The Growing Role of the Supreme Court in Shaping Policy: Implications for Student Loan Forgiveness and Beyond

The conversation around federal student loan debt has been buzzing for quite some time, but it wasn’t until the COVID-19 pandemic that the conversation took center stage in a way that felt within reach.

In March of 2020, most people remember the small sense of relief felt when they learned federal student loans were paused, especially during times of such uncertainty. We know that there are roughly 43 million borrowers with student loan debt, and forgiving even up to $20,000 could eliminate debt entirely for just under half of them. That’s potentially life changing.

But is that something the Biden Administration can do constitutionally? That’s the big question that came before the Supreme Court in February of this year. And the opinion could have impacts well beyond whether or not money gets put back in the pockets of borrowers.

The Biden Administration’s student loan forgiveness plan could mean the difference between having enough money in savings for emergencies versus going into credit card debt. Of the 43 million student loan borrowers, most are between the ages of 25 and 48 — Americans carrying debt into middle-age and further.

But something equally concerning is the moment of judicial activism we find ourselves in.

How the Supreme Court rules on this issue is indicative of something larger — not just the precedent for what constitutes a violation of separation of powers or executive overreach — but the growing legislative role the highest court in the land has taken by shaping policy from the bench.

While it might sound like the opposite of what we expect from impartial justices, the 6–3 conservative makeup of the Court, coupled with the polarization in today’s politics, makes the type of cases brought before the Court noticeably more hot button and controversial. This means justices, who are supposed to be insulated from the political sphere, exercising a much more political role as they actively shape policy.

We’ve seen this policy shaping occur more and more — in recent years; the disturbing reversal of Roe v. Wade, the decision to expand the rights of gun owners in New York State Rifle & Pistol Association Inc. v. Bruen, and the rushed decision to freeze a lower court’s injunction upholding the Voting Rights Act in Merrill v. Milligan.

The opinions in these rulings — or the policy being shaped from the bench — have an impact on our communities both implicitly and explicitly.

When it comes to debt relief, if the Supreme Court decides that the Biden Administration’s actions are unconstitutional, and an example of executive overreach, millions of people will be left struggling to make minimum payments. Which means they might not have the several hundred dollars they counted on last month, affecting their spending habits and altering the course of their lives.

When it comes to student loan forgiveness, there are actions our federal, state and local leaders can take to help borrowers find some relief. The Public Service Loan Forgiveness program is a current avenue, which forgives debt for borrowers who work full-time for at least ten years and have made 120 payments for a qualifying employer — typically in government or for a non-profit organization.

But it’s not enough to provide relief for the 43 million borrowers in debt.

Leaders should be looking at ways they can not only reduce the burden for current borrowers, but prevent future students from getting into this much debt in the first place.

States can evaluate or reevaluate how they tax federal student loans, if at all. If federal loans are counted as taxable income, there’s a larger burden to the borrower. State leaders can also look at various types of fee waivers offered, potentially expanding access. Or expand education efforts on types of aid available.

We have a role to play in making sure we’re electing individuals who will take things a step further, and try to put in place protections to counteract potentially harmful rulings coming from the Supreme Court.

The decisions that come from the highest court in the land have ramifications felt at every level of government, in every state, in every community — whether or not we’re paying attention.

So it’s crucial we know what is on the docket — and what our state and local elected officials are willing to do when policy is made from the bench.

This piece was written by Strategic Policy Director Ashleigh Padilla Goins and Campaign and Policy Coordinator Colin Scharff. Ashleigh and Colin support the Evinco Strategies Policy Department as well as general consulting for Evinco.

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