The Supreme Court case, Biden v. Nebraska, that will decide the fate of President Joe Biden’s student debt cancellation plan rests on a claim that states will be financially harmed if it goes into effect.
But data shows that the organization at the center of the battle, the Missouri Higher Education Loan Authority (MOHELA), would see its bottom line improve after debt cancellation. This is according to a new analysis by the Roosevelt Institute, a left-leaning think tank, and The Debt Collective, a union of debtors.
MOHELA is one of several companies the federal government pays to handle billing and other services on federal student loans.
Activists and students protest in front of the Supreme Court during a rally for student debt cancellation in Washington, DC, on February 28, 2023. Andrew Caballero-Reynolds/AFP via Getty Images
Delivering on a campaign promise, Biden had announced his plan to wipe away $10,000 in federal student loan debt for millions of Americans. There would be an additional $10,000 for those who received federal Pell Grants to attend college. These are awarded only to undergraduate students who display exceptional financial need and have not earned a bachelor’s, graduate, or professional degree.
Republicans quickly denounced the plan, arguing Biden did not have the legal authority to broadly cancel student debt. The Biden administration argued that it does under the HEROES Act. This legislation allows the secretary of education to waive or modify the terms of federal student loans in connection with a national emergency.
Six Republican-led states—Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina—sued to block the plan, arguing that they would be financially harmed.
Justin Haskins is the director of the Socialism Research Center at The Heartland Institute and a New York Times bestselling author. He wrote for Newsweek in December:
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