Biden’s Student Debt Scheme Is a Political Bankshot

By Noah Rothman

Monday, October 3, 2022

 

No one who has followed Democratic rhetoric around the president’s constitutionally dubious executive order transferring the student debt burden assumed by millions of borrowers onto taxpayers’ shoulders could mistake it for sound, neutral policy. This is and always was a persuasion play with the midterm elections in mind.

 

“This is really good politics because it is in fact promises being kept to these young voters who were a pillar of his coalition,” said Democratic pollster Cornell Belcher. College Democrats of America President Jalen Miller agreed. “This is a great step forward to get the youth vote invigorated for Biden in the midterms and 2024,” he observed, adding that it’s only a prelude to total “student debt cancelation.” Progressives, like Hollywood writer-director Adam McKay, finally saw some signs of life in their party’s superannuated leader. “That is exactly what people have been begging for for years,” he insisted. “I think it changed the whole trajectory of the midterms.”

 

It did not. A summer slump in the polls notwithstanding, Republicans remain on roughly the same trajectory toward a successful midterm cycle they’ve followed since the autumn of 2021. And as legal challenges mount over the president’s lawless disbursement of somewhere between $400 billion and $1 trillion from the Treasury, the political arguments in favor of this initiative are evolving.

 

“I know I’m being banged up by the Republicans, but bring it on,” Biden told the audience at a Congressional Black Caucus Foundation event over the weekend. It is not, however, “Republicans” who will be responsible for any court-ordered injunction that might halt the president’s debt-transference scheme. Some Republican-led states have brought a suit against the government, but so, too, have private groups like the Pacific Legal Foundation. The Biden administration has been haphazardly scaling back the parameters of their debt-transference scheme—curtailing the number of privately held federal loans eligible for relief, and emphasizing a newly discovered “opt-out” option to avoid giving any plaintiff space to claim harm and, therefore, standing before the court. But all this concedes that the Democrats’ opponent here isn’t the GOP but the independent judiciary and the Constitution. Neither of which will be on the ballot on November 8.

 

Democrats appear to have convinced themselves that Biden’s debt scheme is a win-win situation. If it holds up, Democrats will bask in the admiration of enthusiastic young adults. If Biden’s initiative doesn’t withstand scrutiny in the courts, Democrats will benefit passively from the anger this demographic will unleash on the GOP. Either way, the party in power is betting that inchoate sentimentality will save them.

 

Will voters head to the polls to vote against Republican members in Congress to punish the federal judiciary, the members of which are appointed by the president? Maybe. But the White House isn’t betting that student debt holders will head to the polls with the Senate Judiciary Committee foremost on their minds. They’re betting that ire will consume them, and they’ll take their wrath out on anyone whose name appears in the Republican column. The Republican Party, too, is banking on the anger of voters, but the party out of power will have a much easier time making its case.

 

Republicans contend that this reckless injection of even more money into an economy typified by rising consumer costs will contribute to inflation. They don’t have to make the case; Democrats are making it for them. “Pouring roughly half trillion dollars of gasoline on the inflationary fire that is already burning is reckless,” wrote the chair of Barack Obama’s council of economic advisers, Jason Furman.

 

Republicans insist that Biden simply does not have the constitutional authority to do what he’s done. Here, too, Democrats have made the case. “If the issue is litigated, the more persuasive analyses tend to support the conclusion that the Executive Branch likely does not have the unilateral authority to engage in mass student debt cancellation,” read a memo authored by Charlie Rose, the general counsel for the Department of Education in Obama’s first term. For good measure, the White House’s attempt to locate the legal authority for student loan forgiveness in a post-9/11 law designed to support those who served in the armed forces adds insult to constitutional injury.

 

Finally, Republicans argue that the president’s maneuver provides a taxpayer-funded handout to Americans who are least in need of it. Republican ad-makers have bedecked their spots with working-class Americans seething over the administration’s subsidization of white-collar knowledge workers and artists. As the party’s nominee for U.S. Senate in Ohio, Rep. Tim Ryan, observed, it “sends the wrong message to the millions of Ohioans without a degree working just as hard to make ends meet.”

 

In the end, if Biden’s power-grab does not survive in the courts, the GOP’s arguments against it will still stand. The debt transference scheme will still be lawless, inflationary, and a brazen giveaway to a core Democratic constituency at the expense of the taxpaying public. We will have been spared its effects only by the imbecility of the program’s design. Democratic voters who back this initiative will still be struggling to regain their footing having had the rug pulled out from under them when the Biden administration demands that they organize a rear-guard action. The party in power will demand vengeance—not because it will salvage their preferred policy (it won’t), but because it would jam a thumb in some deserving eyes.

 

Even if Biden’s debt scheme isn’t struck down, that would only invalidate the GOP’s claim that the maneuver was unconstitutional. It will still be an act of “stolen valor.” It will still be inflationary at a time of soaring inflation. It will still be a handout to the wealthy and those with the highest earning potential. Democrats will insist that the courts could find no one who was “harmed” by this initiative, but Republican ad-makers most certainly will.

 

Joe Biden set out to make Democrats’ lives easier as they navigate a difficult political environment. His debt transference scheme seems likely to produce the opposite of its intended effect.