when his administration announced a new student-loan cancellation program: up to $20,000 of federally held debt wiped out for borrowers who earn less than $125,000. Like Obama’s Clean Power Plan, the Trump-Biden eviction moratorium, and Biden’s vaccine mandate, the loan-cancellation plan rests on dubious legal ground. The Biden administration located a previously untapped source of authority in the HEROES Act of 2003, a law passed in the early days of the Iraq War to temporarily freeze student loans held by servicemembers and their families during times of war or national emergency. The law was intended to ease certain bureaucratic burdens (for example, by extending grace periods and waiving documentation requirements) so servicemembers and their families would not be placed in a worse financial position because of a deployment.

The statutory language, however, is not limited to servicemembers and their families. It allows the secretary of education to waive or modify student-loan requirements for those residing or working in a disaster area related to a war or national emergency who would otherwise be in a worse position financially. The Biden administration says this applies to every person in the United States with an eligible student loan and relies on the COVID-19 pandemic as the national emergency to justify its action. And despite Biden’s remark just weeks after announcing this plan that “the pandemic is over” and the White House’s recent announcement that the national emergency will formally expire on May 11, the administration presses on with this legal pretext.

The plan was rolled out via a handful of press releases, a fact sheet, and two memos — without the standard rulemaking procedure that includes providing notice of a draft rule and giving affected individuals the opportunity to comment on it. Soon after, the plan was challenged in court by states that service federally funded student loans, a borrower who would automatically receive loan cancellation but face a hefty state tax bill, and other borrowers who did not qualify for loan cancellation.

The Biden administration quickly revised its plan to try to avoid judicial scrutiny. It was successful in one case, Garrison v. Department of Education (brought by my colleagues at Pacific Legal Foundation). In response to a question about the forthcoming automatic cancellation for nearly eight million borrowers, White House Press Secretary Karine Jean-Pierre announced that borrowers simply could “opt out” of the program. Though the Education Department website said otherwise, it was quickly edited to fit the administration’s new spin. A federal district judge then dismissed the suit for lack of standing. Just as the Biden administration hopes to wave a wand and wipe out half a trillion dollars in debt, it waved a wand to eliminate one legal challenge (at least for now; the case is on appeal to the U.S. Court of Appeals for the 7th Circuit). The administration was unsuccessful in its attempt to do the same to the states’ suit.

Now two cases are before the Supreme Court.

The Biden administration’s reading of the HEROES Act follows the same playbook as its defense of the eviction moratorium, vaccine mandate, and Clean Power Plan: Stretch a modest grant of power to reach policy goals Congress never approved. As the court explained in its per curiam opinion in the eviction moratorium case, Alabama Association of Realtors v. HHS, “It would be one thing if Congress had specifically authorized the action that the CDC has taken. But that has not happened. Instead, the CDC has imposed a nationwide moratorium on evictions in reliance on a decades-old statute that authorizes it to implement measures like fumigation and pest extermination. It strains credulity to believe that this statute grants the CDC the sweeping authority that it asserts.”

In the vaccine mandate case, National Federation of Independent Business v. OSHA, the court wrote, it “expect[s] Congress to speak clearly when authorizing an agency to exercise powers of vast economic and political significance.” Such clarity was lacking from the statute the Biden administration relied on to mandate vaccination of 84 million Americans. In West Virginia v. EPA, the court elaborated that when the executive branch asserts a “transformative expansion” of regulatory authority, it cannot be through “implicit delegation[,]” “modest words,” or “vague terms.” The executive branch’s discovery in “a long-extant statute an unheralded power” should be viewed with a healthy dose of skepticism — especially when it allows an agency “to adopt a regulatory program that Congress had conspicuously and repeatedly declined to enact itself.”

As in these recent cases, it “strains credulity” to believe the HEROES Act sweeps as broadly as the administration claims. Pacific Legal Foundation’s amicus brief on behalf of the original authors of the bill explains that Congress did not clearly empower the executive branch to cancel half a trillion dollars in federally held student loans, especially not for the type of waning health emergency that existed last summer. Congress authorized waiver or modification of loan requirements in the HEROES Act, not discharge, forgiveness, or cancellation — the language used in other loan-cancellation statutes like the one creating the Public Service Loan Forgiveness program.

Both the Trump and Biden administrations relied on the HEROES Act to temporarily pause repayment and accrual of interest on federally held student loans in response to the COVID-19 pandemic. And in January 2021, the Education Department’s general counsel issued a memorandum concluding that the HEROES Act did not grant the secretary authority to cancel loans or materially modify repayment amounts or terms. Thus, until last summer, the HEROES Act had never been used to cancel loans. This is precisely the sort of “pouring new wine from old bottles” that the Supreme Court has rejected in recent cases.

How to address the ballooning cost of higher education and what — if anything — the government should do about the estimated $1.75 trillion in student debt is a controversial and fiercely debated topic. The Biden plan arbitrarily caps eligibility based on borrowers’ income level and would cancel a blanket amount of $20,000 for Pell Grant recipients and $10,000 for all other eligible borrowers. Perhaps Congress would have chosen differently with respect to the amount of any cancellation, income requirement, and other eligibility factors. That debate belongs with the people’s representatives in Congress, not the president and Department of Education. The Supreme Court should ensure that remains the case.

This op-ed was originally published at SCOTUSblog on February 23, 2023.