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- Education Sec. Miguel Cardona pushed back on opponents who say Biden's debt relief is unfair to those with private loans.
- He said the department "can't control other loans," responding to those with private debt.
- The Supreme Court heard oral arguments to the federal relief plan on Tuesday.
President Joe Biden's federal student-loan forgiveness is being hotly debated — but those holding private debt are largely left out of the conversation.
On Tuesday, the Supreme Court heard oral arguments for the two cases that challenged Biden's plan to cancel up to $20,000 in student debt for federal borrowers making under $125,000 a year. One of the cases was brought by six-Republican led states who argued the relief would hurt their tax revenues. The other was brought on behalf to two student-loan borrowers: one who did not receive a Pell Grant and did not qualify for the full $20,000 amount of relief, and another whose loans were commercially-held, not federal, and therefor did not meet the eligibility requirements for the plan.
Education Sec. Miguel Cardona appeared on CNN prior to the arguments on Tuesday. He was asked what he would say to those who do not qualify for the federal relief, like borrowers with private loans.
"We can control our loans. We can't control other loans," Cardona said. "I think it's very hypocritical for some who are making an argument that we shouldn't do this because some of them have received debt relief themselves," referring to the pandemic Paycheck Protection Program.
"Please, that's hypocrisy," he continued. "So it is the right thing to do. 40 million Americans are waiting, and we have the legal authority to do it."
Shortly after Biden's debt relief was announced, the Education Department changed the eligibility requirements due to the rising legal challenges. While borrowers in the Federal Family Education Loan (FFEL) program were originally able to consolidate their debt in to the federal loan program and qualify for relief, guidance in September stated that those borrowers were no longer able to consolidate and qualify for Biden's plan.
One borrower in the FFEL program previously told Insider that he wasn't immediately aware of the reversal, and when he found it, it felt like the relief "got yanked away."
"That could've been $10,000 I didn't have to pay, and now that's gone," he said.
Still, over past years the Consumer Financial Protection Bureau has taken steps to protect borrowers from surging private student loads that come with high interest rates. In 2014, for example, it sued for-profit chain ITT Tech, accusing the school of pressuring students into taking on private loans they would likely default on, and a year later, the Securities and Exchange Commission took the chain to court for deceiving investors about high rates of defaults on the loans.
The main focus of the Education Department right now is protecting its federal debt relief plan, and the Supreme Court is expected to issue a final decision by June.