To Make Debt Relief a Reality, We’ll Need to Reform the Supreme Court

While tens of millions of U.S. debtors have eagerly applied for relief, the Biden administration’s student loan cancellation plan is now mired in legal limbo after a Trump-appointed judge claimed that the executive branch lacked the authority to enact such a program. When Biden first announced the plan, which would provide up to $10,000 in student debt relief for those making under $125,000 and up to $20,000 of relief for Pell grant holders, debtors and left-wing organizers rejoiced. The program was a victory for grassroots groups like Debt Collective and Strike Debt!, which have been steadfastly advocating for debt cancellation for years. Meanwhile, Republicans and sleazy conservative outfits have filed a number of lawsuits challenging its constitutionality on the grounds that the program, which would cost a mere $400 billion over the course of 30 years—about half of what the United States spends on the Pentagon in a single year — is a case of the president bypassing Congress’s ​“power of the purse.”

The Supreme Court announced on December 1 that it will hear oral arguments in February for a case challenging the constitutionality of the program. It’s unclear whether a majority of justices on the conservative-dominated Supreme Court will find it in their hearts to reject the flimsy litigation (though experts expect them to strike down the plan), but the challenge has already ground the first steps at widespread student debt cancellation to a halt. As a result, debtors have been left unsure of whether they will remain on the hook for the amounts covered under the program, which was itself inadequate, canceling just a fraction of the $1.6 trillion in federal student loans held by around 43 million people nationwide. In May 2022, when the program was first announced, NAACP president Derrick Johnson declared that ​“canceling $10,000 in student debt is like pouring a bucket of ice water on a forest fire. In other words, it won’t do anything, especially for the Black community.” Biden’s quarter-measure pales in comparison to Bernie Sanders’ plan to cancel all student debt without exception.

The Biden program’s tepid moderation notwithstanding, it was a step forward: it established a precedent for further debt relief and provided a clear, specific example of how people’s lives can concretely be improved through politics. The Republicans’ legalistic objections to student debt relief are clearly made in bad faith. Their true qualms about the legislation stem from the GOP representing the interests of private loan companies and elites who are invested in stoking cynicism about government’s capacity to change people’s material conditions for the better.

But two can play at technicalities. If establishment Democrats were genuinely interested in putting student debt relief on a solid legal foundation, Congress could theoretically act to pass a student debt relief law, thereby depriving the Republicans of their ​“power of the purse” objection and obviating the lawsuits that are currently in progress. And they could do so this month, while both houses are still under Democratic control, with the same remarkable alacrity that Congress used to pass a flagrantly anti-worker compromise to prevent a nationwide rail strike. There is a precedent for such action. When oil industry regulation during the New Deal era confronted legal challenge and the Supreme Court found it unconstitutional, a new law passed by Congress succeeded where the previous statute had failed.

The current Supreme Court’s decision to strike down Roe v. Wade—and a slew of other anti-democratic decisions which fly in the face of public opinion, including Citizens United, which opened the floodgates for dark money in elections, and the Janus case, which kneecapped labor unions—have led to calls from some progressives for ​“court packing,” i.e. adding justices who would counter the conservative majority. But Joe Biden, an institutionalist to his core, has shown almost no enthusiasm for court reform. The most his administration has done is convene a 34-person bipartisan panel whose 280-page report, released in December 2021, has yet to even be favored with public comment from Biden.

Moderate Democrats like Biden will always find themselves on losing terrain when they accept our political system and its labyrinthine limitations as a given. Take, for example, the Democratic establishment’s unconscionable and completely unnecessary deference to the unelected Senate parliamentarian, which caused them to punt on a $15 an hour minimum wage; their incapacity to end the filibuster, which has strangled countless progressive initiatives; and their failure to pass the desperately necessary Democracy Act to overhaul our dilapidated electoral and legislative machinery, which allows gerrymandering, state-level voter suppression schemes, and the systematic underrepresentation of Puerto Rico, the U.S. Virgin Islands and Guam to continue unabated. One could ascribe this to mere political ineptitude from House Speaker Nancy Pelosi, Senate Majority Leader Chuck Schumer and the rest of the Democratic Party’s ancien régime. Less charitably, corporate Democrats’ inaction could be interpreted as structural — an unsurprising extension of their personal class interests and the interests of their rich patrons.

Setting such motivations aside, the legal setbacks for Biden’s student debt cancellation plan underscore an important point for the Left. Changes to the Supreme Court and other unsexy structural reforms are just as important as popular, grassroots mobilization if we want to realize the fundamental progressive changes this country urgently needs. History bears this out: the New Deal era was the last time transformational programs of the scope that we need today were passed, and the Supreme Court ruled many of President Franklin D. Roosevelt’s most important programs unconstitutional until he threatened to pack the court, prompting a leftward shift and rescuing the remainder of the New Deal from judicial reversal. Political theorists Samuel Moyn and Corey Robin have argued cogently that the Constitution’s fierce opposition to true, genuinely representative democracy and the straitjacket it imposes on governmental action are among the most severe pathologies of American politics. They set a hard limit on the kinds of progressive reforms that can be enacted, dooming us to reenact the past.

The short-term fix to the crisis of student debt, and Americans’ more general indebtedness — which entails about $200 billion in medical debt, $925 billion in credit card debt, $1.75 trillion in student debt and $1.42 trillion in car loan debts — would be quite simple: a debt jubilee where the federal government cancelled all debts. Summing up those figures, we can estimate that such a program of general debt relief could cost around $4.3 trillion, but that pales in comparison to the $5.8 trillion that the Pentagon, which recently failed its fifth audit in a row, has spent on the wars in Afghanistan and Iraq. And the social, economic, and cultural benefits of liberating every American from debt would be immense, providing a tremendous fillip to democracy and human happiness which could then spur longer-term fixes. These could include enacting Medicare for all to prevent the stranglehold of medical debt, guaranteeing debt-free public college for all to make student loan debt a thing of the past and adopting countless other social democratic reforms.

As long as our corrupt political system renders bold redistributive legislation impossible, and as long as centrist and neoliberal Democrats oppose the sweeping policies necessary to truly resolve the debt crisis, such measures will remain utopian; piecemeal charity programs like RIP Medical Debt will be the best we can do. But a society liberated from debt, in the short, medium, and long terms, is a worthy vision to galvanize organizing. Left-wing candidates and organizers should talk openly about debt relief and rake Republicans and corporate Democrats over the coals in the court of public opinion. Only by enacting comprehensive relief will we be able to banish the oppressive role of debt once and for all, creating new political space for bold action.