Local attorneys and advocates for student loan forgiveness listened anxiously Tuesday as the US Supreme Court scrutinized President Biden’s plan to forgive up to $20,000 in college debt for millions of Americans, with the conservative majority questioning the administration’s authority to scuttle student loans en masse as a result of the coronavirus pandemic.
The stakes are high for the roughly 813,000 Massachusetts residents eligible for loan forgiveness under Biden’s plan, including many young people who are delaying starting a family, buying a home, or entering graduate school because of debt, according to Claudio Martinez, executive director of Zero Debt Massachusetts, a grassroots group that advocates for solutions to the student debt crisis.
“It’s time to help student borrowers in need, their families, and their communities,” Martinez said. “This type of relief can bring a lot of economic benefits to the people that need them the most.”
Peter Daigle, a bankruptcy attorney for 25 years who has six offices across Eastern Massachusetts, said some of his clients took out loans so they could get degrees in fields of study that didn’t lead directly to jobs. Now, they are working in the service industry or other fields that don’t pay enough for them to pay down their debts, he said.
“The income that you have goes to pay for your food, clothing, shelter, automobile, transportation, things like that, and there’s no disposable income to service debt,” Daigle said. “The people that struggle the most are the underemployed . . . They’re saddled with $200,000 in debt and they’re making $40,000 a year.”
In the meantime, people hoping to discharge some or all of their student loan debt under Biden’s plan remain in “limbo” more than six months after it was announced, advocates said.
“We are concerned that this is taking very long,” said Bahar Akman Imboden, managing director of the Hildreth Institute, a Boston nonprofit that works to make higher education more accessible. “We are not going to hear an opinion issued for maybe another three months,” or longer.
When the opinion comes, it could be bad news for borrowers, attorneys said. In Tuesday arguments, conservative justices seemed skeptical the president has authority from Congress to provide more than $400 billion in student loan forgiveness.
Daigle agreed. “I don’t think that the president has the power to dissolve debt,” he said.
Other local lawyers said the court may not even consider whether Biden exceeded his authority because the justices could determine that the six Republican-led states and the individuals challenging the loan forgiveness plan lacked the legal right to sue.
“A lot of the attention was focused on the question of standing” and whether the states that brought the lawsuit actually will be harmed by the policy, said Abby Shafroth, a senior staff attorney in the Boston office of the National Consumer Law Center and director of the Student Loan Borrower Assistance Project.
Shafroth, who was in the Supreme Court chambers as the attorneys made their arguments, said Justice Ketanji Brown Jackson seemed particularly wary of the court getting involved in a matter of political controversy.
“She repeated a few times that she was very concerned that if the judiciary usurps the power of the political branches by wading into the student debt-cancellation process, that this is something that threatens the separation of powers,” Shafroth said.
Adam S. Minsky, a Boston attorney whose practice focuses on student loan law, said conservative Justice Amy Coney Barrett seemed to share the concerns of the court’s three liberal justices regarding the plaintiffs’ rights to bring the lawsuits.
“It’s possible that if one of the remaining justices joins them, the cases could be decided on the issues of standing alone, without having to reach the underlying merits,” Minsky said.
Minsky has clients with $10,000 or $20,000 of student loan debt who would see it wiped out if Biden’s plan survives the court’s scrutiny, and others who owe $100,000 or more and will still be on the hook, he said.
Advocates said the country needs a more aggressive approach to student loan forgiveness that will help those at the upper end of that spectrum.
“This feels like a Band-aid right now, but a much necessary Band-aid,” said Peter Barros, executive director of La Vida Scholars, a college access program in Lynn for low-income and first-generation college students. “The reality is we should be talking about the real root of this problem, which is the skyrocketing cost of higher ed.”