John Hollihan

27 October 2023

During his campaign for the 2020 United States presidential election, President Biden promised to aid in the relief of federal student loan debt. The Biden administration began to fulfill this promise in August 2022. They announced that the Department of Education (ED) would relieve $10,000 for individuals with a four-year degree and an income of less than $150,000 and for married couples with an income of less than $250,000. Under executive action, Biden announced that through the Higher Education Relief Opportunities For Students (HEROES) Act, the Secretary of Education would begin the process of forgiving over $430 billion in student loan debt.

On September 29, 2022, Nebraska, Missouri, Arkansas, Iowa, Kansas, and South Carolina filed a lawsuit in the Eastern Missouri U.S. District Court challenging the legality of the forgiveness program. The case made its way to the Supreme Court and oral arguments were delivered on February 28, 2023. On June 30, the Court delivered a 6-3 opinion striking down the forgiveness program, stating that the Secretary of Education’s modifications were neither “moderate” nor “minor” per the HEROES Act (1). As of September 23, 2023, the Federal Student Aid office’s website displays a message stating that the Supreme Court has “issued a decision blocking us from moving forward with our one-time student debt relief plan” (2). Additionally, the pauses on repayment caused by the COVID-19 pandemic have ended. Indebted students are now in a confusing limbo state of resuming repayments, while the spectacle of debt forgiveness lingers over them.

The Biden v. Nebraska decision is the most recent example of how the state has demonstrated its consistent ineffectiveness when addressing issues that affect marginalized people. Within the last year, the U.S. has seen multiple instances of the government failing to protect vulnerable populations. Some of these instances include the decision in Dobbs v. Jackson Women’s Health Organization (2022), state legislation banning drag shows, and legislative attacks on transgender and gender non-conforming people. Much of U.S. law is set by court precedent, and these decisions call into question the validity of other due process court cases (e.g., Loving v. Virginia (1967), Obergefell v. Hodges (2015), etc.). Understanding class as one of the primary antagonisms of human society, we can analyze the underpinnings of these decisions and how to move forward.

Socialist analyses and criticisms of democracy under capitalism provide a useful framework for analyzing the current state and practice of legislation and litigation in the United States. To understand these criticisms, it is necessary to acknowledge the fundamentals of Karl Marx’s understanding of the capitalist mode of production, the organization of classes, and the state.

Under capitalism, the means of production are privately owned by the bourgeoisie—the capitalist class. The means of production refer to the processes and logistics of producing and distributing goods and services; some examples include land, labor, and capital. With the understanding of the capitalist mode of production, the role of the state and liberal democracy under capitalism can be understood. Both Marx and Vladimir Lenin critique the structures of democracy under capitalism. Marx understands the state as the political manifestation of the ruling class. He argues that the primary function of the state under capitalism is “for managing the affairs of the whole bourgeoisie” (3). Lenin further argues that under capitalism, democracy is limited by capitalist exploitation and remains a democracy “only for the rich” (4). More generally, socialist criticisms of capitalist democracy state that it is inherently undemocratic because the “means of production are concentrated in the hands of the minority class” (6), i.e., the capitalist class. 

To Marx, parliamentary elections are simply a manipulative tool that allow the proletariat to decide which bourgeois party exploits and oppresses them. Lenin contextualizes this further to U.S. presidential elections, stating that even by the early 20th century, the distinctions between the Democratic and Republican parties had begun to diminish. Specifically, he describes the actual elections as “meaningless duels between the two bourgeois parties” (7). Furthermore, these politicians represent the capitalist class because of the requirements to achieve a position of power such as the president, a member of the House, a Senator, a Supreme Court justice, etc. U.S. politicians are typically not working class and because of that, their interests do not align with the class interests of the working class, e.g., indebted college graduates. For the average U.S. worker, the amount of money needed to simply have a chance at participating in the political sphere is unattainable. These people must control enough capital to attend a university, begin their professional careers, and maintain an election campaign.

The Marxist understanding of the capitalist state and liberal democracy provides explanatory power for the parliamentarian process under capitalism. To consider the material conditions of oppressed peoples is to consider how the capitalist state seeks to maintain its power. In the scenario of Biden v. Nebraska, the language and legal precedence of the Supreme Court’s decision reveal how the Marxist understanding of capitalist democracy is seen in U.S. politics.

