AP Photo/Evan Vucci
- Biden hasn't released a memo on his authority to cancel student debt, but new documents show he's had it on his desk since April.
- Trump released a memo in his final days in office that said he could not legally cancel student debt.
- The two administrations could be interpreting the law differently.
In the final days of President Donald Trump's time in the White House, his lawyers told Education Secretary Betsy DeVos that is was illegal for her to broadly cancel federal student loans for 43 million Americans.
Under President Joe Biden, uncertainty on the student-debt cancellation conversation persists. As recently as last month, White House Press Secretary Jen Psaki said she had "no update." But it was recently revealed that the administration has, for six months, been sitting on a memo outlining Biden's legal ability to cancel the $1.75 trillion problem without announcing the results publicly.
During his campaign, Biden told voters he would support canceling $10,000 in student debt per borrower. But when it came to a larger amount, like $50,000, he was unsure of his legal ability to do so. In February, White House Press Secretary Jen Psaki said the administration was "reviewing whether there are any steps he can take through executive action." And in April, White House Chief of Staff Ron Klain said Biden had asked the Education Department to prepare a memo on broad student-debt cancellation, saying it would take a few weeks.
However, seven months have passed with the Biden administration humming the same tune: conversations are ongoing.
"It's a priority for me and for President Biden to make sure that part of the conversation is examining loan forgiveness," Education Secretary Miguel Cardona said at The Atlantic's Education Summit last week. "And those conversations are continuing."
Despite the lack of progress from Biden's camp, the hopes of advocates and indebted Americans still hinge largely upon one thing: whether the administration interprets the law differently than Trump's. For now they're anxiously awaiting an update on that stagnant April memo.
Trump vs. Biden on student debt cancellation
The Debt Collective, the nation's first debtors' union, obtained documents and internal Education Department emails via a Freedom of Information Act request that showed a first draft of the memo - titled "The Secretary's Legal Authority for Broad-Based Debt Cancellation" - has existed since April 5. Internal emails suggested it was circulated among White House leadership on the same day, but it first appeared to the public as six pages of pink redactions this week.
The documents also indicated that on April 8 the word "draft" was removed from the header and the memo assumed a new title that referred to the HEROES Act, the law that both Biden and President Donald Trump used to extend the pandemic pause on student-loan payments.
The Debt Collective
The memo DeVos received on her authority to cancel student debt broadly argued that the HEROES Act, along with the Higher Education Act (HEA), did not permit her to cancel student debt.
"Plain HEA language and context strongly suggest Congress never intended the HEROES Act as authority for mass cancellation, compromise, discharge, or forgiveness of student loan principal balances, and/or to materially modify repayment amounts or terms," the DeVos memo said.
The reasoning comes down to interpretations of the text. DeVos' lawyers wrote that the authority to modify or waive any form of debt is only permitted in certain circumstances, like a national emergency, but "the Department has never relied on the HEROES Act or any other statutory, regulatory, or interpretative authority for the blanket or mass cancellation."
Others would disagree. Attorneys and legal experts at the Legal Services Center of Harvard Law School wrote to Massachusetts Sen. Elizabeth Warren last year that while the power to cancel student debt "rests in the first instance with Congress," the Education Secretary "has the authority to modify a loan to zero" under the HEA.
"We don't even need this memo to know what we know, which is that Biden has the authority to cancel student debt," Brewington said.
Failing to release the memo is a 'political decision'
Americans don't know why Biden won't tell them what will happen to their student debt. Brewington thinks holding back the information is a "political decision."
"This is in line with how this administration has been moving politically along with student-debt cancellation, which is dragging their feet in ways that do seem intentional," Brewington said.
He added that Biden might be waiting for a politically advantageous time to cancel student debt, like right before the midterm elections, but there's still a lot of frustration that the memo has existed and the administration has "pretended that it hasn't existed in its entirety."
Meanwhile, the problem continues to grow. A number of borrowers previously told Insider they will not be able to afford restarting payments in February after they will have been on pause for nearly two years, with some convinced their debt will only go away when they die.
A group of Democrats attempted to speed up the process last month by giving the department two weeks to release the memo. But the October 22 deadline came and went with no response from the department, frustrating lawmakers and borrowers alike.
"Millions of borrowers across the country are desperately asking for student debt relief," Minnesota Rep. Ilhan Omar told Insider. "We know the President can do it with the stroke of a pen."
And with student-loan payments expected to resume in under 100 days, Omar said that borrowers need an answer.
"Release the memo," she said. "Cancel student debt."
Do you have a story to share about student debt? Reach out to Ayelet Sheffey at [email protected].