Biden administration tells student loan forgiveness applicants it is ‘confident’ in face of Supreme Court skepticism

CNN, KTVT

By Phil Mattingly, Allie Malloy and MJ Lee, CNN

The Biden administration is projecting confidence about the fate of President Joe Biden’s student loan cancellation program in a message to applicants, even in the face of skepticism from conservative Supreme Court justices in Tuesday’s high-stakes oral arguments.

Education Secretary Miguel Cardona said in an email sent to millions of borrowers who applied for debt cancellation that the administration “mounted a powerful case” in support of Biden’s executive action.

“Our Administration is confident in our legal authority to adopt this plan, and today made clear that opponents of the program lack standing to even bring their case to court,” Cardona wrote in the email update obtained by CNN.

The email update to applicants reflects a position administration officials have maintained in the wake of the oral arguments. But it also implicitly lays out the administration’s view of the political dynamics of a move that has became an immediate partisan flashpoint. As applicants and administration officials alike settle in for what will likely be months of waiting for a final decision, the update sent to roughly 7 million people also provides a window into the reach the administration would have to frame the debate — and consequences — should the program be struck down.

Cardona’s message comes as millions of borrowers remain in limbo as they await a Supreme Court decision on whether Biden’s action to cancel up to $20,000 in student loan debt will stand.

White House officials, who closely monitored the oral arguments in two challenges, have maintained the position that they will ultimately prevail in the cases that challenge Biden’s authority to discharge millions of dollars in federally held loans. While they remain confident on the merits, sources continue to highlight the view inside the administration that the plaintiffs lack standing to bring the challenges — which would render the arguments over the authority itself moot.

One source familiar told CNN that the White House remains confident that things will go their way, simply saying: “We’ll win.”

A particular flashpoint in the hearing was the states’ arguments that the loan forgiveness program’s potential harms to MOHELA — the Missouri-created entity that services loans in the state — gives Missouri standing.

Justice Amy Coney Barrett stood out among the conservatives for asking particularly pointed questions of the GOP states about their standing arguments, setting her apart as a potential pickup vote for the court’s three liberal members.

“If MOHELA is an arm of the state, why didn’t you just strong-arm MOHELA and say you’ve got to pursue this suit,” Barrett asked Nebraska Solicitor General James Campbell.

The question was one of several directed at Campbell, who represented the group of Republican-led states that argue the administration exceeded its authority, about the states’ standing claims.

Another source familiar said that Barrett’s comments only raised optimism within the administration.

But as several conservative justices leveled sharp questions related the government’s authority on the matter, Cardona’s update appeared intended to assuage overarching concerns.

It also previewed a political contrast officials will likely elevate should Supreme Court strike down Biden’s actions — one White House officials have repeatedly pressed as the challenges have made their way through the courts.

“While opponents of this program would deny relief to tens of millions of working- and middle-class Americans, we are fighting to deliver relief to borrowers who need support as they get back on their feet after the economic crisis caused by the pandemic,” Cardona wrote.

Biden’s plan would cancel as much as $10,000 in federal student loan debt for people earning less than $125,000 a year, or less than $250,000 for married couples. Individuals on Pell Grants could see up to $20,000 forgiven. In all, more than 40 million federal borrowers would qualify for some level of debt cancelation, with roughly 20 million who would have their balance forgiven entirely.

The Biden administration received 26 million applications for the program, which has been frozen as the court battles have played out, and more than 16 million applications had already been approved.

Cardona reiterated that a pause on federal loan payments, which was implemented during the Trump administration in response to the pandemic and was set to restart at the same time cancellation was implemented, remain on hold as the Supreme Court deliberations play out.

“While we await the Supreme Court’s decision, the pause on student loan payments remains in effect,” Cardona wrote. “Payments will resume 60 days after the Supreme Court announces its decision.”

If the litigation is not resolved by June 30, payments are scheduled to resume 60 days after that date. If it has not made a decision or resolved the litigation by June 30, payments will resume 60 days after that.

The Supreme Court’s decision is expected to come this summer.

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