In theory, the Supreme Court is supposed to be an objective arbiter. The Court is the final decision maker on how the constitution and other legislation ought to be interpreted. Yet many people in the U.S. agree that it has become another battleground between the Democratic and Republican parties—the two bourgeois parties—and a question of who can nominate as many justices as possible. This is especially troubling because Americans do not directly participate in the nomination nor confirmation of justices; they do so by proxy of the senators they elected.

The majority opinion in Biden v. Nebraska was written by Justice Roberts, joined by Justices Thomas, Alito, Gorsuch, Kavanaugh, and Barrett. The majority used the major questions doctrine, the idea that if an executive agency creates or employs a program of “major national significance,” the action(s) must be supported by “congressional authorization” (8). Furthermore, the Court held that Missouri had standing to challenge the forgiveness program because it would harm the Missouri Higher Education Loan Authority (MOHELA). MOHELA is a non-profit corporation contracted by the Office of Federal Student Aid to manage student loans in Missouri. In their decision, the majority stated that the program “would reduce MOHELA’s revenue by approximately $44 million per year” (9). Much of MOHELA’s revenue comes from the service fees and accrued interest on student loans and a cancellation would end that source of income for the company.

The dissenting opinion, written by Justice Kagan and joined by Justices Sotomayor and Jackson, primarily argues that the Court had no right to decide the case. The dissenting write, “the plaintiffs in this case are six States that have no personal stake” (10). They argue that the Court violated the constitution by including the role of parties not actively involved in the case. Furthermore, since the majority opinion focused on the revenue loss of MOHELA, the dissent argues that this institution should have instead participated in the lawsuit. Upon first glance, one can see that the Court’s opinion is harmful to many students who depended on the forgiveness of some loans. However, there are deeper meanings to the logic and justifications of both the majority opinion and the dissent.

Firstly, the majority opinion notes that “the question here is not whether something should be done; it is who has the authority to do it” (11). The first clause of this statement is interesting because it demonstrates a level of separation from the six justices and their constituents. Much of the discourse regarding loan forgiveness focuses on the effects of debt, bankruptcy, and forgiveness on students. This clause from the justices ignores that discourse for court and legal obligations. Similarly, the dissenting justices focused on court procedures and who ought to have participated in the lawsuit. However, the people who ultimately face the consequences of this decision are college students with federal loans. The opinions in both the majority opinion and the dissent seem meaningless when compared to the material conditions that indebted students can and will face. Both opinions seem, to use the language of Lenin, to be a meaningless duel about the specifics of legislation and court precedent between the two bourgeois parties, as neither opinion directly discusses the effects the decision has on students. Now, one may object to this conclusion and detest the word meaningless. However, I suggest they consider a) the material realities and struggles of indebted college students and b) for whom U.S. democracy functions. None of the Supreme Court justices need be concerned about poverty or bankruptcy because of their positions of power. The justices’ focus on jurisprudence and procedure raises questions about the utility of the courts’ ability to make or guarantee any meaningful systemic reform. Capitalist democracy functions as a democracy for the rich; capitalists’ assets, investments, and political power are maintained while the working class suffers.

Secondly, the majority’s opinion regarding the effects on MOHELA explicitly reference the desire of the capitalist class to protect capital. Beyond judicial review, one of the primary reasons for the Court’s decision focused on the revenue of a corporation. The protection of capital is a fundamental aspect to the bourgeoisie’s solidification of power. One of the primary arguments against forgiveness is that the plans are “depriving it [MOHELA] of the ongoing interest payments that those loans generate” (12). These loan agencies would lose capital from the interest payments if they were canceled. There are five agencies that the ED works with to service loans: Edfinancial, MOHELA, Aidvantage, Nelnet, and ECSI. In addition to servicing loans, they also attempt to help students with repayment options, but have continuously misled students into further payments, even after the promised cancellation after twenty-five years of repayment (13). The cluster of bureaucracy, confusion, and servicing from both the loan agencies and the ED are centered around one goal: protecting capital. Loan servicers prevented college graduates from access to IDR cancellation because they obtain revenue from the interest accruing on payments. And since the interest typically accrued at a faster rate than the minimum loan payments, it was an almost endless source of income.

Finally, there is a quote included in the Court’s opinion that unintentionally reveals how capitalist democracy can be reduced to meaningless duels. The opinion quotes then-Speaker of the House, Nancy Pelosi. She stated that, 

 “People think that the President of the United States has the power for debt forgiveness. He does not. He can postpone. He can delay. But he does not have that power. That has to be an act of Congress.” Press Conference, Office of the Speaker of the House (July 28, 2021) (14).

