Nebraska AG's Backfiring Lawsuit

January, 2023

Lincoln —  Is pressure building on the Nebraska attorney general to drop or settle Nebraska v. Biden, which seeks to undo the Biden Administration's student loan cancellation plan?  For Nebraska borrowers, the debt relief could total as much as $2 billion and help an estimated 200,000 or more individuals.  

But it is not only potential beneficiaries who are questioning the wisdom of the lawsuit.  New developments show serious concerns from conservative law professors, fiscal watchdogs, and businesses.   

In an amicus brief filed with the Supreme Court, Notre Dame professor Samuel Bray and University of Chicago professor William Baude, both notable conservatives, are advising the Court to deny Nebraska and other plaintiffs standing to sue, so that the Court does not sit "in constant judgment of every major executive action — which is not its constitutional role."

Meanwhile, an analysis by three University of Virginia economists shows who is benefitting from the lawsuit, which is keeping the pandemic-related student loan repayment pause in effect until the lawsuit is resolved:  "Our analysis shows the across-the-board pause on federal student loan payments disproportionately benefits the most affluent borrowers. Continuing the payment pause without means-testing its benefits leads to ballooning costs for taxpayers."

On January 18, a Nebraska-based major student loan servicer announced layoffs of 560 employees.  According to Business Insider:

The company confirmed in a statement that 350 of those employees were hired in the past six months after Biden announced up to $20,000 in debt relief to help with what was expected to be high call volume as the relief was implemented and student-loan payments were turned back on. But the debt relief has been blocked.... [T]he lack of work for those additional employees led to this decision.

This is surely not the way the Nebraska attorney general and his five fellow plaintiffs expected the lawsuit to unfold.  They originally fixated on challenging the president's emergency powers to cancel debt, but in so doing they are creating a constitutional issue regarding legal standing, extending a regressive and wasteful fiscal policy and, in the process, hurting their own economies and businesses.  

Ironies abound.  Nebraska has shot itself in both feet, even before considering how the debt relief would aid middle and low-income families to assist a sluggish Nebraska economy.  

Moreover, this week the U.S. Government Accountability Office released a report condemning the U.S. Department of Education for halting investigations of college misrepresentations (mostly by for-profit schools) during the Trump administration (no surprise there).  This has created even more dubious student loan debt that will have to be cancelled under "borrower defense" or other statutes.  

There is a way to settle the lawsuit quickly.  The Biden administration does not have to use emergency powers to cancel debt.  There is already statutory authority authorizing it.  Agreement and action on that point should satisfy the plaintiffs, allow the U.S. Department of Education and its loan servicers to get back to work, save taxpayers from wasteful spending on regressive policies, and avoid a constitutional crisis over standing.  

We should thank those who have come forward, consumer advocates and conservatives alike, to point out the folly of this lawsuit, a half-baked scheme that originated in a dark-money den — Koch-funded American Commitment — with scant to no input from Nebraska citizens and taxpayers. 

We should also thank in advance any media sources that explain these issues to Nebraskans, few of whom know anything about the lawsuit's huge consequences that hang in the balance.  



Don't Close the Books Yet on Governor Ricketts

January, 2023

Lincoln — Before the books are closed on the performance of Pete Ricketts as Nebraska's governor, a few entries should be re-assessed and fact-checked.  

The governor left office riding unexpectedly high, making the most of an adulatory article about his handling of the Covid pandemic, published by Politico in April, 2022.  The article, based on Politico's own constructed index, concluded that Nebraska's Covid record was "surprisingly" best in the nation.  It gave much credit to a previously obscure "Center for Operational Excellence" established by Ricketts in the Nebraska Department of Administrative Services.  

I worked in Nebraska state government for several years, when it was less partisan, and continue to be in touch with many who keep close tabs on it.  Before the article appeared, Ricketts got low marks for management, as might be expected of someone who had no previous experience in government or the military.  The departments under his control ("code" departments) lurched from one crisis to another — foster care collapse, prison riots, contracting errors, stolen drug evidence, attempted grants to political contributors, a major environmental disaster, and significant accounting lapses.  Not the stuff of "operational excellence," by any definition.

The glaring discrepancy has two good explanations:  (1) Politico's index is poorly conceived; (2) Nebraska's Covid outcomes are in spite of the governor, not because of him. 

• Politico's index curiously weighs factors such as Nebraska's low unemployment rate, which is largely unrelated to its Covid policies.  A more credible Covid ranking, created by The Commonwealth Fund in June, 2022, ranks Nebraska a less surprising 14th, behind other midwestern states Minnesota and Illinois but ahead of Iowa, Missouri, Kansas, and South Dakota.

