Opinion Biden Could make student loans dischargeable in bankruptcy without Congress

[Lord Coke]

Okay so here is my thought of the day. The law requires that you show undue hardship in order to discharge a student loan in bankruptcy. That is a much much higher burden than normal debt. And that term is in the law. However, Biden i.e. the President gets to set the definition of undue hardship via something called executive rule making. To get rid of the term undue hardship would require and act of Congress. But to reinterpret the phrase to be a really low standard like I can't start a family or whatever as the standard just requires Biden to sign a document.

A real world example of this is the bump stock rule. Trump made a rule that reinterpreted the federal law that bans machine guns to include bump stocks even though the ATF had previously said bump stocks are not machine guns. That Rule has been upheld in numerous courts all throughout the country.

I know his lawyer have told him he can do this. There is no way that this hasn't been presented as an idea. And that would be a far far better idea than this 10k cancellation idea.

It would be tailored because only the people that really need to get rid of student loans would go through the bankruptcy process but on the other hand people with large amounts of debt would receive more relief than the 10k they are going to receive in this across the board plan. More importantly it would be permanent fix. This 10k plan at best kicks the can down the road for a few years and does nothing for graduate school program grads that hold huge debt.

I am not the first person to say bankruptcy should be an option and that is a pretty obvious idea. But everyone suggests getting Congress to remove the undue hardship language and everyone knows Congress is not going to do that.

I don't see anyone that has suggested Biden doing this through the administrative rulemaking process. And if we assume I am right (and this is something that I know about through other contexts) and it would get upheld in the court system., why has this not been brought up as an idea? I think this is to obvious and practical of idea. I think its possible Biden's lawyers have brought it up internally and this idea has been intentionally not put out as a option. This is likely because this proposal would cause systemic change whereas cancelling 10k does not change the system but it does make Biden look good to his base which are going to be disproportionately impacted by this 10k student loan cancellation.

Thoughts?

 

[Limit Smasher]

No politician actually wants to cancel student loans. They just want to use at as an issue to trick people into voting for them. It works every election cycle.

 

[skysolo]

Biden helped write the bankruptcy bill which wouldn't allow discharge in the first place.

 

[terrapin]

Okay so here is my thought of the day. The law requires that you show undue hardship in order to discharge a student loan in bankruptcy. That is a much much higher burden than normal debt. And that term is in the law. However, Biden i.e. the President gets to set the definition of undue hardship via something called executive rule making. To get rid of the term undue hardship would require and act of Congress. But to reinterpret the phrase to be a really low standard like I can't start a family or whatever as the standard just requires Biden to sign a document.

A real world example of this is the bump stock rule. Trump made a rule that reinterpreted the federal law that bans machine guns to include bump stocks even though the ATF had previously said bump stocks are not machine guns. That Rule has been upheld in numerous courts all throughout the country.

I know his lawyer have told him he can do this. There is no way that this hasn't been presented as an idea. And that would be a far far better idea than this 10k cancellation idea.

It would be tailored because only the people that really need to get rid of student loans would go through the bankruptcy process but on the other hand people with large amounts of debt would receive more relief than the 10k they are going to receive in this across the board plan. More importantly it would be permanent fix. This 10k plan at best kicks the can down the road for a few years and does nothing for graduate school program grads that hold huge debt.

I am not the first person to say bankruptcy should be an option and that is a pretty obvious idea. But everyone suggests getting Congress to remove the undue hardship language and everyone knows Congress is not going to do that.

I don't see anyone that has suggested Biden doing this through the administrative rulemaking process. And if we assume I am right (and this is something that I know about through other contexts) and it would get upheld in the court system., why has this not been brought up as an idea? I think this is to obvious and practical of idea. I think its possible Biden's lawyers have brought it up internally and this idea has been intentionally not put out as a option. This is likely because this proposal would cause systemic change whereas cancelling 10k does not change the system but it does make Biden look good to his base which are going to be disproportionately impacted by this 10k student loan cancellation.

Thoughts?

this possibility has been spoken of in depth and extensively by progressives such as kalinski and crystal ball etc.... its one of the reasons many do not believe that biden actually wants to enact such a policy.

i am not sure i support the bill so it doesn't bother me much but fact is if biden really wanted it done it could/would be.

a quick youtube search turned up so many results from secular talk and breaking points that i dont know which one to post. nearly all of them will mention the solution of executive order and ask why it has not been done on a number of issues supposedly close to democrats hearts.

 

[Lord Coke]

this possibility has been spoken of in depth and extensively by progressives such as kalinski and crystal ball etc.... its one of the reasons many do not believe that biden actually wants to enact such a policy.

i am not sure i support the bill so it doesn't bother me much but fact is if biden really wanted it done it could/would be.

Biden helped write the bankruptcy bill which wouldn't allow discharge in the first place.

The distinction I am making is Biden could do this through the administrative rule making process which would bypass Congress. He literally just did this to change the definition of a firearm lower receiver this year. And basically the law means something completely different without Congressional approval.

 

[terrapin]

The distinction I am making is Biden could do this through the administrative rule making process which would bypass Congress. He literally just did this to define the definition of a firearm lower receiver this year. And basically the law means something completely different without Congressional approval.

i think you did not mean to quote me. my posts was about how the progressive wing of the country has covered this issue and brought it up dozens of times with full segments devoted to it ever since the issue has been mentioned by biden. its a pretty hot topic in progressive circles on the issue of student loan forgiveness and a number of other issues biden could solve via executive order.

secular talk and breaking points have covered it dozens of times between them.