The inclusion of this quote in the Court’s opinion is a rhetorical strategy. The majority opinion was written by the conservative justices, and the inclusion of a quote from the de facto leader of the Democratic Party is an intentional move to support their decision. As mentioned earlier, Lenin argued that there are almost no differences between the Republican and Democratic parties. To develop this further, many Americans understand that both parties pettily attack one another, and this rhetorical move is an effect of this phenomenon. The decision to include Pelosi’s comment is an attempt to demonstrate that even the opponents of the conservative justices agree with them. Rather than focus on the needs of indebted graduates, the decision shifted to pointing fingers and finding petty ways to justify their decision. College graduates owe billions of dollars in loans, risking the future of their lives and quality thereof. Meanwhile, politicians, the people who determine the outcome of these graduates’ lives, are engaging in meaningless and petty arguments while their constituents suffer.

If you are an average student or worker in the U.S., you may ask why all this information is relevant; why is this intensive look into Marxist criticism of our liberal democracy necessary or useful for analyzing contemporary politics? We are at the apex of late-stage capitalism. Systemic issues like global warming, poverty and homelessness, mass incarceration, and imperialism call for an urgency in finding solutions. Every year, U.S. voters go to the polls, and in the most recent elections (2018, 2020, and 2022) there have been small victories for progressive candidates. Yet, time and time again, we see that it is not enough. Protections for reproductive rights, protections for LGBTQ+ youth, police brutality, and mass poverty and homelessness are either threatened or have become increasingly prominent issues. Democracy under capitalism has repeatedly demonstrated that it is not for the People, it is for the protection of capital and the bourgeois class. My intention for this text is to provide the language and analytical tools for understanding the ineffectiveness and destruction of our “democracy.” For the future, for tangible solutions, we must look at alternatives to the systems of power that work to maintain capitalism.

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References

(1) Joseph R. Biden, President of the United States, et al. v. Nebraska, et al. 2023. 22-506 (Supreme Court of the United States, June 30).

(2) Office of Federal Student Aid, “The Biden-Harris Administration’s Student Debt Relief Plan Explained.” United States Department of Education, n.d. Accessed September 22, 2023.

(3) Marx, Karl, “Manifesto of the Communist Party.” Marxists Internet Archive. 1987. Accessed September 24, 2023, 15. https://www.marxists.org/archive/marx/works/download/pdf/Manifesto.pdf

(4) Lenin, Vladimir Ilyich, “The State and Revolution.” Marxists Internet Archive. 1993. Accessed September 23, 2023. https://www.marxists.org/ebooks/lenin/state-and-revolution.pdf

(5) Ibid., 60. 

(6) Segrillo, Angelo. 2012. “Liberalism, Marxism, and the Democratic Theory Revisited: Proposal of a Joint Index of Political and Economic Democracy.” Brazilian Political Science Review 8-27, 15.

(7) Lenin, Vladimir Ilyich. 2004. “The Results and Significance of U.S. Presidential Elections,” Marxists Internet Archive. Accessed September 24, 2023. https://www.marxists.org/archive/lenin/works/1912/nov/09.htm

(8) Congressional Research Service. 2022. “The Major Questions Doctrine.” Congressional Research Service. November 2. Accessed September 24, 2023. https://crsreports.congress.gov/product/pdf/IF/IF12077.

(9) Showalter, J. Michael, Alex Garel-Frantzen, and Samuel A. Rasche. 2023. “SCOTUS Update: Administrative Law Takeaways from Biden v. Nebraska.” ArentFox Schiff. July 7. Accessed September 24, 2023. https://www.afslaw.com/perspectives/environmental-law-advisor/scotus-update-administrative-law-takeaways-biden-v-nebraska.

(10) Biden, et al. v. Nebraska, et al., 2.

(11) Ibid., 19. 

(12) Turner, Cory. 2022. “A look inside the legal battle to stop Biden’s student loan relief.” National Public Radio.September 30. Accessed September 24, 2023. https://www.npr.org/2022/09/30/1126083883/bidens-plan-to-cancel-some-student-debt-turns-into-a-legal-fight.

(13) Student Borrower Protection Center. 2021. “Education Department’s Decades-Old Debt Trap: How the Mismanagement of Income-Driven Repayment Locked Millions in Debt.” National Consumer Law Center. March. Accessed September 24, 2023, 4. https://www.nclc.org/wp-content/uploads/2022/08/IB_IDR.pdf

(14) Biden, et al. v. Nebraska, et al., 23.