Student Loan Forgiveness – Will It Fly?

by Emmanuel S. Tipon, Esq.

President Biden has shown compassion for students who borrowed heavily to finance their higher education by announcing that the federal government will forgive hundreds of billions of dollars in student loans. Aug. 25, 2022. About 26 million borrowers have reportedly applied for the loan relief.

But does the President have the power?

And is it fair to the students who (a) borrowed money for higher education and have paid their loans, or (b) never borrowed money for their higher education, or (c) did not seek higher education but borrowed money to finance a business?

These issues are now before the Supreme Court in Biden v. Nebraska, No. 22-506, which was argued on February 28, 2023.

Presidential power to cancel debt
The Secretary of Education, in carrying out the President’s directive, announced that the government would discharge the balance of a borrower’s loan up to $10,000 for people earning less than $125,000 per year, or $250,000 per household, and $20,000 for those who received Pell Grants for low-income families.

The Executive Department invoked the Higher Education Relief Opportunities for Students (HEROES) Act of 2003 that was enacted after the September 11, 2001 terrorist attacks on the Twin Towers in New York, providing debt relief for the brave men and women fighting the war on terror. Pub. Law No. 108-76.

The Act authorizes the Secretary to “waive or modify any statutory or regulatory provision applicable to the student financial assistance programs under title IV of the [Higher Education Act of 1965] as the Secretary deems necessary in connection with a war or other military operation or national emergency to provide the waivers or modifications authorized.”

The authorized waivers or modifications are for “affected individuals.” Affected individuals are those serving in the military or the National Guard; living or working in an area declared a “disaster area” in connection with a national emergency; or suffering “direct economic hardship as a direct result of”, a war, military operation, or national emergency.

The Act does not say anything about loan forgiveness.

The Executive claims that the COVID-19 pandemic is a national emergency that justifies the loan-forgiveness program. As they say in Tagalog “palusot”.

But the States say that if Congress wanted the HEROES Act to empower the Secretary to cancel student-loan debt, it needed to do so clearly. But it failed to do so. Furthermore, the pandemic is over.

The States challenging that action claim that the Secretary’s act is ultra vires and adds to the federal deficit – between $400 and $519 billion out of the $1.6 trillion student debt currently owed. The States claim that they have compelling interests in objecting to the violation of the separation of powers. They claim that no law permits the President to cancel student loan debts and that the President has no inherent constitutional authority to forgive student debt. Accordingly, the loan-forgiveness program is illegal.

The States claim that the Executive’s pandemic argument is merely a pretext. The President previously claimed that the loan forgiveness program is a fulfillment of a “campaign commitment” – motivated by the belief that “the cost of borrowing for college” imposes “a lifelong burden that deprives” borrowers of the chance to build “a middle-class life.”

Chief Justice Roberts and a majority of the Justices seemed skeptical of the President’s plan to wipe out student debt, the Chief  saying that “that’s something for Congress to Act on.”

The Supreme Court decision, expected in June, has far-reaching consequences more than just student loan forgiveness. If Biden wins, it will alter the balance of power among the three branches of government. It will be an unbridled license for the Executive  to do whatever he wants, with or without a law to support him.

The fairness question
During the oral argument, Chief Justice Roberts and other conservative justices addressed “the fairness argument”. Loan forgiveness punishes those students who did not go to college or paid off their loan by working hard.

Roberts said: Suppose there are two high school graduates, neither of whom could afford to go to college. One obtained a loan to attend college, the other took out a loan to start a lawn care business. At the end of 4 years the college educated person will do significantly better financially than the person who did not go to college. And then the government tells the college educated person that you do not have to pay your loan. But leaves the lawn care person stuck with his debt.

ATTY. EMMANUEL SAMONTE TIPON was a Fulbright and Smith-Mundt scholar to Yale Law School where he obtained a Master of Laws degree specializing in Constitutional Law. He graduated with a Bachelor of Laws degree from the University of the Philippines. He placed third in the 1955 bar examinations. He is admitted to practice before the U.S. Supreme Court, New York, and the Philippines. He practices federal law, with emphasis on immigration law and appellate federal criminal defense. He was the Dean and a Professor of Law of the College of Law, Northwestern University, Philippines. He has written law books and legal articles for the world’s most prestigious legal publisher and writes columns for newspapers. He wrote the best-seller “Winning by Knowing Your Election Laws.” Listen to The Tipon Report which he co-hosts with his son Attorney Emmanuel “Noel” Tipon.  They talk about immigration law, criminal law, court-martial defense, politics, and current events. It is considered the most witty, interesting, and useful radio show in Hawaii. KNDI 1270 AM band every Thursday at 8:00 a.m.  Atty. Tipon was born in Laoag City, Philippines. Cell Phone (808) 225-2645.  E-Mail: Website:

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