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The Education Dept's legal counsel put out a memo explaining that "no, in fact a President cannot unilaterally cancel debts across the board", but apparently Ed Markey didn't get that memo.
And why won't ED draft legislation that cancels debt if that's what he wants to do? https://twitter.com/SenMarkey/status/1357361354101899270
And why won't ED draft legislation that cancels debt if that's what he wants to do? https://twitter.com/SenMarkey/status/1357361354101899270
This is a memo from the Education Department's general legal counsel to the SecEd at the time highlighting 3 key issues that I've yet see senators even recognize, let alone overcome.
Let's run through the memo. Maybe @AkivaMCohen or @questauthority will help with the legalese.
Let's run through the memo. Maybe @AkivaMCohen or @questauthority will help with the legalese.
https://www2.ed.gov/about/offices/list/ope/ogcmemohealoans.pdf
First paragraph is counsel acknowledging here that Ed Sec asked for a review of policy due to the national emergency from COVID.
First paragraph is counsel acknowledging here that Ed Sec asked for a review of policy due to the national emergency from COVID.
In the second paragraph, counsel explains that SecEd asked them to review whether or not she had the authority to do so with the DOJ, and they determined that she didn't, even with the additional powers granted by the HEROES Act and the CARES Act.
But why?
But why?
This paragraph spends a lot of time to make a simple point: If it's not expressly stated, it cannot be done. In short, if Congress wanted the POTUS to unilaterally have the ability to cancel debt, they'd give it to him. Until they don't, he doesn't have it. Nor do his "agents".
This paragraph explains that no only is it not in the purview of the Secretary to CANCEL debt, they are obligated by law to collect it.
Part B is where legal counsel is explaining that you cannot arbitrarily change the definitions of words to meet your criteria after the law has been passed. "ordinary public meaning" of the HEA... well, let's look at the HEA (I should've done that earlier.)
https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title20-chapter28-subchapter4&edition=prelim
49 times the word "cancellation" is utilized in this pdf. Not once does it say "because they think it's a good idea." In every case, there's a very well-detailed, explicit reason that was understood at the beginning when the law was written.
49 times the word "cancellation" is utilized in this pdf. Not once does it say "because they think it's a good idea." In every case, there's a very well-detailed, explicit reason that was understood at the beginning when the law was written.
"Congress "does not...hide elephants in mouseholes."
If Congress wanted the Secretary of Education to have the ability to cancel student debt for any reason, they would've unequivocably given it to them. As such, this is so far above their paygrade it's ludicrous to ask.
If Congress wanted the Secretary of Education to have the ability to cancel student debt for any reason, they would've unequivocably given it to them. As such, this is so far above their paygrade it's ludicrous to ask.
"Well doesn't the President have the authority?"
No, because of a statute called the Anti-Deficiency Act, which bars the executive branch from spending government money without the appropriate authorization from Congress. As the saying goes "Congress controls the purse."
No, because of a statute called the Anti-Deficiency Act, which bars the executive branch from spending government money without the appropriate authorization from Congress. As the saying goes "Congress controls the purse."
Safe to say that
a) SecED is a "federal agency" and POTUS is a "federal employee"
b) cancelling debt would be "expending federal funds in advance of an appropriation" because taking away an income = expending federal funds
So let's move on.
a) SecED is a "federal agency" and POTUS is a "federal employee"
b) cancelling debt would be "expending federal funds in advance of an appropriation" because taking away an income = expending federal funds
So let's move on.
This paragraph is simple:
1. Federal loans are treasury property granted by Congress
2. Secretary's powers to cancel are limited to only what's in the HEA.
3. If Congress wants to cancel all debt, they should pass a bill authorizing it.
1. Federal loans are treasury property granted by Congress
2. Secretary's powers to cancel are limited to only what's in the HEA.
3. If Congress wants to cancel all debt, they should pass a bill authorizing it.
Now the lawyers do us (the non-lawyers), the favor of explaining why the common arguments don't apply. So we'll run through those now.
Starting with FFEL (20 U.S.C. Sec 1082(a)(6).
Starting with FFEL (20 U.S.C. Sec 1082(a)(6).
At first blush, " ….waive or release any title, claim, lien, or demand" sounds promising. But it doesn't take a lawyer to point out that those aren't LOANS. they're the penalties for default. As the legal-guys will soon point out.
Relevant sections to follow
Relevant sections to follow
Long story short - since Congress has always been very EXPLICIT about what authority Congress has granted a federal employee or agency in terms of cancelling debts, if they wanted them to be able to blanket-cancel, they would've said so. But they didn't.
Another paragraph hammering this point, and an upcoming opinion by the late Anton Scalia (for a unanimous court): if Congress doesn't give it to you explicitly, and in writing, you don't have it.
