Oklahoma and Missouri can stop Biden’s student loan bailout | Open

Can the president spend between $500 million and $1 trillion without approval from Congress, the branch of government that holds the power of the stock market under the Constitution?

My Constitution says no. But if Biden’s student loan bailout is illegal, who can stop him? And will they? These are the key questions and it may fall to two uniquely positioned states: Missouri and Oklahoma.

Under the Supreme Court’s recently codified major issues doctrine, a program of this magnitude requires a crystal clear directive from Congress, which is why most legal analysts doubt the student loan discharge order of the President Biden based on a twisted post-9/11 reading. The Heroes Act of 2001 combined with an allegedly ongoing COVID emergency can withstand legal scrutiny.

Biden’s bet hinges on the case not being litigated, and that in turn hinges on whether any party willing to challenge the order has standing to sue. The arguments in favor of the state, the taxpayer and the legislator are tenuous. The case for loan managers, on the other hand, is strong.

A comprehensive analysis by Colin Mark in the Journal of the National Association of Administrative Law Judiciary concluded, “In sum, student loan servicers could take legal action to stop the Department of Education from forgiving student loans. Repairers could demonstrate harm in fact, fairly traceable to the Department’s cancellation of student loans, and reparable by equitable relief under APA Section 702.

Publicly traded loan manager Nelnet is clear in its latest filing with the SEC that a program like Biden’s would significantly harm the company: “There is a risk of legislative and executive action…If the government Federal and Department initiate additional loan forgiveness or forgiveness, other repayment options or plans, consolidation loan programs, or further extend borrower payment suspensions under the CARES Act, such initiatives could further increase prepayments and reduce interest income and could also reduce service charges.

Curiously, the company has made no public statement about Biden’s announcement indicating that it may sue. In fact, the administration can count on the fact that the repairers will not want to risk losing future contracts by disputing the order. This may be why the Ministry of Education has set all current service contracts to expire at the end of 2023, making repairers more inclined to absorb the loss of business due to the massive layoff without complaint to stay in the good graces of future Biden administration contracts.

Two Fixers, however, are state agencies from conservative states and should be prepared to stand up for taxpayers and prevent an unprecedented and illegal transfer of wealth from people who played by the rules and paid their own way — or who didn’t. didn’t go to college. at all – to generally higher-income university graduates.

The State of Missouri Higher Education Loan Authority (MOHELA) and Oklahoma Student Loan Authority (OSLA) are state institutions governed by boards appointed by their governors and subject to removal for cause. This puts Governors Mike Parson of Missouri and Kevin Stitt of Oklahoma in the unique position of being able to fight a successful legal fight to stop Biden’s student loan bailout.

These governors and the lending organizations they oversee must sue.

At stake is not just the future of higher education – if Biden’s bailout holds, it will skyrocket tuition even further in anticipation of a new tradition of dumping costs onto taxpayers – but the fundamental principle that the president cannot usurp the power of Congress over the bag.

Phil Kerpen is the president of American Commitment and the author of “Democracy Denied”. Kerpen can be contacted at [email protected]

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