 

[HockeyBjj]

The law requires that you show undue hardship in order to discharge a student loan in bankruptcy. That is a much much higher burden than normal debt.

All the talk about student loan forgiveness, and the solution really is simpler

Stop making student loans debt a special kind of debt. Have it be normal debt that can be bankruptible like any other debt. Helps those who are way in over their head, it doesn't help the upper middle class lawyers and doctors making good money but have 100K in student loan debt.

 

[M3t4tr0n]

Just make college free

 

[Snowblindlove]

Biden delivered!! He can do it and is doing it!!

 

[San Marino]

I'm still trying to wrap my head around 2.5 more years of Biden. How much worse will things get?
I don't think the guy will make it to 2024.

 

[Scheme]

Allowing student loans to be dischargeable and not having government guaranteed student loans is the best way to reduce tuition costs.

 

[Day Drinking]

Okay so here is my thought of the day. The law requires that you show undue hardship in order to discharge a student loan in bankruptcy. That is a much much higher burden than normal debt. And that term is in the law. However, Biden i.e. the President gets to set the definition of undue hardship via something called executive rule making. To get rid of the term undue hardship would require and act of Congress. But to reinterpret the phrase to be a really low standard like I can't start a family or whatever as the standard just requires Biden to sign a document.

A real world example of this is the bump stock rule. Trump made a rule that reinterpreted the federal law that bans machine guns to include bump stocks even though the ATF had previously said bump stocks are not machine guns. That Rule has been upheld in numerous courts all throughout the country.

I know his lawyer have told him he can do this. There is no way that this hasn't been presented as an idea. And that would be a far far better idea than this 10k cancellation idea.

It would be tailored because only the people that really need to get rid of student loans would go through the bankruptcy process but on the other hand people with large amounts of debt would receive more relief than the 10k they are going to receive in this across the board plan. More importantly it would be permanent fix. This 10k plan at best kicks the can down the road for a few years and does nothing for graduate school program grads that hold huge debt.

I am not the first person to say bankruptcy should be an option and that is a pretty obvious idea. But everyone suggests getting Congress to remove the undue hardship language and everyone knows Congress is not going to do that.

I don't see anyone that has suggested Biden doing this through the administrative rulemaking process. And if we assume I am right (and this is something that I know about through other contexts) and it would get upheld in the court system., why has this not been brought up as an idea? I think this is to obvious and practical of idea. I think its possible Biden's lawyers have brought it up internally and this idea has been intentionally not put out as a option. This is likely because this proposal would cause systemic change whereas cancelling 10k does not change the system but it does make Biden look good to his base which are going to be disproportionately impacted by this 10k student loan cancellation.

Thoughts?

I like it alot, because it would basically get rid of student loans entirely. The vast majority of graduates don't have assets to sell off, and ruining theor credit for 5 years doesn't matter.

 

[hansolo]

Just make college free

 

[Lord Coke]

All the talk about student loan forgiveness, and the solution really is simpler

Stop making student loans debt a special kind of debt. Have it be normal debt that can be bankruptible like any other debt. Helps those who are way in over their head, it doesn't help the upper middle class lawyers and doctors making good money but have 100K in student loan debt.

That's the whole point of my post. This is the way Biden could do it if he wanted to without congressional approval.

 

[M3t4tr0n]

Yup, I said it. Free.

 

[ShadowRun]

 

[cooks1]

All the talk about student loan forgiveness, and the solution really is simpler

Stop making student loans debt a special kind of debt. Have it be normal debt that can be bankruptible like any other debt. Helps those who are way in over their head, it doesn't help the upper middle class lawyers and doctors making good money but have 100K in student loan debt.

Agreed. But this is not even the main way it helps. The main way it helps is that it forces those making the loans to properly assess risk and bear the consequences of making a poor assessment. Which will result in much fewer student loans. Which will lower demand for universities and therefore the price, as well as increase demand for much needed trades. Which, of course, was how it was before our government stuck their thumb on the scale. Ah the law of unintended consequences.

 

[SandisLL]

No politician actually wants to cancel student loans. They just want to use at as an issue to trick people into voting for them. It works every election cycle.

Nope.
If student loans will be zeroed in personal bancrupt process.

Maybe then banks will start to judge how credible and usable in real life labour market is degree and institution offering degree....

Otherwise we even have companies offering huge loans to housewifes with promise to turn them into a programmer in 3 -4-5 months bootcamp or telling that with 3-4 years degree in psychology maybe is enough to get job in field easily etc....

 

[CantCucktheTuck]

The left sure does love themselves an authoritarian.

 

[nostradumbass]

All the talk about student loan forgiveness, and the solution really is simpler

Stop making student loans debt a special kind of debt. Have it be normal debt that can be bankruptible like any other debt. Helps those who are way in over their head, it doesn't help the upper middle class lawyers and doctors making good money but have 100K in student loan debt.

Every other debt has collateral. The reason you can't declare bankruptcy to get out of it is because you can't repo someone's degree. Would be like taking a mortgage on an expensive house, then declaring bankruptcy and still getting to keep the house without paying for it.