On 4 February 2021, two weeks after President Biden took office, Senate Majority Leader Chuck Schumer and Senator Elizabeth Warren, with House members including Ayanna Pressley, reintroduced a resolution calling on the president to use executive action to cancel up to $50,000 in federal student loan debt per borrower.
The argument
Supporters argued that student debt, then around $1.6 trillion, held back home ownership, saving and small-business formation, fell disproportionately on Black borrowers, and that the Higher Education Act gave the Education Secretary power to cancel federal loans. Opponents argued that blanket cancellation would be expensive, would benefit some higher-income graduates, would be unfair to people who had repaid or not gone to college, and that the president lacked legal authority without Congress.
The 2022 plan
President Biden did not adopt the $50,000 figure. On 24 August 2022 he announced a plan to cancel up to $10,000 per borrower, or up to $20,000 for those who had received Pell Grants, for people earning under $125,000 (or $250,000 for households). The administration relied on the HEROES Act of 2003, which allows the Education Secretary to waive or modify student loan rules in connection with a national emergency.
The Supreme Court
Several states and two individual borrowers challenged the plan. On 30 June 2023, in Biden v. Nebraska, the Supreme Court ruled 6–3 that the HEROES Act did not authorise cancellation on that scale. Chief Justice Roberts, writing for the majority, said the Secretary's power to "modify" did not extend to rewriting the programme. In a companion case brought by borrowers, the Court held that they lacked standing.
Afterwards
The administration then pursued narrower relief through existing programmes, such as Public Service Loan Forgiveness and income-driven repayment, and a new repayment plan called SAVE, which was itself blocked by lower courts. Congress changed repayment rules again in 2025. The broad question of who should decide on mass cancellation, the president or Congress, was answered by the Court: without clear authorisation, it is Congress.
Sources
General information about the law as it stood when this page was updated, not financial, tax or legal advice. Rules and limits change; check the official source or a qualified adviser before acting.