3 footnotes are mentioned in this paragraph, but I'm going to link one of them, a study done about college loan debt forgiveness en masse. (linking =/= agreement, this is simply providing contextual information)
34 CFR.685.222 (f)-(h) https://www.law.cornell.edu/cfr/text/34/685.222
This is a "borrower defense" resolution program, meaning you got defrauded by the university into paying for something that wasn't what it was represented as. Hard to put your BS on your CV and then claim it was fraud.
This is a "borrower defense" resolution program, meaning you got defrauded by the university into paying for something that wasn't what it was represented as. Hard to put your BS on your CV and then claim it was fraud.
That's what 685.222 does: You're telling the federal government that it was THEM, not you who were conned, and your education isn't worth what they lent you. You COULD argue this, I guess - but considering your job was obtained on that SAME degree, it seems counterproductive.
https://bfi.uchicago.edu/insight/research-summary/the-distributional-effects-of-student-loan-forgiveness/#:~:text=The%20Distributional%20Effects%20of%20Student%20Loan%20Forgiveness%201,on%20income%20accrue%20more%20to%20middle%20income%20earners.
This paper points out what a lot of people have: that cancelling student debt would increase the inequity in financial situations between those that have degrees and those that don't, rather than reduce it. Especially if they are post-graduate degrees.
This paper points out what a lot of people have: that cancelling student debt would increase the inequity in financial situations between those that have degrees and those that don't, rather than reduce it. Especially if they are post-graduate degrees.
I'm not going to discuss the paper further in this thread, but it's there if you want to review it. Let's move on with the memo.
The next paragraph explains that Congress narrowly defined the actions a secretary could take: (cleverly titled: 20 USC Sec 1098bb(a)(2) - Actions Authorized
Note the highlighted "under Title IV of the Act", because it's important in this case.
Note the highlighted "under Title IV of the Act", because it's important in this case.
The last one has nothing to do with borrowers, it's allowing SCHOOLS located in disaster zones not to have to meet their reporting deadlines. I just put it here for consistency.
The interesting part here is "if the national emergency had not have happened", which means that even in the most BROAD reading of this, only people who lost their jobs would be eligible for cancellation under the HEROES Act.
The fact that modify=/=cancel may surprise some.
The fact that modify=/=cancel may surprise some.
"Congress told you that the loans have to be paid, and being they told you so, only they can change it."
"No POTUS can't do it either."
All of this is boiling down to a simple point: CONGRESS can pass a bill cancelling as little or as much debt as they want.
"No POTUS can't do it either."
All of this is boiling down to a simple point: CONGRESS can pass a bill cancelling as little or as much debt as they want.
See above, more of the same.
Congress can fix this at any time, if they choose to.
Next they nail down the "What about the President?" part.
Congress can fix this at any time, if they choose to.
Next they nail down the "What about the President?" part.
Since the public law doesn't allow it, the President can't do it on his own. Otherwise, he's violating his oath of office.
"Even IF the Secretary were granted this power, it doesn't mean that it grants it to the President. It's defined as a "rule" since it includes the approval of the future of rates..."
https://www.law.cornell.edu/uscode/text/5/551
https://www.law.cornell.edu/uscode/text/5/553
https://www.law.cornell.edu/uscode/text/5/551
https://www.law.cornell.edu/uscode/text/5/553
I think we can safely say that POTUS cancelling debts = changing the future of rates and wages. Because of that, that means that Sec 553 has to be met.
Which means -you have to explicitly site the legal authority under which your rule is proposed.
Which means -you have to explicitly site the legal authority under which your rule is proposed.
And I'm fairly certain "because I'm the MFing POTUS!" isn't a "legal authority" in that sense.
So conclusions:
First and foremost, I hear you yelling that "That was Trump's lawyer!"
The problem is that the legal arguments aren't based on his name, or his position. They reference dozens of legal precedence to form their position, and seem at first blush to be sound.
First and foremost, I hear you yelling that "That was Trump's lawyer!"
The problem is that the legal arguments aren't based on his name, or his position. They reference dozens of legal precedence to form their position, and seem at first blush to be sound.
So we can't disregard Rubenstein's arguments solely on the basis of who made them.
Of course, we ALSO have to take into account the judicial landscape right now in how these briefs will be considered.
Of course, we ALSO have to take into account the judicial landscape right now in how these briefs will be considered.
But what I think is an even bigger problem is "anything done by executive order can be undone by executive order". Meaning the next POTUS could simply "uncancel the debt", or direct their EdSec to.
This is no way to run a country, especially when it involves people's finances.
This is no way to run a country, especially when it involves people's finances.