• Politico's article, to its credit, explores how Nebraska's ranking may be due to leadership from sources other than the governor, namely the University of Nebraska Medical Center and public health directors in Douglas and Lancaster counties.  These leaders often disagreed with Ricketts' decisions and pushed for tougher anti-Covid measures, saving lives.  They did not mince words or send mixed signals about the value of vaccinations, for example, as did the governor.  Rural areas, Ricketts' political base, have had the worst Covid outcomes in the state.  

As Ricketts left office, he also repeated his mantra that government should be "run like a business."  But his record suggests the slogan, as he interprets it, means something other than close attention to departmental management.  Ricketts seldom deigned to get directly involved in code departments' crises, but distanced himself from them.  Witness the AltEn environmental calamity at Mead.  Ricketts was not a buck-stops-here kind of administrator. 

Where our former governor ran government most like a business was in financing and maneuvering candidates in state legislative elections, to put people obligated to him on his oversight body, as would any successful business baron with the wherewithal to choose his own board of directors.  Unfortunately, this way of doing business has seriously weakened Nebraska's constitutional checks and balances.  

Before the conclusions of the Politico article and Ricketts' superficially repaired reputation are etched in stone, their underlying premises need to be more carefully examined, lest the incoming governor thinks he has inherited a formula for success in governing.  What he actually has are many worsening problems that can only be resolved with a stronger hand at the administrative helm of state government.    

Nebraska Authors Diminished

January, 2023

Lincoln —  The reputations of two remarkable Nebraska writers are in decline, according to sources that surprisingly seem to welcome it.   

First, a group of Vermont librarians has removed the name of Dorothy Canfield Fisher from an annual book award on grounds that she may have had connections to the eugenics movement.  The evidence is totally unconvincing.  As to the book in which she is said to show eugenics sympathies — Bonfire —  it is, if anything, a refutation of eugenics: a main character of low birth exceeds all expectations.  No matter.  The award has been renamed.    

Now comes an unexpected swipe at Canfield Fisher's friend and renowned contemporary, Willa Cather, from a PBS News Hour report about a sculptor who is creating Cather's likeness for placement in the U.S. Capitol.  In an otherwise laudatory segment about Cather, viewers (about 2.7 million nightly) are suddenly told: 

"[I]n recent decades, critics have pointed out shortcomings in how she represented race."
"She was a woman of her time.  And she didn't represent Native American life well. She did not represent African American life well or frequently."

This is news to some of us who have read her novels and found them filled with respectful depictions of Native Americans, especially her novels set in the American southwest.  She was in awe of indigenous cultures and saw them as inspirations in Death Comes for the Archbishop and other works.  In Song of the Lark, Mexicans living in Colorado befriend and develop Thea Kronberg's musical talents.  In her final published novel, Sapphira and the Slave Girl, Cather devotes years of work to strip away all sentimentality for the institution of slavery.  Because she was a descendant of slaveowners herself, in her final chapter Cather inserts her real-life self as a five year old Virginian, so no one misses the point that slavery, for her, was not only an abomination but deeply personal.  

To me, Cather was decidedly not a "woman of her time."  In her time, notable novelists were avoiding these subjects entirely, or writing of them stereotypically.   

To be sure, a search for Cather critics turns up a few who find fault in her works on these topics, with reasonable foundation.  But they temper their words carefully so as not to put Cather into a category with bigots or racists, lest today's critics themselves, writing fashionably about race and ethnicity, someday be labeled "of their time."  

Would that PBS News Hour were as judicious with their millions of viewers.  

Bringing Order Out Of Chaos

January, 2023

Washington — After the chaos of the House speaker's election, the nation needs to see a demonstration that the House can pass meaningful legislation under its new leadership and new rules.  It needs quickly to bring an important bill through a standing committee, through the House Rules Committee, and pass it with a roll-call floor vote to send to the Senate.

Anything less invites suspicion that we are still facing insurrection in the Capitol.   

A good choice for the purpose is the restoration of bankruptcy rights for student loan borrowers, which has bipartisan, bicameral support.  It has backing across the ideological spectrum and from the chairman of the Federal Reserve.   Members of the House Freedom Caucus have voiced their favor.  Both houses have legislation for the purpose already drafted from last year. 

This is substantive legislation and a key step in resolving the nation's student loan mess.  Passage could be a factor in breaking the impasse over student loan cancellations, not only by providing another option for borrower relief, but especially by disincentivizing lenders and servicers, whose revenues depend on perpetuation of debt, from preying on the most vulnerable.   

The nation's media are focused on conflict, most notably over how to raise the federal debt ceiling in a few months, doubtless a profound problem.  Stoking conflict, however, is not what the nation needs right now.  We need an answer to the question of whether the Freedom Caucus is bent on bringing down the government, as sometimes seems the case, or actually making it work.  

Bankruptcy restoration legislation presents a rare opportunity not only to help resolve a policy issue, but to resolve procedural issues of the highest possible order.